July 4, 2018 / 10:03 AM / a year ago

Pakistan LNG cancels tender after high offers - sources

A logo of liquefied natural gas (LNG) is pictured on a LNG truck outside a heavy-duty truck shop in Yutian county, China's Hebei province September 29, 2017. REUTERS/Jason Lee/Files

SINGAPORE (Reuters) - Pakistan LNG, a subsidiary of state-owned Government Holdings, has cancelled a tender seeking six cargoes of liquefied natural gas (LNG) for delivery in July and August, two industry sources said on Wednesday.

Pakistan is among major LNG buyers in Asia and the move could weigh on spot Asian LNG prices which have been declining after rising to a 3-1/2-year high in mid-June.

Pakistan LNG has decided to cancel the tender due to higher than expected prices offered by sellers, one of the sources said.

“(Power) demand is fluctuating,” the source said, adding that there is no urgent need for power plants to seek replacement cargoes. The company is unlikely to re-issue the tender, the source added.

Both industry sources declined to be identified as they were not authorised to speak with media.

The company still has a separate tender seeking five cargoes of the super-chilled fuel for September to October delivery.

Prompt cargoes meant for Pakistan are being offered in the spot market, the second source said, though details were scant.

With Indian demand for LNG waning due to its monsoon season and high inventory, and with not all terminals operating in full capacity, the cargoes are unlikely to be diverted to India, the second source said.

Reporting by Jessica Jaganathan; Editing by Joseph Radford and Manolo Serapio Jr.

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