The need for LNG import

Bangladesh is in the midst of a serious crisis, in terms of availability of cheap source/s of energy. Its existing industries are limping and investments in new ones are on the hold for highly inadequate supply of natural gas. The gas-based power plants have been operating well below their respective capacities and fertilizer factories often face forced closure to divert gas to power plants. Household cooking stoves remain dry in many areas of the capital city from morning until late in the afternoon. Motor vehicles are required to wait in long queues before the compressed natural gas (CNG) filling stations.

Even a couple of decades back, the authorities could not foresee the present crisis out of the misconception that the country was floating on gas. Highly optimistic assessments and projections by external sources had largely influenced the domestic policymakers. But when the ground realities dawned on them, they started burning midnight oil to find out cheap alternatives to natural gas. They found one-coal and in sufficient quantities, enough to meet the demand for long 30 years. But unfortunately, because of the dispute over the method of its extraction, the large part of the huge coal reserve is likely to remain unexploited and unused.   

In the meanwhile, the authorities decided in 2011 to import a relatively cheaper source of energy---liquefied natural gas (LNG) --- to feed the gas-based   power plants and industries, particularly those located in the gas-starved Chittagong region. The government also signed a memorandum of understanding (MoU) with the Gulf state of Qatar in that year to import 4.0 million metric tonnes of LNG despite the fact that the country did not have necessary LNG terminal in place at that time. Nor it could develop one in the past three years. On the eve of its expiry, the government in March last year extended the life of the MoU with Qatar until June 2015. It remains to be seen whether the government will be able to complete the construction work of the LNG terminal along the country's coastline. The ministry of power, energy and mineral resources had negotiations with a couple of US companies but nothing could be finalised as yet. But the project is likely to receive priority attention this time following the ruling Awami League's electoral pledge to start import of LNG within next five years and its inclusion in the small list of first-track projects by the new government.

There is no denying that energy crisis has been taking an unsustainable economic toll on the country and a government worth its name cannot remain indifferent to the issue. However, policymakers, while trying to mitigate the crisis, do need to identify an energy source which is less expensive and least pollutant. The LNG, it seems, is the right choice. Hopefully, there will not be any inordinate delay in the construction of the LNG terminal and consequent arrival of LNG. It has been observed time and again that despite priority attached at the highest level of the government, because of the procedural delays at the official level many important projects remain stuck-up. It is expected that the LNG terminal would not encounter such a problem.