The Special Investment Facilitation Council (SIFC) has instructed the Petroleum Division to initiate steps for restarting a Liquefied Petroleum Gas (LPG) plant in partnership with Jamshoro Joint Venture Limited (JJVL). This development comes after a period of inactivity due to disagreements between the parties involved.
JJVL had been authorized since 2005 to extract LPG and natural gas from Sui Southern Gas Company Limited's (SSGC) transmission pipeline under a previous agreement. The collaboration aimed to enhance domestic LPG production and reduce reliance on imports, thereby promoting economic stability.
The original contract was suspended in 2018 due to disputes over processing charges between the two companies. With SIFC's intervention, both entities have now agreed on an equitable revenue-sharing formula.
SSGC has previously benefited from various operational models with JJVL, earning over $110 million in profits. Currently, SSGC imports approximately 170,137 metric tons of LPG annually, costing around $107 million.
The revived partnership with JJVL is expected to yield an estimated annual LPG production of 91,250 metric tons, potentially increasing revenue by up to $7 million. This local production could reduce SSGC's current imports by about 53%, resulting in annual savings of approximately $57 million in foreign exchange.
By restarting the LPG plant with SIFC's support, Pakistan aims to decrease import dependency and achieve significant annual savings, contributing to the country's economic stability.
