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Bangladesh seeks expressions of interest to supply spot LNG

Bangladesh seeks expressions of interest to supply spot LNG

DHAKA: Bangladesh has issued an international tender seeking expressions of interest by July 30 to supply LNG on a spot basis, state-run Petrobangla’s LNG chief Md Quamruzzman said Monday. “We plan to pick a pool of 10-12 LNG suppliers who would be interested in supplying LNG to us on a spot basis in response to our requests,” he said. The tender is in line with the Bangladesh government’s policy of importing LNG via both long-term contracts and spot deals to achieve competitive prices, the country’s State Minister for the Ministry of Power, Energy and Mineral Resources, Nasrul Hamid, told S&P Global Platts last Thursday. The volumes to be supplied under spot deals and long-term contracts has yet to be decided. The short listed spot suppliers will be asked to submit quotes for supplying LNG from time to time, when Petrobangla deemed it necessary, Quamruzzman said.

They will be asked supply lean LNG as per specifications on a delivery ex-ship basis to either floating and land-based storage and re-gasification units currently being set up, he added. To facilitate long-term imports, state-run Petrobangla signed a memorandum of understanding with Switzerland-based AOT Energy last Tuesday to supply LNG, with a sales and purchase agreement due to be signed by year end. This is on top of an MOU signed with Qatar’s RasGas in January 2011 for the supply of 4 million mt/year of LNG. Negotiations with RasGas and AOT Energy were also underway, Quamruzzman said last week.

Bangladesh eyes starting LNG imports in early 2018 as the country’s first LNG import terminal, a 3.75 million mt/year floating storage and regasification unit being developed by US-based Excelerate Energy, is expected to be commissioned next April. The country’s second FSRU, also with a capacity of 3.75 million mt/year, is being developed by Summit Group, with commissioning expected by October 2018. Petrobangla is also planning to set up two onshore LNG terminals, each with a capacity of 7.5 million mt/year, by 2025. The company signed an MOU with India’s Petronet in December to build one on Kutubdia Island and issued an international tender in April seeking bids for the construction of the second. Petrobangla has already moved to seek around $1.4 billion in subsidies from the government to foot its LNG import bill in 2018, as it will not be able to cover the cost through domestic sales, Quamruzzman said earlier. Bangladesh has moved to import LNG as it is reeling under an acute natural gas shortage, with daily average output of around 2.70 Bcf against demand of over 3.30 Bcf/d, according to Petrobangla.