Govt allows 2 pvt firms to import LNG for 1st time

Two private companies were given the go-ahead to import liquefied natural gas for the first time under two long-term contracts.

Summit Group and Excelerate Energy got the permission to import and supply the super-chilled fuel up to 1.5 million tonnes per annum (MTPA) from 2026.

The cabinet committee on economic affairs yesterday approved in principle the proposals of these two companies, regarding LNG import, placed by the ministry of energy, power and mineral resources.

The government has separate government-to-government (G2G) deals with Oman and Qatar, under which LNG is imported on a long-term basis. Besides, it purchases two to three cargoes of LNG from the international spot market every month.

From now on, in addition to the G2G deals and spot market purchases, Summit and Excelerate will also import LNG and sell it to the government.

On August 1, the ministry of energy, power and mineral resources formulated new LNG importing regulations, which allow private companies to import LNG and sell it to the government.

However, it is unclear whether the private companies will be able to sell LNG to other private companies. This correspondent could not contact the officials concerned for comments despite repeated attempts.

"Due to the increasing demand for natural gas and the decreasing reserve of local gas fields, it was challenging for us to meet the demand. An increase in economic activities will further widen the gap between the demand and supply of natural gas in the future. Under the circumstances, the government has identified imported liquefied natural gas as a major alternative to the country's natural gas," reads the recently amended regulations.

"The government is now importing LNG under G2G (government to government) contracts, but it will need to encourage the private sector's involvement to ensure the uninterrupted supply and highest utilisation," it added.

Bangladeshi conglomerate Summit and US gas shipping company Excelerate -- they each have one Floating Storage Regasification Unit (FSRU) in Cox's Bazar. FSRUs are terminals for regasification of LNG. Summit and Excelerate receive payment from the government for regasification at their respective FSRUs.

Earlier in June, Summit got the government nod to build its second FSRU.

In another meeting of the cabinet committee on purchase, three gas-fired power plants, owned by Summit, got a five-year extension. The plants are in Ashulia, Madhabdi and Chandina. They have a power generation capacity of 71.55MW.

"With this extension, Summit will receive Tk 1,118 crore in the extended period at a cost of Tk 5.64 per unit electricity," reads the meeting minutes.

The purchase committee also approved the import of 33.60 lakh MMBtu LNG from the spot market from TotalEnergies Gas and Power Ltd of Switzerland. The shipment will cost Tk 478.64 crore in total and per unit cost will be $11.17.

The committee also approved a 50MW solar power plant in Nilphamari's Dimla upazila. From this power plant, the Bangladesh Power Development Board will purchase electricity at a rate of Tk 10.69 per kilowatt-hour.

According to the meeting minutes, the food ministry will purchase 50,000 tonnes of wheat from Agrocorp International Pte of Singapore at a cost of $297.47 per tonne.

The ministry of commerce will purchase 160 lakh litre soybean oil for the Trading Company of Bangladesh (TCB), at a cost of Tk 159.45 per litre from Bashundhara Multi Food Products Ltd.