BD inks MoU with Oman to import LNG

M Azizur Rahman | Wednesday, 13 September 2017

Bangladesh inked a memorandum of understanding (MoU) with Oman last week for LNG (liquefied natural gas) imports, said officials.
State-run Petrobangla will now initiate negotiation with Oman LNG soon to fix up volume, price and specification of the LNG to imported from the Middle Eastern country, said a senior official of the Energy and Mineral Resources Division under the Ministry of Power, Energy and Mineral Resources.
He said Bangladesh will import lean LNG similar to natural gas produced from Bangladesh's domestic fields, which will be blended with domestic gas before delivery to end-users.
This is Bangladesh's third LNG supply agreement, as the country is faced with declining natural gas reserves and mounting demand from downstream power and fertiliser sectors.
Petrobangla earlier inked an initial agreement on July 13 to import annually around 2.5 million tonne of lean LNG from Qatar's RasGas over 15 years.
Bangladesh's Cabinet Committee on Public Purchase has approved the initial deal on August 30 and a final deal is expected to be inked in September, said a senior Petrobangla official.
Petrobangla and Switzerland-based AOT Energy signed a MoU on June 13 over LNG supplies to Bangladesh.
Bangladesh did not elaborate on the quality of LNG to be imported from these companies but said it would be similar to the specifications set for spot LNG.
Rupantarita Prakritik Gas Company Ltd (RPGCL), a wholly-owned subsidiary of Petrobangla in charge of the country's LNG purchases, has set out specifications for spot LNG it would import separately.
Under the specifications, the imported LNG should have a gross heating value within the range of 1,025-1,100 Btu (British Thermal Unit) per scf (square cubic feet).
Since the imported LNG is to be blended with sulfur-free, sweet gas produced domestically, the sulfur content in the imported LNG should be low, said a senior RPGCL official.
RPGCL also has received expressions of interests from 39 global firms to supply LNG on a spot basis on August 17.
A dozen of companies would be short-listed within September to start negotiation for importing LNG from spot market, said the RPGCL official.
Bangladesh's first LNG import terminal, a 3.75 million tonne per year FSRU (floating, storage, re-gasification unit) being developed by US-based Excelerate Energy, is expected to be commissioned by April 2018.
A second FSRU, having similar capacity, is also expected to be commissioned by end-2018.
Both FSRUs will be located at Moheshkhali Island in the Bay of Bengal, and ownership of the vessels will be transferred to Petrobangla after 15 years of operations. Petrobangla is also planning to set up at least two onshore LNG terminals, each with a capacity of 7.5 million tonne per year, by 2025.
Bangladesh will need imports of around 30 million tonne per year of LNG to meet mounting demand from various sectors including industries, power plants and fertiliser plants by 2041 as domestic gas reserves are depleting fast, according to the final report Bangladesh's Gas Sector Master Plan 2017.
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