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Liquefied Natural Gas Company is responsible for processing LNG, a natural gas cooled down to liquid form for ease and safety of non-pressurized storage or transport. It takes up about 1/600th the volume of natural gas in the gaseous state.
In Pakistan, if a registered company (inside or outside Pakistan) wishes to carry out the business of LNG, they must apply for a license in a prescribed format to the Oil & Gas Regulatory Authority (OGRA).
Initially, a company has to apply for a Provisional License under Rule 33 of LNG Rules, 2007, along with a fee of Rs. 5 million. The Provisional License is granted for a period of one year (1), and within this period, the licensee shall have to submit an application for the grant of a construction license, fulfilling all formalities under Rule 4 (3) of LNG Rules 2007. If required, the Authority may appoint a consultant under Rule 31(i) of LNG Rules, 2007 for evaluation.
The Construction license is granted for two years. Upon submission of an application that construction activity has commenced, the Authority appoints a consultant under Rule 33 (1)(ii) of LNG Rules, 2007 during construction to determine whether the project has been successfully commissioned in accordance with the project implementation plan. After a satisfactory report from the consultant, the License for the operation of the LNG Terminal is issued to the applicant.
The application filed must be accompanied by various documents, such as the certificate of incorporation, attested copies of the memorandum and articles of association of the company, attested copy of the company’s certificate of commencement of business, attested copy of the applicant’s latest yearly submission to the corporate regulator, attested copy of the latest audited annual financial statements of the applicant, attested copy of the corporate authorizations allowing the submission of the application, and so on. The list of the documents that are required to be attached along with the application is provided in Rule No. 4(3) of LNG Rules 2007.
Once the documentation, as well as the quorum of the Authority, is complete, the case is finalized within one hundred and eighty days (180). Please note that the acceptance of an application depends on the area of operation, period of authorization, and such other terms as the Authority may determine. The license will be granted if the application is in accordance with the rules and the LNG Policy.
The license granted by the Authority will be valid for a maximum period of twenty (20) years. While granting the license, the Authority will keep in view, inter alia, the investment to be made by the applicant.
The following annual fees shall be payable at the time of the grant or renewal of the license, as the case may be, and thereafter, yearly in advance, namely: