Engro invests in sustainability
Engro Corporation has invested Rs.130 billion over the last five years. Engro has long been stressing on the import of LNG to meet the energy needs of Pakistan. A breakthrough in chemical and LPG storage, Engro Vopak Terminal Limited, is a joint venture of Royal Vopak of the Netherlands and Engro Corporation. It has been providing world class services to the growing chemical and petrochemical industry of Pakistan. The company offers storage and handling solutions for liquid and gaseous chemicals, oil products, petrochemicals, bio-fuels, vegetable oils and liquefied natural gas (LNG).
Engro Vopak owns and operates the only shipping terminal and storage facility in Pakistan for liquid chemicals and liquefied petroleum gas (LPG). In 2009, the company commissioned the first cryogenic import facility in Pakistan for ethylene. However, Engro recently invited expressions of interest from private sector firms to build an LNG floating storage and re-gasification vessel.
Liquefied natural gas is just what the name suggests: natural gas that is liquefied through a combination of high pressure and cooling. It is possible to accommodate 600 times more LNG in a given cubic space as regular natural gas, making it possible to feasibly transport large volumes of gas on ships from countries with hydrocarbon surpluses such as Qatar, Iran and Russia to countries with severe shortages, such as Pakistan and India.
Once at an import terminal, the LNG is then converted back to gas form (essentially by allowing it to come back to room temperature and normal pressure) and then pumped into a gas pipeline system.
Both government and private sector organisations believe that LNG is the only way Pakistan can keep its energy costs low, rather than having to rely on expensive oil imports for power generation. Pakistan is also aided by geography: the main ports in the country are less than three days sailing time from two of the three largest gas producing countries in the world, i.e. Iran and Qatar.
Engro Vopak’s expertise in chemical transportation and storage is expected to be an advantage in its efforts to set up LNG import facilities.
Engro Fertiliser Urea Plant
Engro’s new fertiliser plant was established in the beginning of 2011 at Daharaki, Sindh. The plant, with a capacity to produce 1.3 million tons of urea, aims at creating local self- sufficiency in urea production.
Currently Engro Fertilisers Limited, a wholly-owned subsidiary of Engro Corporation, holds about 25 percent of the di-ammonium phosphate (DAP) market and 16 percent of the urea market. The new plant will help propel Engro’s share to about 31 percent of the urea market. According to Engro officials, consequently there will be no need to import urea, unless there is a continuation of gas curtailment.
Natural gas is used not only for power generation in fertiliser plants but also as a key ingredient in the manufacturing of urea. To regulate the supply of natural gas Engro Fertiliser has signed a contract with the government, as a result of which Sui Northern Gas Pipelines Limited (SNGPL) will supply 100 million cubic feet per day (mmcfd) of gas to the plant from the Qadirpur gas field. In the event of a shortfall, SNGPL will provide gas from elsewhere within its network.
Engro has also set up an expansion plant in response to open government bidding between local and international competitors. Engro invested $1.1 billion in establishing the plant. It is one of the biggest industrial investments by a Pakistani company, which was raised through investments from International Finance Corporation (IFC), local banks and international institutions.
Engro is not in favour of importing urea and stresses on a regular gas supply to the top fertiliser plants. By avoiding urea imports, the country would save up to $350 million annually. Engro regards smooth gas supply as crucial for its active projects and for attracting foreign investment