Bangladesh to procure 8 LNG cargoes from spot market

    Originally posted in Dhaka Tribune on 12 February 2023

    The government will import eight LNG cargoes from the international spot market until June later this year to feed the country’s energy starved consumers, especially the export-oriented industries and power plants, said State Minister for Power, Energy and Mineral Resources Nasrul Hamid.

    The minister, however, did not say anything in detail about month-wise LNG cargo imports from the spot market.

    State-run Petrobangla will have to pay around Tk6,800 crore to import these LNG cargoes from the spot market considering the current market price, reports the Financial Express.

    First of the LNG cargoes from the international market are all set to be delivered during February 21-22 to Matarbari floating, storage and re-gasification unit (FSRU) by French firm TotalEnergies.

    TotalEnergies will supply around 3.36 million MMBTU of LNG at $19.78 per million British Thermal Unit (MMBTu) at the cost of Tk850 crore, said a senior Petrobangla official.

    Separately, the South Asian country will be importing a total of three LNG cargoes in February from its two existing long term LNG suppliers — two cargoes from Qatargas and one cargo from Oman Trading International, or OTI, currently known as OQ.

    Bangladesh had imported its previous LNG cargo from the spot market seven months ago during June 22-23, 2022 delivery to its Moheshkhali FSRU at S$24.75 per MMBTU.

    Gunvor Singapore Pte Ltd had supplied the LNG cargo having the quantity of 138,000 cubic metres.

    Bangladesh will start importing increased quantities of LNG regularly from the spot market from March, Petrobangla Chairman Zanendra Nath Sarker told S&P Global Commodity Insights earlier.

    Bangladesh has a target to ramp up the country’s overall natural-gas output at least by over 13.20% to more than 3,000 MMcf/d as industries seek uninterrupted gas supply to keep the wheel rolling on a full scale in the process of a rebound, he said.

    Bangladesh’s overall natural gas supply now hovers around 2,612MMcf/d with re-gasified LNG of around 381 million cubic feet per day (mmcfd), according to official data of Petrobangla as on February 10, 2023.

    The country will increase the supply of re-gasified LNG to around 700 mmcfd during next summer, he said.

    Bangladesh raised the natural gas tariffs by up to 178.88% through an executive order last month, which came into effect from February 1, to secure funds for importing increased quantities of LNG and to meet the growing domestic demands especially in industries and ensure uninterrupted supply of gas to the consumers.

    Bangladesh had ceased importing LNG from the spot market since July 2022 amid its price volatility and fund constraints in the wake of a global crisis.

    Qatargas and OQ Trading will supply a total of 56 LNG cargoes in 2023, the same cargoes as they supplied during 2022, according to Petrobangla.