Pakistan and ITFC sign $386m agreement for import of LNG and oil

The agreement was inked between the Economic Affairs Division, the ITFC, and the representatives of PSO, PARCO, and PLL.

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Pakistan has inked a financing agreement amounting to $386 million with the International Islamic Trade Finance Corporation (ITFC), a subsidiary of the Islamic Development Bank (IsDB) Group, to import LNG and oil.

According to a press statement released on Monday, this facility will be employed by Pakistan State Oil Company Limited (PSO), Pak Arab Refinery Limited (PARCO), and Pakistan LNG Limited (PLL).

The agreement was inked between the Economic Affairs Division, the ITFC, and the representatives of PSO, PARCO, and PLL.

(Economic Affairs Division)

The financing agreement supplies trade financing amounting to $386 million for one year to import oil and LNG. The ITFC has consented to provide trade financing of $1.2 billion during 2020 to import LNG and petroleum by PSO, PARCO, and PLL.

(Economic Affairs Division)

It must be known that this facility is a part of a framework agreement signed with ITFC in April 2018 for a total investment of $4.5 billion over three years (2018-2020).

(Pakistan State Oil)

The signing of this financing facility will help finance oil and gas import bills of the country and ease pressure on the country’s foreign exchange reserves.

During the signing ceremony, both sides expressed hope to work closely with each other to mobilize the country’s socio-economic development.

Zulfiqarabad Oil Terminal, Sindh.

What are your views on this? Share with us in the comments below.

  • Import of LNG could be a temporarily charming solution to energy need of our country but this is not a proper or prolong solution. At this point we do not fully understand the future impact of this contract. There are questions which need to be discuss publicly like, How much interest we will have to pay? What will be the consumer cost? So, in the above mentioned scenerio, it will be imperetive to tap indigenous sources of renewable energy rather than depending on the import of costly fuel.


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