Bangladesh Signs Third LNG Facility Heads of Agreement
A joint venture comprising Malaysia's Petronas LNG, Hongkong Shanghai Manjala Power and a Bangladeshi company Global LNG is preparing to build a 3.75mn metric tons/year floating storage unit and a fixed jetty-based regasification unit at Kutubdia island in the Bay of Bengal near Cox's Bazar district in southeastern Bangladesh, a senior Petrobangla official told NGW October 17.
State-run Petrobangla inked October 16 a heads of agreement with the joint venture to use the LNG terminal, he said.
The final agreement will be inked on completion of the necessary negotiations, the managing director of Petrobangla’s wholly owned subsidiary Rupantarita Prakritik Gas Company (RPGCL) Md Quamruzzaman said. Bangladesh’s Cabinet Committee on economic affairs approved August 9 the heads of agreement with the JV, he said. It will be the south Asian country’s first agreement to build an LNG import terminal of that kind, Quamruzzaman said.
Petrobangla earlier inked two separate deals with Summit LNG Terminal Co and Excelerate Energy to build two, 3.75mn mt/year floating storage and regasification units at Moheshkhali island in the Bay of Bengal separately, he added.
Petrobangla inked the deal under Speedy Supply of Power and Energy (Special Provision) (Amendment) Act, 2010, by-passing competitive tendering process.
This legislation allows the government sweeping authority to bypass existing legislation in the energy and power sectors, so that it can implement projects quickly, a senior energy and power ministry official said.
The FSRU being developed by US-based Excelerate Energy, is expected to be commissioned next April, while the second FSRU being developed by Summit Group is expected to be commissioned by October 2018.
Separately, Bangladesh has also planned to build three small floating storage and regasification units, each of up to 200mn ft³/d in three separate offshore locations within a year. Petrobangla is also planning to set up two onshore LNG terminals, each with a capacity of 7.5mn mt/year, by 2025.
Bangladesh government has adopted a policy of importing LNG via both long-term contracts and spot deals to achieve competitive prices, the country's minister for power, energy and mineral resources, Nasrul Hamid, said earlier.
The volume to be supplied under spot deals and long-term contracts has yet to be decided.
Bangladesh started facing a natural gas crisis from 2009 as rapid industrialisation forced Petrobangla to ration supplies to energy-intensive industries, power plants, CNG filling stations and households.
M Azizur Rahman