5:08 pm - Tuesday February 21, 0215

Govt puts LNG terminal project on fast-track route

The government has put the country’s first LNG import terminal project on a fast-track route for implementation on a priority basis, to ease the country’s energy crisis and accelerate economic growth, said Petrobangla Chairman Hussain Monsur.

The first meeting of the Fast Track Project Monitoring Committee, chaired by Prime Minister Sheikh Hasina, held in Dhaka on Wednesday identified the project as fast-track one, among others.

petro banglaDuring the meeting, the prime minister directed the Energy and Mineral Resources Division under the Ministry of Power, Energy and Mineral Resources to start implementing the LNG terminal project immediately.

As a result, state-owned Petrobangla — which is spearheading the project — is due to submit a work plan to the EMRD by next week, said a source who attended the meeting.

A week before the national elections — which were held on January 5 — Hasina, as part of her campaign pledges, said Bangladesh would start importing LNG within five years after building key infrastructure including a floating import terminal in the Bay of Bengal. Hasina is leader of the Bangladesh Awami League political party, which regained power after winning a two-third majority in the polls.

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 would have berthing and mooring facilities for LNG vessels with a capacity of 138,000-260,000 cubic meters, with Petrobangla looking to award the construction contract on a build-own-operate-transfer basis for 15 years.

Petrobangla floated the construction tender in November 2010, and selected a US consortium comprising Astra Oil and Excelerate Energy in August 2012. But the award of the tender was delayed due to factors such as procedural delays and lack of funds.

In November 2013, the country’s energy ministry approved revised terms for the tender and the US consortium finally agreed later that month to move ahead with the project.

Bangladesh has already extended its memorandum of understanding with Qatar over the import of LNG, which expired in March 2013, until June 2015, as it is confident it will be able to import LNG by then after completing the floating LNG terminal project.

Bangladesh signed the MOU with Qatar Petroleum in January 2011 to import 4 million mt/year of LNG, but has yet to receive any imports as it has no receiving infrastructure.

Building the LNG import terminal is critical for the energy-starved southeastern Chittagong region, Mahbubul Alam, president of the Chittagong Chamber of Commerce and Industry, has said previously.

Chittagong, which was once almost self-reliant in natural gas, started facing a supply crisis in 2006 as output diminished from the Sangu gas field, he said. Bangladesh’s sole offshore gas well, Sangu-11, was permanently closed in October 2013.

Courtesy: platts.com