ADB set to bankroll gas dev work of 3 state cos

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FHM Humayan Kabir
Three state-owned energy companies are set to get a big boost in the new year as the Asian Development Bank (ADB) has confirmed bank-rolling their gas production and supply network expansion programmes, officials said.
Finance ministry officials disclosed that a delegation from the Manila-based lender last month has confirmed US$311 million in loan for three cash-starved state-owned energy companies to improve the country's gas production and supply system.
"A company will install two compressors and a gas pipeline for augmenting gas supply, another will produce 120 million cubic feet (mmcf) more gas and control seepage in Titas field, and the third one will lay distribution lines with the fund," a senior energy ministry official told the FE.
He said the three energy companies have taken up a US$542 million programme to execute development schemes to provide booster to the country's ailing gas supply system aimed at cushioning the current energy supply crunch.
"It's great news for the country that the ADB has agreed to provide such a huge fund. The fund-starved public companies will get a big fillip in their development works in the coming days," the official said.
He said: "Since energy sector development work involves huge investment, finance from ADB will help strengthen the capacity of the state-owned companies."
The four projects undertaken by the gas companies would require US$542 million. The ADB would offer $311 million, while the rest would be provided by the government from its own resources, it was learnt.
An energy sector review mission from the ADB headquarters in Manila in December last has agreed to provide the $311 million loan package for the three state-owned gas companies, an economic relations division (ERD) official told the FE.
"Now we will sign the loan deals with the donor after completing final negotiations within a short period," he said.
State-owned Bangladesh Gas Field Company Ltd (BGFCL) has taken up a "first track" scheme to increase production by 120mmcfd gas from two wells in Titas field in the next two years in order to face the prevailing energy supply crisis with the support of the ADB fund.
Bangladesh, now experiencing an eight per cent annual demand growth, comes up with nearly 1950mmcfd of gas supply per day against the demand for over 2200mmcfd.
Upon getting assistance from ADB, the largest state-owned gas producer BGFCL would also work to repair five gas wells in its Titas field where a gas seepage started in 2006, it was learnt.
Gas Transmission Company Ltd (GTCL), a state-owned gas transmission firm, will set up two compressors at Ashuganj in Brahmanbaria and Elenga in Tangail to pump more gas to consumers.
The company will also lay a 61-kilometre 30-inch-diameter gas pipeline from Ashuganj to Bakhrabad to supply additional gas to the industrial zone in Chittagong, now dogged by a supply shortage of 200mmcfd gas against demand.
Another state-owned gas distribution firm -Sundarban--will lay a 845 kilometre and 2-inch to 20-inch-diameter distribution pipeline in the country's five south-western districts with ADB assistance to supply gas to consumers.
The GTCL is now working on laying up a transmission line to supply gas to the Khulna, Bagerhat, Jessore, Kushtia and Jhenidah districts in the south-western region.
The energy division officials said the $542 million energy sector development programme would help Bangladesh minimise its ongoing acute energy crunch in a couple of years.