Liquefied Natural Gas Company responsible to process the 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 Oil & Gas Regulatory Authority (OGRA).
Initially a company has to apply for Provisional License under Rule 33 of LNG Rules, 2007 along with a fee of Rs. 5 million. Provisional License is granted for a period of one year (1) and within this period the licensee shall have to submit application for grant of construction license fulfilling all formalities under Rule 4 (3) of LNG Rules 2007. If required, Authority may appoint a consultant under Rule 31(i) of LNG Rules, 2007 for evaluation.
The Construction license is granted for two years. On submission of application that construction activity has commenced, the Authority appoints a consultant under Rule 33 (1)(ii) of LNG Rules, 2007 during construction to determine that whether the project has been successfully commissioned in accordance with project implementation plan. After satisfactory report from the consultant, the License for operation of LNG Terminal is issued to the applicant.
The application filed must be accompanied by various document such as 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 etc. The list of the documents that required to be attached along with the application are provided in Rule No. 4(3) in LNG Rules 2007.
Once the documentation as well as 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 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.
FEES (SCHEDULE II)
- Provisional Fees: Rs. 5 Million;
- Application for a new license = one-half of one hundredth of one percent of the estimated cost of the project;
- 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:
- one-half of one percent of the gross revenue of the licensee generated from the provision of the licensed regulated activity;
- one-tenth of one percent of the gross sale revenue of the licensee generated from the supply of LNG and / or RLNG;
- if a licensee is engaged in the supply of LNG or RLNG and is also undertaking one or more regulated activity(ies), the fees specified in i. and ii. above.
- Oil and Gas Regulatory Authority Ordinance, 2002
- Oil and Gas Regulatory Authority, LNG Rules 2007 / S.R.O. 458(I)/2007
- Liquefied Natural Gas (LNG) Policy, 2011