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Bangladesh completes first pipeline for regasified LNG, plans 3 more

Bangladesh completes first pipeline for regasified LNG, plans 3 more

DHAKA: Bangladesh has completed construction of its first dedicated pipeline to move regasified LNG to end-users and has three more in the works, state-run Gas Transmission Company Ltd managing director Md Atiquzzaman said Monday. The 91 km (56 mile) 30-inch natural gas pipeline from Moheshkhali to Anowara, with a capacity of up to 800,000 Mcf/d, has been completed and undergone the necessary testing, he said.

A parallel 79 km 42-inch pipeline is currently under construction to carry additional volumes of imported regasified LNG from Moheshkhali to Anowara, which is due for completion in 2018, he said. Atiquzzaman said construction of another 30-km 40-inch pipeline is under way to carry imported regasified LNG from Anowara to Fouzdarhat and supply it to end-users in the port city Chittagong. Another 181 km 36-inch Chittagong-Feni-Bakhrabad gas transmission pipeline would also be laid down soon to distribute supply across the country from Chittagong, he added. GTCL, a wholly owned subsidiary of state-owned Petrobangla, is responsible for building and maintaining the country’s gas pipelines.

Bangladesh eyes starting LNG imports in early 2018 and is making concerted efforts to move forward with LNG import infrastructure. The country’s first LNG import terminal, a 3.75 million mt/year FSRU being developed by US-based Excelerate Energy, is expected to be commissioned in April 2018 and its second, also with a capacity of 3.75 million mt/year, being developed by Summit Group, is expected to be commissioned by end 2018. Both will be located at Moheshkhali Island in the Bay of Bengal, with ownership to be transferred to Petrobangla after 15 years of operations.

Petrobangla is also planning to set up at least two onshore LNG terminals, each with a capacity of 7.5 million mt/year, by 2025. Petrobangla on July 13 inked its first ever deal with Qatar’s RasGas to import 2.5 million mt/year of lean LNG for 15 years, S&P Global Platts reported earlier. Separately, Petrobangla has signed an MOU with Switzerland-based AOT Energy on LNG, with an SPA due to be signed by year end. It also recently issued an international tender seeking expressions of interest to supply LNG on a spot basis, which closes August 17. Although Petrobangla’s contract with RasGas will be priced against international crude benchmarks, Petrobangla is counting on government subsidies to enable it to pay for the imported LNG. Earlier this year, the company requested a subsidy of $1.4 billion from the government to foot its LNG import bill for 2018 — some 78% of the total estimated cost. Subsidies will be aimed at bridging the wide gap between international LNG prices and domestic gas prices. Demand for natural gas, which accounts for more than 70% of Bangladesh’s energy fuel consumption, is expected to continue growing steadily to close to 7 Bcf/d by 2040, according to Petrobangla, while production is expected to peak above 3.5 Bcf/d by 2023.