Six years after the initiative was taken, the government has finally completed all formalities to build Bangladesh's first floating storage and regasification unit (FSRU) – popularly known as liquefied natural gas (LNG) processing terminal – in Maheshkhali, Cox's Bazar.
Two agreements in this regard were signed between the government and Excelerate Energy Bangladesh Limited (EEBL), a subsidiary of US-based Excelerate Energy, at Petrobangla auditorium in Dhaka on Monday.
One agreement, on the project implementation, was signed between EEBL and Energy and Mineral Resources Division, and the other agreement, on terminal use, was signed between EEBL and the state-owned Bangladesh Oil, Gas and Mineral Corporation – more commonly known as Petrobangla.
According to the deals, the FSRU will be built on a built-own-operate-transfer basis and process imported LNG into natural gas. When fully operational, the terminal will add 500mmcfd – million cubic feet per day – of natural gas to the national grid.
Tawfiq-e-Elahi Chowdhury, energy adviser to the prime minister who was present at the signing ceremony, termed the agreement signing “a milestone.”
“Paperwork for the project implementation has been finalised today. Some of the groundwork has also been finished. We are hoping to see around 500mmcfd of gas being supplied by this FSRU by the end of next year,” he said at the ceremony.
He also said in terms of investment, this project may not a big one, but it certainly is critical for Bangladesh.
Daniel Bustos, chief development officer of EEBL, also termed it critical and said through this project, Bangladesh is entering the global LNG market. “I hope this LNG terminal will provide Bangladesh a gateway to new energy access.”
Bustos further said it was for the first time that a single entity was providing a complete solution in this sector. “We will implement the project on build-own-operate-transfer basis. Once in operation, the Maheshkhali terminal will significantly improve the energy situation in Bangladesh.”
Nasrul Hamid, state minister for power, energy and mineral resources, said prices of gas would be increased to some extent in near future as LNG price is higher than that of natural gas. “The country's energy sector has to be competitive in terms of prices.”
Although the FSRU would be adding 500 mmcfd of natural gas to the national grid, Nasrul said it was not enough to meet the national demand. “We will be needing 3,500 mmcfd of gas in the future to ensure sustainable development as well as smooth electricity supply and industrial production."
He said the government had received offers for the construction of two more FSRUs in the country.
The agreement signing was attended by, among others, Nazimuddin Chowdhury, secretary, and Zanendra Nath Sarkar, deputy secretary at Energy and Mineral Resources Division, Istiaque Ahmed, chairman, and Syed Ashfaquzzaman, secretary at Petrobangla, and Marcia Bernicat, US ambassador to Bangladesh.