ISLAMABAD: Energas Terminal (Private) Limited, a consortium led by the Lucky Group with QatarEnergy as a member, has sought Prime Minister Shehbaz Sharif’s urgent intervention to secure a refund of its $2 million partial concession fee for a proposed liquefied natural gas (LNG) terminal at Port Qasim, arguing that unresolved government policy issues and a fundamental change in national energy requirements have undermined the project’s viability.
In a letter , addressed to the Prime Minister, Lucky Group Chairman Muhammad Ali Tabba requested that the government direct the Port Qasim Authority (PQA) to return the amount paid by Energas, maintaining that the project’s original rationale had been undermined by changes in national energy policy and prolonged delays in resolving critical fiscal and regulatory issues.
The request comes as PQA has set November 30, 2026, as the deadline for Energas to convey unconditional acceptance of the Final Letter of Intent (LoI) issued on May 20, 2020. In a letter dated August 3, 2026, PQA warned that failure to meet the deadline would result in cancellation of the Final LoI and forfeiture of the $2 million partial concession fee.
Energas maintains that its inability to proceed with the project stems from a combination of changing national energy requirements and unresolved policy, fiscal and infrastructure issues involving the government, PQA and other relevant authorities.
The company says the project was conceived when Pakistan faced substantial gas and LNG requirements and the development of additional LNG import infrastructure was part of the country’s energy strategy. The consortium undertook the project on a self-funded basis and in good faith, without any financial commitment from the government, according to the letter.
However, Energas argues that the circumstances underpinning the investment have since changed significantly, making the proposed terminal commercially questionable.
A key argument advanced by the company is that the government-commissioned Pakistan Integrated Energy Study, in its final report dated March 28, 2025, concluded that no new LNG terminals would be required over the following five years.
Energas says this assessment has fundamentally altered the economic rationale for the project, which has also been held back by unresolved issues that it claims have remained pending despite repeated representations to the authorities.
The company has identified several impediments, including the withdrawal of a five-year tax holiday, uncertainty over customs duties and statutory regulatory orders (SROs), the absence of legislation to implement a Third-Party Access (TPA) exemption for private terminals, unclear pipeline capacity allocations by Sui Northern Gas Pipelines Limited (SNGPL), and the lack of an effective one-window mechanism for investors.
According to the letter, the LNG Policy 2011 provided terminal operators with a five-year tax holiday beginning from the commercial operations date. However, the exemption was withdrawn for new terminals in June 2021, while existing beneficiaries continued to avail themselves of the facility.
Energas argues that the withdrawal of the tax holiday, which it says was a key assumption underlying the project at the time of the provisional LOI, has adversely affected its financial projections and placed the proposed terminal at a competitive disadvantage.
The company attributes the change to Federal Board of Revenue decisions taken in view of International Monetary Fund structural conditions and the country’s economic and financial constraints. It says the resulting increase in the project’s capital expenditure requirements has further weakened its commercial viability.
Another unresolved issue concerns the implementation of an exemption from Third-Party Access requirements for privately owned LNG terminals. Energas says the exemption had received Cabinet approval but was not implemented through the required legislation.
The company has also raised concerns over the availability of pipeline infrastructure and capacity to transport additional regasified LNG (RLNG) from southern terminals to northern markets.
It maintains that uncertainty over SNGPL’s capacity allocation creates significant operational risks, as the terminal’s ability to deliver gas to consumers would remain unclear even if construction were completed.
Disputes over the interpretation of SROs, customs duty treatment and collection, as well as lease payments, have also been cited as outstanding matters affecting the project.
Energas further argues that the one-window facility envisaged under the LNG Policy 2011 has not materialised, forcing the company to approach multiple government departments and authorities to secure the approvals and decisions required to advance the project.
The letter states that the consortium has repeatedly brought these issues to the attention of the relevant authorities. PQA extended the deadline for acceptance of the Final LOI to November 30, 2026, through a letter dated September 25, 2025. However, according to Energas, the substantive matters affecting the project remained unresolved.
The company subsequently wrote to the Ministry of Petroleum on August 4, 2025, and reiterated its concerns in correspondence with the authorities on October 9, 2025, seeking government support to resolve the outstanding issues and enable it to take the next steps towards project implementation.
Energas says it had also raised the matter with the Prime Minister in a letter dated October 26, 2022, highlighting the need to resolve pipeline capacity allocation, implement the TPA exemption and reinstate the five-year tax holiday.
The company stated that resolving these issues was critical to the Final Investment Decision of QatarEnergy and local investors. It also maintained that the government had committed to addressing the matters following discussions with the State of Qatar.
Despite the passage of time, the issues remain unresolved, according to the letter.
Energas has argued that responsibility for the delay in commissioning and the project’s present non-viability rests with the government and PQA because of their failure to resolve the outstanding matters.
It has asked the Prime Minister to intervene to ensure a fair and orderly settlement and direct PQA to refund the $2 million partial concession fee rather than cancel the Final LOI and forfeit the amount.
The company’s request places the government in a difficult position: it must consider the investor’s demand for a refund against PQA’s stated deadline and the broader question of whether additional LNG import infrastructure is justified in light of the government-commissioned study’s assessment of future requirements.
