For prudent planning in the energy sector
Thursday, 11 March 2010
Enayet Rasul Bhuiyan
IN the backdrop of severe shortage of gas in the country, it makes sense to set up at least one LNG (liquefied natural gas) terminal to receive LNG in the desired quantities and after regasification the same can be promptly used to run power plants that now remain closed down from no supply of gas. The LNG terminal will take the shortest possible time ( probably less than a year ) to be set up. But its installation will help in the generation of substantial power at the fastest from existing power plants to mitigate notably the power crisis.
It is estimated that it will take some years to explore and exploit coal and effectively diversify the energy basket. Even if the government starts in earnest to explore the off-shore resources it will take not less than five to six years to reap a harvest from the offshore petroleum exploration; it may take a few years to derive benefit from the regional energy ring. But the Bangladesh economy will run into disaster if some contingency actions are not taken immediately to tide over these difficulties.
Import of liquefied natural gas (LNG) can be a ready solution to these growing energy problems. If aggressive actions can be taken in this area, it is possible to reap benefits relatively faster. If we consider overall impacts of about 500 MMCFD gas injections to our ailing economy by building in about a year's time a system based on LNG imports, the gains will outstrip pains many times.
Some of our Asian giant economies like Japan, Korea and Taiwan are mostly dependent on imported LNG as they do not have any basic energy resource. To meet the demands of their expanding economy China and India have taken up the LNG route in a massive way. LNG technology is evolving fast and it may no longer need massive LNG regasification plants and receiving terminals. Much smaller low draft LNG ships and floating LNG terminals are creating revolution in LNG trade and use.
Bangladesh does not appear to have any better contingency option other than LNG import to address the very acute gas crisis in Chittagong. If appropriate action can be taken, the companies which have this technology can set up terminals at an appropriate offshore location in one working season-- may be October-March 2010-11 so that gas may flow to Chittagong and national gas grid by as early as January 2011. From the injection of gas through LNG imports, well over 1,000 mw can be readily produced from fully starting production in power plants that now remain closed or operate far below capacity, from gas shortage. The optimum capacities of the ones which are only functioning partly due to insufficient gas supply, will then be possible. If even 1,200 mw can be produced swiftly through implementation of the LNG scheme, then that would largely reduce the severity of load shedding in the country as the deficit of power in peak period is estimated to be some 1,500 mw only.
Contrast this with the move to import power from India. Only laying structures to receive the power would take at least two years, if not more. Then, only about 250 mw would be received which is a pittance compared to the need. The power import process from India is a prohibitive one in terms of costs. Besides, it is doubted that India will have any excess power to sell to Bangladesh even in the medium term. So, why this obsession for buying such a paltry amount of power from India at high costs when a better alternative, in the sense of both time and the amount of power to be produced within the country, lies in opting for the LNG option?
According to media reports, the government is now quite active to bring power from India. If this power import could be made in a very short period of time, the same would make some sense. But after completing at least two years in establishing infrastructures in both countries and then getting the power, the same must raise many questions. Why has Bangladesh to go for such cumbersome and delaying process to import power and make itself dependent on external power supply when it had never done so and when all countries usually consider self-reliance in power as basic to their security in all respects ?
The issues at stake could be compromised if urgent import of the very badly needed power could be assured through such an arrangement. When this would not be the case, then why is this scramble for importing power from a neighbour? It would be cost efficient as well as strategically sound to produce that power within the country through its own resources and means. The same is possible through establishing rental power plants, and through a crash programme to import LNG. Proposals are reportedly lying with the ministry from foreign companies in the energy sector who are all ready to tap the gas found in vast pockets in coal fields of the country and use the same for producing power.
Besides, if power has to be imported, the same can be imported from Myanmar which already has much excess of power. Logistically, bringing the excess power from Myanmar will also likely be comparatively cheaper than bringing the same from India. Besides, power import from Myanmar can be sustainable in the background of the slow growth of that country's economy and the already notable power surplus enjoyed by it.
The government has recently contracted deals for the establishment of four large sized power plants with a company of Indian origin to be run also very likely by coal imported from India. But why build power plants to run with imported coal when Bangladesh has huge discovered coal reserves of the highest quality? Why not resolve at the soonest the meaningless debate over coal extraction -- whether open pit mining or tunneling -- and use the local coal that would be beneficial to a far higher degree for the economy in all respects than running such plants with imported coal?
