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Dhaka Friday,  Mar 29, 2024

PMO for analysing LNG price in int’l market to set tariff

Shahnaj Begum

The Prime Minister’s Office has directed the Energy Ministry to analyse Liquefied Natural Gas price in the international market to fix up tariff of imported LNG.
In a bid to import 500mmcf gas (equivalent to LNG) per day, the government has planned to install country’s first LNG terminal at Maheshkhali in next two years, according to PMO officials.
The PMO directives came before a meeting between Petrobangla, the state owned oil and gas corporation, and the US-based Astra Oil-Excelerate Energy (AE) Consortium, on Monday on “Met-Ocean” report prepared by AE because of its importance.
AE representatives apprised Petrobangla that they needed 20 months more to install floating storage and re-gasification unit (FSRU), popularly known as  LNG terminal.
The meeting discussed the Met-Ocean Report and the Petrobangla wanted to know the capacity of the consortium and technical aspects of FSRU.
In May last AE Consortium submitted its report to Petrobangla where it claimed that ‘the availability of this terminal will be 96.2 per cent,’ without elaborating on the related things like weather condition, wave-height, tidal situation risk factors, a Petrobangla official said.
In the meeting, the Petrobangla wanted to know at a great length why FSRU cannot be used fully, the official told this correspondent.
After analysing the weather and characteristics of the Bay of Bengal at Maheshkhali point, the AE has submitted the report.
“Basically AE completed the study on the basis of historical data, it is the industry’s practice. But at the same time the scenario has changed due to climate change, more than that this report should be matched with the LNG suppliers requirement,” Mohammad Quamruzzaman, Director PSC and head of the five-member technical committee of the LNG project, who presided over the meeting, said.
According to Energy Ministry sources, the ministry needed huge subsidy to import LNG from international market. However, the government initially apprised Qatar Petroleum Corporation that they would procure LNG from Qatar, though formal decision was yet to be taken.
According to Petrobangla, agreement on terminal use would be signed in November.
A high-powered delegation comprising technical, financial and legal experts of the AE Consortium sat with us to share “met-ocean’ study report for the proposed floating storage and re-gasification unit (FSRU) known as LNG terminal at Moheshkhali as there were many issues that needs to be discussed, a Petrobangla top official said.
Meanwhile, the state run oil company has completed the “met-ocean’ study at a cost of around US$0.15 million. With plans to conduct a $12 million ‘geo-technical’ study.
Petrobangla signed an initial contract in November, 2014 with the AE Consortium for setting up the country’s first floating storage and re-gasification unit (FSRU) at Maheshkhali island to import 500mmcfd of gas. The programme is aimed at reducing the growing fuel crisis in the country.
The AE has agreed to transfer FSRU to Petrobangla without any cost after 15 years with re-gasification tariff at $0.39 per mmcfd ((million cubic feet per day). All the gas-fired power projects in Chittagong have remained shut due to scarcity of gas there.
It is gathered that the government plans to import LNG from Qatar at a cost of $16 per unit to run the LNG terminal.

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