Wednesday, October 18, 2017 | ePaper
Country to import LNG from global market
Bangladesh will import liquefied natural gas (LNG) from international market under 'term deals' and 'spot contracts' like the refined petroleum oil to achieve competitive prices.
State Minister for Power, Energy and Mineral Resources Nasrul Hamid said this while talking to journalists at a function recently in the city.
He said like the refined petroleum oil, there will be both tender and term deals to source LNG from global suppliers.
To ink term deals, state-run Petrobangla has already inked two separate memorandums of understanding (MoUs) with Qatar's RasGas and Switzerland-based AOT Energy, he said.
Bangladesh is eyeing to start import of LNG from international market from early 2018 as the country's first LNG import terminal, a 3.75 million tonne per year capacity floating storage and re-gasification unit (FSRU) being developed by US-based Excelerate Energy, is expected to be commissioned in April 2018.
The country's second FSRU, also with a similar capacity of 3.75 million tonne per year, is being developed by Summit Group with its commissioning expected by the end of 2018.
Petrobangla is also planning to set up two onshore LNG terminals, each with a capacity of 7.5 million tonne per year within next several years. And it would have to bear the cost of about $1.8 billion per year from 2018 and onwards.
It has planned to import expensive LNG to the tune of around 500 million cubic feet per day (mccfd) to meet the mounting natural gas demand in local markets.
It has estimated that it would be able to realise about $400 million per year through sales of re-gasified LNG to domestic consumers.
Earlier, Bangladesh re-initiated tender system to source refined petroleum products in February 2016, after 15 years to get competitive pricing from the suppliers, said a senior official of Bangladesh Petroleum Corporation.
Since then, the BPC has continued sourcing 0.05 per cent sulfur gasoil (diesel), A-1 jet fuel and 180 CST high sulfur fuel oil through both term deals and tendering.
Bangladesh has already decided to source 50 per cent of its total refined petroleum product from international market through open tendering and the remaining half through government-to-government negotiation with state-owned international oil suppliers in 2017, said the BPC official.
Bangladesh has moved to import LNG as it is now reeling under acute natural gas shortage with daily average output of around 2,700 mmcfd against demand of 3,300 mmcfd, according to Petrobangla.
The country started facing natural gas shortage from 2009 with rapid industrialisation forcing Petrobangla to ration natural gas supplies to gas-guzzling industries, power plants, CNG (compressed natural gas) filling stations and households.