IN the backdrop of severe shortage of gas in the country, it makes sense to set up at least one LNG (liquefied natural gas) terminal to receive LNG in the desired quantities and after regasification the same can be promptly used to run power plants that now remain closed down from no supply of gas. The LNG terminal will take the shortest possible time ( probably less than a year ) to be set up. But its installation will help in the generation of substantial power at the fastest from existing power plants to mitigate notably the power crisis.
It is estimated that it will take some years to explore and exploit coal and effectively diversify the energy basket. Even if the government starts in earnest to explore the off-shore resources it will take not less than five to six years to reap a harvest from the offshore petroleum exploration; it may take a few years to derive benefit from the regional energy ring. But the Bangladesh economy will run into disaster if some contingency actions are not taken immediately to tide over these difficulties.
Import of liquefied natural gas (LNG) can be a ready solution to these growing energy problems. If aggressive actions can be taken in this area, it is possible to reap benefits relatively faster. If we consider overall impacts of about 500 MMCFD gas injections to our ailing economy by building in about a year's time a system based on LNG imports, the gains will outstrip pains many times.
Some of our Asian giant economies like Japan, Korea and Taiwan are mostly dependent on imported LNG as they do not have any basic energy resource. To meet the demands of their expanding economy China and India have taken up the LNG route in a massive way. LNG technology is evolving fast and it may no longer need massive LNG regasification plants and receiving terminals. Much smaller low draft LNG ships and floating LNG terminals are creating revolution in LNG trade and use.
Bangladesh does not appear to have any better contingency option other than LNG import to address the very acute gas crisis in Chittagong. If appropriate action can be taken, the companies which have this technology can set up terminals at an appropriate offshore location in one working season-- may be October-March 2010-11 so that gas may flow to Chittagong and national gas grid by as early as January 2011. From the injection of gas through LNG imports, well over 1,000 mw can be readily produced from fully starting production in power plants that now remain closed or operate far below capacity, from gas shortage. The optimum capacities of the ones which are only functioning partly due to insufficient gas supply, will then be possible. If even 1,200 mw can be produced swiftly through implementation of the LNG scheme, then that would largely reduce the severity of load shedding in the country as the deficit of power in peak period is estimated to be some 1,500 mw only.
Contrast this with the move to import power from India. Only laying structures to receive the power would take at least two years, if not more. Then, only about 250 mw would be received which is a pittance compared to the need. The power import process from India is a prohibitive one in terms of costs. Besides, it is doubted that India will have any excess power to sell to Bangladesh even in the medium term. So, why this obsession for buying such a paltry amount of power from India at high costs when a better alternative, in the sense of both time and the amount of power to be produced within the country, lies in opting for the LNG option?
According to media reports, the government is now quite active to bring power from India. If this power import could be made in a very short period of time, the same would make some sense. But after completing at least two years in establishing infrastructures in both countries and then getting the power, the same must raise many questions. Why has Bangladesh to go for such cumbersome and delaying process to import power and make itself dependent on external power supply when it had never done so and when all countries usually consider self-reliance in power as basic to their security in all respects ?
The issues at stake could be compromised if urgent import of the very badly needed power could be assured through such an arrangement. When this would not be the case, then why is this scramble for importing power from a neighbour? It would be cost efficient as well as strategically sound to produce that power within the country through its own resources and means. The same is possible through establishing rental power plants, and through a crash programme to import LNG. Proposals are reportedly lying with the ministry from foreign companies in the energy sector who are all ready to tap the gas found in vast pockets in coal fields of the country and use the same for producing power.
Besides, if power has to be imported, the same can be imported from Myanmar which already has much excess of power. Logistically, bringing the excess power from Myanmar will also likely be comparatively cheaper than bringing the same from India. Besides, power import from Myanmar can be sustainable in the background of the slow growth of that country's economy and the already notable power surplus enjoyed by it.
The government has recently contracted deals for the establishment of four large sized power plants with a company of Indian origin to be run also very likely by coal imported from India. But why build power plants to run with imported coal when Bangladesh has huge discovered coal reserves of the highest quality? Why not resolve at the soonest the meaningless debate over coal extraction -- whether open pit mining or tunneling -- and use the local coal that would be beneficial to a far higher degree for the economy in all respects than running such plants with imported coal?