Bangladesh’s LNG imports likely to triple in 3-4 yrs

Bangladesh's annual imports of liquefied natural gas (LNG) could nearly triple to at least 10 million tonnes over the next 3 to 4 years, a senior government official said on Thursday.

The additional LNG imports, needed to meet growing demand as domestic production drops, are likely to come mainly from spot and short-term contracts, Tawfiq-e-Elahi Chowdhury, energy adviser to Bangladesh's prime minister told Reuters on the sidelines of an LNG conference in the Japanese capital.

Bangladesh's state oil and gas company Petrobangla already imports about 300-400 million cubic feet per day of LNG - equivalent to 3.5 million tonnes per year in total - through two long-term contracts with Oman and Qatar.

The company also plans to buy more than 1 million tonnes of LNG on the spot market next year through its first spot tender for LNG, expected to be issued soon.

The nation of 160 million people is expected to become a major LNG importer in Asia, alongside Pakistan and India, as domestic gas supplies fall.

Bangladesh currently has two floating storage and regasification units (FSRUs) with a total regasification capacity of 1 billion cubic feet per day - equal to about 7.5 million tonnes per annum (mtpa).

It is also building a land-based terminal that can handle 7.5 million mtpa of LNG, expected to be ready in five years.

Bangladesh may consider trading in derivatives in the financial markets to manage its price risk exposure to both long- and short-term contracts, Chowdhury added.

It may also consider other pricing options for its purchase contracts apart from the traditional oil-linked LNG pricing the country had adopted for past contracts, he said earlier, speaking to delegates at the annual LNG Producer Consumer conference.