15-year LNG supply deal with Summit

The government has inked a new 15-year long-term LNG-supply contract with Summit Group for an estimated 1.5 million tonne per annum (MTPA) starting from January 2026, according to Petrobangla.
The state-owned oil, gas and mineral corporation, known as Petrobangla, recently inked a sales-and-purchase agreement (SPA) to buy LNG (liquefied natural gas).
Another deal was done for building a 4.5-MTPA capacity floating storage and regasification unit (FSRU) by the privately-owned home energy giant, they said.
The proposed FSRU will be the third such facility in Bangladesh.
"It's a great honour and responsibility to support the energy infrastructure of Bangladesh. With these, our investment here will exceed Tk 320 billion ($3.0 billion) in power, energy, ports and telecoms," said Summit Group chairman Muhammed Aziz Khan.
"Bangladesh continues to be the best place for Summit's investments. Way to go," he told the FE on Tuesday.
Petrobangla inked these deals following approval from the cabinet committee on government purchase on 06 December 2023 to award Summit with a contract to build its second FSRU near the existing one at Moheshkhali island in the Bay of Bengal.
The other agreement is to supply LNG in the long term.
According to the SPA, a senior Petrobangla official said, Summit subsidiary 'Summit Oil & Shipping Company Ltd (SOSCL)' would supply LNG for 15 years from 2026.
The price of LNG will be around 13 per cent of three months' average Brent crude price, he added.
This is the fourth of the new SPAs with suppliers for long-term procurement since June 2023, and the new suppliers will start delivering LNG from 2026 onwards.
Apart from the SOSCL, Petrobangla inked SPAs with the Qatar Energy Trading LLC, the OQ Trading Ltd of Oman and the Excelerate Gas Marketing Ltd Partnership of the USA over the last one year, said the official.
Currently, Qatargas and OQ Trading are supplying LNG to Bangladesh under two long-term SPAs.
Summit LNG Terminal II Ltd, another subsidiary, will build the 170,000-cubic metre FSRU with 600 mmcfd (million cubic feet per day) send-out capacity.
Summit's existing 3.75-MTPA regasification unit started its commercial operation on 30 April 2019 and it will be operational for 15 years until 2033.
The operation of Summit's existing FSRU, Summit LNG Terminal, has remained halted since May 30 after damage was spotted from the impact of a stray pontoon during cyclone Remal that made landfall last week.
"The FSRU's ballast water tank had been damaged after a stray broken floating pontoon hit," revealed an official statement from Summit Group.
US-based Excelerate Energy's FSRU, Excellence, is currently regasifying LNG above its official capacity of 600 mmcfd to meet the country's gas demand due to a halt in the operation of the Summit-led FSRU.
Mr Khan said Japan's gas and power utility JERA was likely to be a part of Summit's LNG supply business, referring to its long-term SPA, but did not elaborate.
Separately, Summit Group is also looking to establish Bangladesh's first onshore LNG terminal on a build-own-operate-and-transfer (BOOT) basis at Matarbari island in the Bay, according to him.
Summit Corporation Ltd, a subsidiary of Summit Group, has teamed up with JERA and Mitsubishi Corporation, and been shortlisted along with seven other consortiums to build the 7.50-MTPA land-based LNG terminal, he cited.

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