Bangladesh to buy 1m tonnes LNG yearly from Excelerate Energy

Bangladesh has entered into a long-term sales and purchase agreement with USA-based Excelerate Energy to purchase liquefied natural gas (LNG) for 15 years starting in 2026.

The agreement will enable the second-largest economy in South Asia to buy 1 million tonnes of LNG per year from the American company.

Officials from Excelerate Energy and Petrobangla signed the contract on behalf of their respective sides on Wednesday at a hotel in the capital.

Additionally, the parties struck agreements on the Moheshkhali LNG Expansion and Payra Term Sheet Agreement.

In a video message, Steven Kobos, president and chief executive officer at Excelerate Energy, said Bangladesh is one of the most dynamic LNG markets in the world, and Excelerate has played a significant role since the country began importing LNG.

"Natural gas is critical to Bangladesh's economy, and we are keen to help the country meet its rapidly growing energy needs through our partnership with Petrobangla," he said.

US Ambassador in Dhaka Peter Haas, who attended the event as a special guest, said this agreement will help Bangladesh ensure energy security. 

In his welcome speech, Ramon Wangdi, vice president (Asia Pacific) at Excelerate Energy, said the 15-year contract will be effective in 2026. Excelerate Gas Marketing Limited Partnership will supply 0.85 MTPA of LNG in 2026 and 2027. The company will then supply 1 MTPA of LNG per year from 2028 to 2040.

With the extension, Moheshkhali LNG terminal would be able to supply additional 100 mmcfd gas with its current capacity of 500 mmcfd.

At present, Excelerate Energy owns and operates Moheshkhali LNG Terminal (Floating Storage and Regasification Unit-FSRU), the first of its kind in the country that came into operation in August 2018.

Later, it built another FSRU and the second in the country for business conglomerate Summit Group, which came into operation in April 2019.

Currently, the two FSRU terminals supply about 25% of the country's natural gas supply.

As the chief guest, prime minister's Power, Energy, and Mineral Resources Affairs Adviser Tawfiq-e-Elahi Chowdhury said, "Over the last 15 years, Bangladesh has seen tremendous growth that we all, including the USA and its companies, need to support."

Speaking as the special guest, State Minister for Power, Energy, and Mineral Resources Nasrul Hamid said, "Uninterrupted and affordable energy is the key challenge in our economic growth, and the USA has come to help us."

"We have a billion dollars' investment with the USA, and more USA entrepreneurs are showing interest in Bangladesh, just due to our commitment," he added.

Among others, Zanendra Nath Sarker, chairman at Bangladesh Oil, Gas, and Mineral Corporation (Petrobangla); Md Humayun Kabir, additional secretary at the Energy and Mineral Resources Division; and Habib Bhuiyan, country manager at Excelerate Energy Bangladesh Limited, spoke at the event.

Md Nurul Alam, secretary to the Energy and Mineral Resources Division, presided over the programme.