Bangladesh has finalised a 10-year deal to import 1 million tonnes of liquefied natural gas (LNG) annually from Oman Trading International, reports Reuters quoting two energy officials.
The deal with Oman Trading is Bangladesh’s second LNG import agreement after Qatari producer RasGas, which has since merged with sister company Qatargas, to cover the country’s domestic natural gas shortfall.
The LNG will be priced at 11.9 per cent of the three-month average price of Brent plus a $0.40 per million British thermal unit (mmBtu) constant, one of the officials said.
The deal with Oman Trading will be signed soon, the officials said.
Bangladesh is all set to receive its maiden shipment of LNG from Qatar on Tuesday, said Mohammad Quamruzzaman, managing director of the Rupantarita Prakritik Gas Co, a unit of state-owned oil firm Petrobangla.
“Within the next 24 hours, we are going to receive the cargo from RasGas,” he told Reuters on Monday, adding that the ship was carrying around 65,000 tonnes of LNG.
The pricing with RasGas is 12.65 per cent of the three-month average price of Brent oil plus a constant of $0.50 per MMBtu.
Bangladesh, a country of more than 160 million people, could import as much as 17.5 million tonnes of LNG a year by 2025, as its domestic gas reserves dwindle and demand grows.
IFC may invest $20m in LPG operator Omera Petroleum
International Finance Corporation (IFC), the private investment arm of the World Bank Group, is proposing an investment of up to $20 million to partially finance the capital expenditure of Omera Petroleum, the second-largest liquefied petroleum gas player in Bangladesh, reports Deal Street Asia, a news platform.
Omera Petroleum, which has its main import storage terminal in Mongla and three satellite storage and bottling stations in three different regions in Bangladesh, seeks to boost its operations through a $60-million capital expenditure over the next two years.
The capital spending will include acquisitions of cylinders, barges, storage tanks, trucks, and filling machinery, according to IFC’s pre-investment disclosure.
“Omera has its main import terminal in Mongla. OPL has established three other satellite filling and bottling stations at Ghorashal (Central region), Bogura (Northern region) and Chittagong (Southern region). The proposed IFC financing will support Omera’s operations through these regions,” the IFC said.
Omera Petroleum is 62.5 per cent owned by MJL Bangladesh Limited, a joint venture company between state-owned Jamuna Oil Co and EC Securities, a leading lubricant manufacturing firm in Bangladesh. BB Energy also owns 25 per cent while FMO holds 12.5 per cent.
IFC said, about 90 per cent of natural gas in Bangladesh is used to generate electricity, with demand from both domestic household and industrial segments expected to grow substantially.
However, there is a daily shortage of natural gas of approximately 1,000 million cubic feet per day, which might cause major disruptions to the economic activities if remain unaddressed, it added. “Due to the shortage of natural gas, LPG is even more needed now especially by the domestic households as natural gas is increasingly diverted for industrial and power sector use,” the IFC said.
The project, according to the IFC, will help minimize the shortage gap and address the lack of storage facilities that have become the bottleneck in the distribution chain by increasing the storage capacity at various stages in the value chain. If its planned $20-million investment is approved, the IFC said it will share its global knowledge in the fuels and fuel distribution, including LPG, industry, and advise Omera to help strengthen its business strategy and practices.