Govt to buy 18 LNG cargoes from France's TotalEnergies over nine months

The government will import 18 cargoes of liquefied natural gas (LNG) from France-based energy company TotalEnergies over the next nine months, with two cargoes scheduled each month from October this year to June next year.

The government may also purchase additional LNG cargoes from the company if needed, subject to mutual agreement between the two sides.

The Cabinet Committee on Government Purchase approved the LNG procurement proposal at a meeting chaired by Finance Minister Amir Khosru Mahmud Chowdhury today (9 September).

The LNG will be procured through the direct purchase method for international procurement.

Each LNG cargo from TotalEnergies will be priced at the Japan Korea Marker (JKM) plus $0.06 per million British thermal units (MMBtu), according to the government.

The rate is slightly lower than the price agreed with US-based Gunvor for 14 LNG cargoes to be imported between 2026 and 2028. Under that arrangement, the price was set at JKM plus $0.0875 per MMBtu.

The TotalEnergies procurement received policy approval from the Cabinet Committee on Economic Affairs to meet urgent gas demand amid heightened geopolitical instability stemming from the conflict in the Middle East, according to the Ministry of Finance's Public Relations Department.

Bangladesh has long-term LNG supply agreements with Qatar and Oman. However, supplies under the contracts have been disrupted amid the Iran conflict, contributing to the country's ongoing gas shortage.

Against this backdrop, the government has been buying LNG from the spot market at relatively high prices while seeking alternative sources to bolster supplies.

As part of that effort, the government has also approved a proposal to sign a long-term LNG import agreement with US-based Gunvor through 2038.

Under the approved arrangement, Bangladesh will import 14 LNG cargoes from Gunvor between 2026 and 2028 at JKM plus $0.0875 per MMBtu.