Oil Report

Pakistan delays LNG contract with French company

ISLAMABAD, April 14 (Reuters) - Pakistan's oil ministry said on Wednesday it would delay signing a contract with French company GDF Suez GSZ.PA for the import of liquefied natural gas because the Supreme Court had decided to look into the deal.

The Supreme Court step followed media reports that Pakistan had lost $1 billion when senior Petroleum Ministry officials ignored the lowest bid by Fauji Foundation, an investment group run by former Pakistan military officers, and European company Vitol, for a 3.5 million-tonnes-a-year contract.

Any long-term delay in signing or a cancellation of the deal could hurt Pakistan’s efforts to ease an energy crisis, and hurt its image at a time when its sluggish economy badly needs foreign investment.

“No contract will be signed until the matter is disposed of by the court,” S.M. Zafar, a lawyer for the Petroleum Ministry, told reporters. (Reporting by Kamran Haider; Writing by Michael Georgy; (Editing by Clarence Fernandez)