The country's second liquefied natural gas (LNG) terminal, owned by Summit Group, is scheduled to initiate its commercial operation next month, mounting further the fiscal burden on the state-run Petrobangla over import of the fuel.
After commissioning, Petrobangla would have to pay around $217,000 (Tk 18.22 million) per day to Summit no matter whether the state entity re-gasifies LNG from the floating storage re-gasification unit (FSRU) or not, as per the 'take or pay' deal, said a senior official.
This is the 'capacity payment' for the FSRU, which has to be paid by Petrobangla to Summit, under the deal.
On top of the payment, Petrobangla would have to pay the price for importing LNG from global suppliers for re-gasification in the terminal, he said.
Petrobangla would re-gasify up to 500 million cubic feet per day (mmcfd) equivalent LNG through the Summit's FSRU, as per the agreement to use the terminal.
Summit's LNG terminal - similar to the currently operational maiden FSRU owned by the US-based Excelerate Energy - would be located at Moheshkhali Island in the Bay of Bengal.
The FSRU would have the capacity to re-gasify around 3.75 million tonne per annum (mtpa) of LNG like that of Excelerate's LNG vessel - Excellence.
Summit has informed its readiness to both Petrobangla and the Rupantarita Prakritik Gas Company Limited (RPGCL) to initiate commercial operation of the FSRU from April 20, a senior official said.
Currently, Petrobangla has been paying Excelerate around $237,000 per day, as its Excellence is currently re-gasifying around 534 million cubic feet per day (mmcfd). It is 6.80 per cent higher than the agreed quantity for re-gasification of LNG, according to Petrobangla statistics as of March 24, 2019.
Both the FSRUs are designed to re-gasify up to 500 mmcfd of LNG.
Currently Petrobangla has been counting loss worth around Tk 10 billion per month, which might soar to over Tk 20 billion with the commissioning of the Summit's LNG terminal, if gas tariff is not hiked, a Petrobangla official said.
Petrobangla and its subsidiary gas marketing and distribution companies, however, have sought to hike the average gas tariff to the Bangladesh Energy Regulatory Commission (BERC) by around 103 per cent for consumers to offset the loss.
The proposals are now pending with the commission, following a four-day public hearing, organised by BERC this month.
Consumer rights groups, businesspeople, and various political parties have protested the tariff hike proposals.
The country's maiden FSRU began its commercial operation on August 18, 2018 after importing first LNG - with Excelerate's commissioning cargo on April 24, 2018.
Excellence got connected to the subsea pipeline network on August 05, and commenced injecting the first re-gasified LNG to pipeline network on August 12.
Technical issues and rough sea during the June-August south-western monsoon kept it stranded off the south coast of Chattogram for months.
Bangladesh is currently importing lean LNG from RasGas of Qatar and Oman Trading International of Oman under term deals.
The country's overall natural gas output is currently hovering over 3,200 mmcfd with the re-gasified LNG to the tune of around 500 mmcfd from the Excelerate's FSRU.
With the commissioning of the Summit's FSRU, the total natural gas output is expected to increase to around 3,700 mmcfd.
