Bangladesh will ink an initial agreement in end-May with the US consortium comprising Astra Oil and Excelerate Energy for building the country’s first LNG import terminal at Moheshkhali Island, a senior Petrobangla official said Friday.
The Astra Oil and Excelerate Energy consortium was selected to build the terminal in August 2012, but the US companies wanted to reach an agreement on maintenance fees before signing the final construction deal.
Petrobangla has now agreed to provide maintenance fees to keep the proposed LNG terminal operative until imports start, the official said.
Top officials from Petrobangla and Bangladesh’s Energy and Mineral Resources Division under the Ministry of Power, Energy and Mineral Resources, and representatives from the US consortium met in Dhaka Thursday to resolve almost all issues regarding the contract, the official said.
The fees would cover the cost of maintaining a completed terminal in the event there was a delay in the start of LNG imports, the official said.
Bangladesh has extended a memorandum of understanding with Qatar for the import of 4 million mt/year of LNG, which expired in March 2013, until June 2015 and is confident of completing the floating LNG terminal project by then.
However, it has not yet signed a final import agreement, which prompted the US consortium to seek maintenance fees.
In its final letter to Petrobangla last month, the US consortium agreed to pay a $2 million bid bond and a penalty if it failed to provide the required services and to provide a $20 million performance guarantee, the official said.
Petrobangla is planning a floating LNG import terminal with a capacity to handle 5 million mt/year of LNG and a regasification capacity of at least 500,000 Mcf/d at MoheshkhaliIsland in the Bay of Bengal.
It will have berthing and mooring facilities for LNG vessels with a capacity of 138,000-260,000 cubic meters.
Bangladesh is eyeing to ink the final deal with the US group by December 2014 and start importing LNG in 2016. The deal will be awarded on a build-own-operate-transfer basis for 15 years.