KARACHI: An investor consortium comprising QatarEnergy and Pakistan’s Lucky Group has abandoned a planned $150 million liquefied natural gas (LNG) import terminal project in Pakistan after years of delays, according to officials and documents seen by Arab News, dealing a setback to the country’s efforts to expand energy infrastructure and attract foreign investment.

The development deals a setback to the government’s efforts to attract foreign direct investment as the collapse of the long-delayed Qatar-backed project could cost Pakistan a planned multimillion dollar investment.

The consortium, named Energas Terminal Pvt. Ltd. (ETPL), has written to Prime Minister Shehbaz Sharif seeking a refund of $2 million partial concession fee it had paid to the Port Qasim Authority (PQA) in Nov. 2019.

“We asked the PM to release the money that we had given as the project is not expected to move forward,” EPTL chairman chairman Muhammad Ali Tabba told Arab News on Tuesday, citing lack of government approvals for its Letter of Intent (LOI) as a major reason.

“It was a total investment of $150 million for the construction of the terminal,” Tabba said.

ETPL’s request for the refund comes in response to a letter written by the PQA to the consortium in August, demanding that it unconditionally accept its Final LOI by Nov. 30.

“Failing which PQA will cancel the Final LOI and forfeit the $2 million partial concession fee paid by Energas,” reads the ETPL’s letter reviewed by Arab News.

Tabba said the project had already come to an end around three, four years ago.

“We were building the terminal, but they (QatarEnergy) were underwriting $50,000-$60,000 per day for the FSRU (floating storage and regasification unit),” he said.

In its letter to Sharif, the consortium cited two “critical factors” behind the project’s failure: changes in Pakistan’s energy policy and unresolved policy and fiscal issues, including the withdrawal of tax exemptions under a $7 billion International Monetary Fund (IMF) loan program that ETPL said had rendered the project unviable.

Pakistan withdrew the five-year tax holiday for new LNG terminals in June 2021.

“FBR (state-run Federal Board of Revenue) had withdrawn the exemption in view of the IMF structural conditionality,” ETPL told the PM, terming the tax holiday “critical” for its business.

In March 2025, Energas said the government-commissioned Pakistan Integrated Energy Study found no need for new LNG terminals over the following five years, undermining the project’s economic rationale and changing the circumstances under which it was originally conceived.

The “resolution of these matters was critical to the Final Investment Decision of Qatar Energy and the local investors,” ETPL said in its letter.

“The responsibility for the delay in the project’s commissioning, and indeed its current non-viability, rests with the government/PQA due to unresolved matters and inaction on its part,” the consortium said.

While PQA’s spokesperson Asad Warsi was not available to comment on the issue, a top official at the port authority said the PQA had not shut down the project.

“We have extended it till 30th November,” the official told Arab News, seeking anonymity for he was not allowed to speak publicly.

The PQA, he said, wanted the consortium to show progress they had made on the project over the years.

“If they don’t tell us the progress then obviously they will need to send us a request seeking further extension,” the official said.

About policy changes, he acknowledged that the five-year tax holiday was withdrawn after remaining effective till 2019 for the existing two LNG terminals set up in 2015 and 2017.

“Perhaps in 2021, they terminated the tax holiday under the pressure of IMF,” he recalled, estimating the total project cost approximately at $250 million.