Two bodies on LNG fund hunt, consumer pricing

The government has formed two bodies to find sources for funding the import of liquefied natural gas (LNG) and fix its price at consumer level, as the fuel-import move progressed.
Officials said efforts are underway to supply the cleanest hydrocarbon by middle of next year.
As the shortage of natural gas supply from local fields is affecting power generation as well as industries and households, the government opted for importing LNG to meet the demand. Presently, local fields can supply gas amounting to around 2,700 million cubic feet per day against the demand for 3,300 MMCFD.
The energy division estimates that gas demand may touch 8,000 MMCFD by 2041 but supply from local sources may go down by then substantially unless new gas fields are discovered.
Sources said the Prime Minister Office (PMO) recently held a meeting with energy adviser Dr Tawfiq-e-Elahi Chowdhury in the chair. The adviser told the meeting that each year LNG worth several billion dollars will be needed to feed the consumers.
He said the shortage of natural gas from local sources has to be met by importing LNG. In the future imported LNG will be a major source of energy which is a prerequisite for raising investment, setting up industrial units, and overall economic growth in the country.
The energy adviser also said the funding sources for LNG import need to be identified alongside fixing a reasonable price of it at the consumers' level.
He informed the FE that a process is underway for floating US$1.0 billion international bond by the Bangladesh Power Development Board (BPDB) and Tk 5.0 billion by Ashuganj Power Plant to foot the LNG-import bill.
The meeting formed an eight-member body, headed by the power division's additional secretary, to look for LNG funding sources. The committee has been asked to explore both local and foreign sources, examine the prospect of funding by the central bank and stock markets, and submit a report with recommendations within a month.
Another 10-member committee, led by the finance division's additional secretary, was also formed and charged with the task of studying gas prices at consumer level following LNG import, implementation of price enhancement in phases at consumer level, and providing subsidy to keep the price reasonable.
Bangladesh Oil, Gas and Mineral Corporation, widely known as Petrobangla, will import LNG from Oman, Qatar and Switzerland and will supply it to national grid after re-gasification.
To this end, Petrobangla has so far signed deals with three companies for setting up three floating terminals for storage and re-gasification of LNG. Setting up a land-based LNG terminal is also under consideration. And the government has already received over a dozen proposals.
US-based Excelerate Energy is constructing country's first LNG terminal while local conglomerate Summit Group building a second one. The terminals are expected to be commissioned by April 2018 and end of 2018 respectively.
The petroleum corporation recently also signed a term-sheet agreement with a consortium of local Hong Kong Shanghai Manjala Power Ltd (HSMPL) and Malaysia's Global LNG and Petronas LNG Ltd for using country's third floating LNG re-gasification terminal. The consortium will build the terminal within 18 to 20 months of the signing of a final deal.

syful-islam@outlook.com