Bangladesh will purchase three LNG cargoes from spot market for April delivery as the prices are in downtrend with mounting demand for natural gas and rise of mercury in the ensuing summer.
Previously state-run Petrobangla purchased maximum two LNG cargoes from spot market.
Petrobangla's subsidiary state-owned Rupantarita Prakritik Gas Company Ltd (RPGCL) already floated tenders for all the three cargoes and received lower price quotes for the first two cargoes, said a senior Petrobangla official.
Vitol Asia, Petronas and AOT Trading submitted bids for the two LNG cargoes for April delivery.
Two suppliers submitted bids for the LNG delivery in first week of April, while three bidders quoted prices for the second week of April deliveries.
Tender for the LNG delivery in third week of April was not yet opened, said the official.
The lowest bid for both the tenders was around US$8 per mmBtu (million British thermal unit) to supply each cargo having the quantity of 138,000 cubic metres of LNG from spot market.
An evaluation committee will review the offers to select the best bidders.
Singapore-based Vitol Asia Pte Ltd won the previous two bids to supply LNG from spot market for March deliveries after two months of hiccup.
State-run Petrobangla will purchase the LNG cargoes at US$9.3123 per mmBtu for the delivery during the first week in March and at $9.36 per mmBtu for the delivery during second week in March.
The country's cabinet committee on government purchase approved awarding the spot LNG purchase tenders in favor of Vitol a couple of weeks back.
The RPGCL has been floating tenders since August 2020 to purchase LNG from the spot market under a government plan to meet around one-fourth of the country's total LNG requirements from spot market.
In the past tenders the RPGCL could bag only tender in September 2020 within the price of its expectation.
The 14 suppliers allowed to bid for Bangladesh's spot tenders are: Mitsui, Marubeni, Osaka Gas, Jera, Cheniere Marketing International, Vitol Asia, Trafigura, Diamond Gas International, Excelerate Energy, Woodside Petroleum, Eni, AOT Trading, Petronas, and the joint venture of Summit Corp and Summit Oil & Shipping of Bangladesh.
Bangladesh initiated to import LNG, or liquefied natural gas, from spot market after two years of the country's first LNG cargo imports in August 2018.
Currently, the country's LNG import price under long-term contracts with Qatargas and Oman Trading International, ranges around $8.00 per mmBtu, said the Petrobangla official.
Bangladesh has a 15-year contract with Qatargas to import around 2.5 million mt/year of LNG, at a 12.65 per cent slope of the three-month average Brent price plus a 50-cent constant. Its contract with OTI is for 10 years at an 11.9 per cent Brent slope plus 40 cents.
It has two operational floating, storage regasification units with a capacity of around 500 million cubic feet per day (mmcfd) equivalent in LNG.
Excelerate Energy started supplying its FSRU in August 2018, while Summit started supplies in April 2019.