Pakistan and Qatar are close to a revised LNG deal that would cut the price of imported gas. The revised LNG deal sets a final offer of 11.96 per cent of Brent crude for both long-term supply contracts, sources in Pakistan State Oil told The Express Tribune.
Pakistan had asked QatarEnergy to lower the price from 13.37 per cent of Brent to 10.20 per cent under the first contract. QatarEnergy declined that request, but at one stage indicated a reduced price of 11.36 per cent for the first contract. For the second contract, Pakistan asked to keep the price unchanged at 10.20 per cent for all future supplies. QatarEnergy instead demanded an increase to 11.98 per cent. Its final offer settles both contracts at 11.96 per cent.
The sources said the Qatar prices are final, and Pakistan must now decide. Pakistan State Oil is seeking government approval to seal the deal by November 3.
What the revised LNG deal covers
The offer covers 66 cargoes a year, against the existing deal for 108 LNG cargoes a year from 2027 to 2031. As many as 210 LNG cargoes have been deferred over four years after 2031.
Pakistan has two LNG supply contracts with Qatar, and both expire in 2031. Pakistan State Oil and QatarEnergy hold a sale purchase agreement for 15 years, valid from 2016 to 2031, and another contract for 10 years, valid from 2021 to 2031. Both were signed under government-to-government arrangements.
Under those agreements, Pakistan State Oil must receive 6.75 million tonnes, or 108 cargoes, each contract year on a take-or-pay basis, with minimal flexibility for diversion. If surplus cargoes are sold abroad, the profit goes to QatarEnergy, while any loss falls on Pakistan State Oil.
That rigidity created the problem the review tries to fix. Power-sector demand for gas has fallen, so LNG supply in the Sui system became surplus. In 2023, the government authorised Pakistan State Oil to negotiate a cut of two cargoes a month with QatarEnergy. As a result, 24 cargoes were reduced under the net proceeds differential arrangement in the 2026 annual delivery plan.
How the price review works
Each side served a price review notice in March 2026. QatarEnergy served its notice for the second agreement on March 7, 2026. Pakistan State Oil served its notice for the first agreement on March 19, 2026.
Under the first agreement, either party may seek renegotiation after the 10th anniversary of the start date, which fell on March 1, 2026, and the parties must then meet in good faith to discuss an adjustment.
If they agree, the revised price applies from the review date until the end of the supply period, and neither party can issue a further notice. If they fail to agree within six months, either party may terminate the agreement, with termination taking effect at the end of the contract year in which notice was served.
Pakistan therefore has three options: negotiate a revised price, accept the existing price if talks fail, or terminate the agreement. Termination carries supply continuity risk, so it remains the least attractive path.
The second agreement requires the price to sit within the range of comparable contracts, benchmarked against reputable industry publications.
Why the deal matters for winter gas
The price of imported gas feeds straight into power bills and winter supply. Pakistan plans to import 22 LNG cargoes between November 2026 and February 2027, including 10 from the spot market at roughly twice the contracted price, according to earlier reporting, so every cut in the contract price eases pressure on the winter bill.
The deal also sits beside QatarEnergy’s wider retreat from new terminal plans in Pakistan. The company and its partners recently dropped a plan for a Port Qasim LNG terminal, as reported here: Energas Drops Port Qasim LNG Terminal Plan. Pakistan also faced a winter gas crunch warning when import decisions slipped, covered here: Pakistan Winter Gas Shortage Lng Import Delay. The government has since assured fuel supplies until November, as reported here: Aurangzeb Assures Fuel Supplies Until November. Domestic output also matters for the balance, with OGDC starting gas and condensate production from Bitrism East-1 in Khairpur, as reported here: OGDC starts gas and condensate production from Bitrism East-1 well in Khairpur.
