Bangladesh's planned maiden land-based LNG terminal remains trapped in land-acquisition dilemmas for long while temporary floating ones banking on swelling imports of the liquefied natural gas amid fuel shortages, said sources.
The plan for building the state-sector plant was made around a decade back, but the government was yet to arrange necessary land for the project.
On the contrary, they said, the Energy and Mineral Resources Division (EMRD) under the Ministry of Power, Energy and Mineral Resources (MPEMR) has awarded four offshore LNG terminals named floating storage and regasification units (FSRUs) in the private sector over the past decade.
Of the FSRUs, two are in operation and another two new are expected to be commissioned in the next three years, a senior Petrobangla official told the FE Thursday.
He said the government initially planned to build the land terminal with a capacity of 1,000 million cubic feet per day (mmcfd) under the nomenclature of 'Bangabandhu Sheikh Mujib Land Based LNG Terminal' on Matarbari island back in 2014 when the plan to build first FSRU was also initiated.
The deal on building the first FSRU on Moheshkhali island in the bay was inked in July 2016, but necessary land to build the land-based LNG terminal was not yet arranged, the official laments.
The commercial supply of regasified LNG to consumers from the first FSRU also started on August 19, 2018.
Sources have said state-owned Rupantorito Prakritik Gas Company Ltd (RPGCL), a wholly owned subsidiary of Petrobangla, floated tender inviting expression of interest (EoI) from interested developers in 2019.
Also, the RPGCL authority short-listed eight global firms for building the first land-based LNG terminal. It also issued request for proposals (RfPs) for potential firms in March 2021 to submit their proposals within six months, says the official.
"But, as the required land was not yet arranged, RPGCL has already extended the timeline for submitting proposals several times-latest up to March 28, 2024," he adds.
After years of efforts to arrange land the MPEMR recently has decided to buy the 'ash land' owned by state-owned Coal Power Generation Company Bangladesh Ltd (CPGCBL) at around Tk 30 billion for setting up the land terminal.
Then again, the land has yet to be handed over to the EMRD as payment to the CPGCBL has yet to be made, said sources.
They have said the proposed land-based LNG terminal is planned to be built by the selected contractor on build, own, operate and transfer (BOOT) basis at Matarbari in Cox's Bazar district.
The project company would own, operate and maintain the plant for 20 years.
Japanese consulting firm Tokyo Gas Co Ltd has carried out feasibility study and prepared the RfP documents to help select the contractor.
The Japanese firm will also help the government in evaluating the bid to select an efficient contactor to build the onshore LNG terminal.
The eight firms that got the RfPs to build the terminal include Mitsui & Co Ltd, Japan Investment Corporation for Matarbari Regas Terminal, a joint venture of Inpex Corporation, Sojitj Corporation, Kyushu Electric Power Co and local Unique Hotel and Resorts Ltd, joint venture of Total Gas Electric Holdings and Total Gas and Power Business Service of France, Petronet LNG Ltd, joint venture of Qatar Petroleum LNG Services and Exxon Mobil of Qatar, joint venture of local Summit Corporation Ltd, Mitsubishi Corporation, and Jera Co Inc, and joint venture of United Enterprises & Co Ltd, Posco International Corp and Korea Gas Corporation and consortium of Sumitomo Corporation and Chugoko Electric Power Co. Inc.
Sources said of the two new FSRUs, Summit Group last week obtained final government approval for building its second FSRU.
Summit will build the new FSRU near its existing one on Moheshkhali island under Cox's Bazar district in the Bay of Bengal.
The new FSRU will have the capacity to re-gasify around 171,000 cubic meters of LNG with the send-out capacity of 600 million cubic feet per day (mmcfd).
With the Summit's new FSRU, the country's total FSRU will be four in total by 2026 - two of Summit's and another two of Excelerate Energy's.
In early November Petrobangla inked a term-sheet agreement with the Excelerate Energy to build a new FSRU on BOOT basis with an initial capacity to re-gasify 3.75 million tonnes per year.
Currently, two FSRUs are operational in Bangladesh, of which one is owned by Summit Group and another owned by Excelerate Energy of the United States.
Each of the FSRUs has capacity to re-gasify around 500mmcfd LNG.
Petrobangla last month also inked a deal for expansion of Excelerate Energy's FSRU-Excellence -by 20 per cent to 600mmcfd.
The country's overall LNG-regasification capacity will thus increase 120 per cent to around 2,200mmcfd by 2026 from existing 1,000mmcfd.
"The government should build the land-based LNG-import terminal immediately," says energy-expert Professor M Tamim.
Land-based LNG terminal will be cost-effective, which will be able to re-gasify LNG stably.
FSRU is considered temporary solution, while land-based LNG terminal is a permanent one, notes Mr Tamim, who was the chief of the MPEMR during the previous caretaker government.
Azzizjst@yahoo.com