• Petrobangla moves to sign deal soon

    The government has moved afresh to initiate a deal with Qatar’s Ras Gas to import expensive LNG six years after inking a MoU, said sources. A high-level government team is expected to visit Qatar within this month to discuss elaborately on issues regarding the quantity of liquefied natural gas (LNG) to be imported from Qatar and its pricing, LNG Cell Chief of Petrobangla Md Quamruzzaman told the FE Saturday. State-run Petrobangla earlier had inked a memorandum of understanding (MoU) with Qatar in January 2011 to import around 4.0 million tonnes of LNG annually. It later extended the deadline of the MoU twice due to delaying of works to build LNG import terminal.

    Petrobangla inked a ‘confidentiality’ deal with Qatar’s Ras Gas in Doha in October 2015 to facilitate import of LNG. Inking the initial agreement would be a follow-up deal after signing of the ‘confidentiality deal, said Petrobangla official. Officials said, Petrobangla has now been ‘liberal’ to award deals to private sector for building LNG terminals under Quick Enhancement of Electricity and Energy Supply (Special Provision) Act, 2010 bypassing competitive tendering process.

    Petrobangla, also known as Bangladesh Oil, Gas and Mineral Corporation, inked the first final deal with US-based Excelerate Energy Bangladesh Ltd for construction of the South Asian country’s first LNG terminal – a FSRU (floating, storage and re-gasification unit) – at Moheshkhali island in the Bay of Bengal on July 18, 2016. Excelerate is now working to implement the project having the LNG import handling capacity of up to 700 million cubic feet per day (mmcfd), said Mr Quamruzzaman.

    It later inked a MoU on December 29, 2016 with India’s Petronet to build another LNG import terminal at Kutubdia island having a capacity to handle around 1,000 mmcfd of imported LNG. Petrobangla again initiated a deal with Summit LNG Terminal Company Pvt Ltd on January 4, 2017 to build another FSRU at Moheshkhali island having the capacity to handle around 500 mmcfd of gas.

    It has now moved to sign another deal with Indian Reliance to build another LNG terminal at Moheshkhali island, said a senior Petrobangla official. State-run Power Cell has also planned separately to build a LNG terminal in the same area at Moheshkhali, said officials. Under the deals, Petrobangla would have to pay charges and fees to the LNG terminal builders even if it does not import LNG through the terminals, said Petrobangla sources.

    Excelerate would charge around US$0.59 per unit (1,000 cubic feet) of natural gas as service charge and costs for tag boat operation, port facility etc. Costs for Petronet, Summit and Reliance are almost similar to that of Excelerate. Petrobangla has estimated that the government would have to spend around $1.57 billion annually to import LNG only through the terminal to be built by Excelerate at an estimated cost for LNG at US$8 perMcf.

    Bangladesh is now reeling under acute natural gas crisis with daily average output of around 2,700 mmcfd of gas against the demand for over 3,300 mmcfd, according to Petrobangla. The country started facing natural gas crisis 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. Micah Hyde Authentic Jersey

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