The Ministry of Power, Energy and Mineral Resources has taken the initiative to import a cargo of LNG from the spot market to meet the country’s energy needs.
A total of 33 lakh 60 thousand MMBTU of LNG will be imported in one cargo. The total cost to import 1 cargo of LNG through international quotation will be 657 crore 13 lakh 93 thousand 920 taka. Singapore-based Ganvor Singapore Private Limited will supply this LNG.
According to related sources, two floating LNG terminals with a capacity of 500 mmcf per day and 600 mmcf per day have been set up at Maheshkhali in Cox’s Bazar to meet the existing and increasing gas demand of the country. Currently 2.5 MTPA of LNG from Ras Laffan Liquefied Gas Company Limited (Katargas) over a 15-year period and from Oman Trading International (now OQT) over a 10-year period under agreements signed with Petrobangla on a G2G basis through two terminals. MTCA of LNG i.e. total 3.5 MTPA of LNG is being imported. Besides, LNG is being procured from the spot market besides importing LNG on a long-term basis for uninterrupted gas supply to power, industry and fertilizer plants in the country.
The process of purchasing LNG from the spot market was done under the ‘Promptly Increasing Supply of Electricity and Energy (Special Provisions) Act, 2010’. Following the due process under this Act, Petrobangla signed the MSPA with 23 MSPA signatories after preparing the Master Sale and Purchase Agreement (MSPA) after obtaining vetting by the Legislative and Parliamentary Affairs Department and in principle approval of the Cabinet Committee on Economic Affairs. Since 2020, the process of purchasing LNG from the spot market using the LNG Spot Purchase (LSP) software developed by Petrobangla and the list of MSPA signatories has been ongoing.
On August 18, 2024, the Ministry of Power, Energy and Mineral Resources instructed that all negotiations, project selection processing and procurement processing activities under the ‘Rapid Supply of Electricity and Energy (Special Provisions) Act, 2010 will be closed for the time being. In this context, in view of the proposal of the Department of Energy and Mineral Resources, the Advisory Council Committee on Economic Affairs, in its meeting held on September 4, unanimously recommended that the proposal to import LNG from the spot market can be approved in principle on the condition that it does not conflict with any provisions of PPA-2006 and PPITRA 2008. is
According to the relevant sources, the advisor of the Ministry of Power, Energy and Mineral Resources has given principle approval for the purchase of 16 cargoes of LNG from the spot market for the period of September to December 2024 for the uninterrupted supply of gas to power, captive power, industrial, fertilizer and commercial sectors. The plan was to purchase 5 cargoes of LNG from the spot market in October. As a result quotations are called for in international purchases on an overall basis. However, as the required number of firms did not submit quotations, the procuring authority rejected the quotations. Later, the proposal for the purchase of 1 cargo LNG supply for the period of October 10-11 has been sent for presentation to the Advisory Council Committee on Public Procurement by inviting re-quotation. In general, 23 companies that signed the MSPA on September 22 for supply of 1 cargo of LNG on October 17-18, 2024 have been sent e-mails for submission of courtations through LSP software.
According to sources, a total of 3 firms participated in the quotation for the 28th cargo. Among them, Singapore-based Gunvar Singapore Pvt Ltd is the lowest bidder, quoting the price of LNG at $13.9300 per unit. Among the other 2 institutions, Accelerate Energy LP, USA was at $14.1500 and PetroChina International (Singapore) Pvt Ltd was at $14.8500. As the lowest bidder at $13.9300 per unit of LNG, the total cost of import of one cargo of LNG including VAT will be Tk 657 crore 13 lakh 93 thousand 920.
Finance and trade advisor for approval of 2 separate proposals. It is said that it will be presented in the next meeting of the Advisory Committee on Government Procurement held under the chairmanship of Salehuddin Ahmed.
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