Pakistan Navigates 2026 RLNG Surplus; 24 Qatar Cargoes Diverted to Egypt. -

Pakistan’s Petroleum Division is currently managing a critical energy dilemma as declining domestic demand has led to a projected surplus of 35 LNG cargoes in 2026. To mitigate financial risks and stabilize the gas network, the government has negotiated the diversion of 24 contracted cargoes from QatarEnergy to international markets, including Egypt.

Key Challenges in the 2026 RLNG Allocation

Contractual Risks & Diversions: Under a Net Proceeds Differential (NPD) agreement finalized in late 2025, Qatar will divert 24 cargoes in 2026. While this prevents a physical glut, Pakistan must absorb any financial losses if these cargoes sell below the original contract price.
System Instability: Lower-than-expected demand from the power and industrial sectors caused pipeline pressure to surge past the safety threshold of 5 billion cubic feet (bcf). To protect infrastructure, authorities were forced to curtail 200 to 400 MMCFD of cheaper indigenous gas.
Financial Losses: The underutilization of RLNG-based power plants has created a significant financial burden. The power sector’s failure to meet committed purchase quantities led to a Rs 1.1 trillion loss over the last four years, with an additional Rs 242 billion loss expected in the current fiscal year.
Impact on SNGPL: The surplus has left Sui Northern Gas Pipelines Limited (SNGPL) with excess inventory. To absorb this glut, the government is considering lifting the long-standing ban on new gas connections to add over 120,000 consumers in FY2026.
Surplus Projections: Despite diverting 35 shipments (24 from Qatar and 11 from Eni), Pakistan is still expected to have 13 surplus cargoes in 2026. Long-term projections estimate a cumulative surplus of 177 cargoes through 2031.