Tuesday, June 18, 2024

Italian Company Earns $500 Million by Reselling Cancelled LNG Contract to Pakistan

According to research by two charity organizations, Eni SpA profited roughly $550 million over the previous two years by cancelling and then reselling promised liquefied natural gas to Pakistan, aggravating the Asian country’s energy woes. 

According to Source Materials, a research non-profit, and Recommon, an Italian environmental organization, the Italian energy giant failed to deliver a number of anticipated cargoes under a contract to furnish one LNG cargo per month between late 2021 and early 2023. According to the joint study, Eni’s LNG ships ceased sailing to Pakistan and started sailing to Turkey. 

According to a Bloomberg story from the previous year, beginning in late 2021, Pakistan’s two main suppliers, notably Eni, started cancelling more deliveries. In the year leading up to February 2023, Eni missed at least four out of 12 deliveries, per government statistics analyzed by Bloomberg. 

Eni said that it has “in all cases evaluated and agreed alternative commercial solutions among the affected parties, including supply of replacement cargoes, rescheduling and deferrals” 

The Pakistan government said that “non-supply of LNG cargoes by Eni are a contractual matter covered under the confidentiality provisions.” 

Recommon is an Italian activist group that has criticized Eni over revenues from its fossil fuel sector. The source material looks into climate change. The organizations asserted that Pakistan’s increased reliance on coal as a result of the drop in LNG supplies has increased emissions. 

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