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Bangladesh is going to ink three agreements with US multinational Excelerate Energy's Bangladesh outfit today on import of increased volumes of liquefied natural gas and LNG regasification and transmission.
The deals with Excelerate Energy Bangladesh Ltd include sales and purchase agreement (SPA) on import of up to 1.0 million tonnes per year (MTPA) of LNG, expansion of Moheshkhali Floating LNG terminal and term-sheet agreement on building a floating storage and regasification unit (FSRU) near Payra seaport, said a senior Petrobangla official.
The cabinet committee on government purchase last week approved inking the long-term SPA with Excelerate Energy and MLNG-expansion deals.
Under the deals Bangladesh will import LNG from Excelerate Energy for 15 years from 2026 onward.
It will be the country's fifth long-term LNG-import contract and third since June 2023.
Excelerate Energy will supply 0.85 MTPA of LNG from January 2026 to December 2027 and 1.0 MTPA of LNG from January 2028 to December 2040, said sources.
"That means Petrobangla will buy a total of 12 LNG cargoes each during 2026 and 2027 and 16 LNG cargoes from 2028 until 2040," said the Petrobangla official.
Bangladesh will purchase LNG from Excelerate Energy at around 13.35 per cent of the three-month average Brent crude oil prices plus US$ 0.30 cents per million British thermal unit (MMBTu), which stands out to be the highest-ever rate among the deals already inked, said sources.
A couple of years back, before Russia's invasion in Ukraine in February 2022, Excelerate Energy had offered to supply LNG following JKM index until 2023, they said.
And from 2023 and onwards it had quoted to supply LNG at around 11.70 per cent of the three-month average prices of Brent crude oil plus US$ 0.35 per MMBTu constant.
But the then negotiations between Petrobangla and Excelerate faltered without any headway.
Previously on June 1, 2023 Bangladesh signed a long-term LNG sales and purchase agreement with QatarEnergy for 15 years starting in January 2026 to supply up to 1.8 million MTPA of LNG.
On June 19, Bangladesh inked an SPA with OQ Trading, formerly known as Oman Trading International, to import up to 1.5 MTPA of LNG for 10 years starting in 2026.
The purchase prices of LNG with the QaterEnergy OQ Trading are around 13 per cent of the three-month average Brent crude oil prices, said sources.
According to OQ Trading, the OQ will supply four LNG cargoes or 250,000 mt in 2026, 16 LNG cargoes per year or 1.0 MTPA in 2027 and 2028 and 24 cargoes per year or 1.5 MTPA from 2029 to 2035,
Bangladesh started importing LNG in August 2018 after inking its first-ever SPA with Qatar's RasGas, later renamed Qatargas and finally QatarEnergy, on September 25 2017 to buy up to 2.5 MTPA of lean LNG over 15 years.
The purchase price is 12.65 per cent of the three-month average price of Brent crude oil plus US$ 0.50 constant per MMBtu.
The country inked its second long-term LNG-import deal with OQ Trading on May 6, 2018 to import up to 1.5 MTPA of LNG from OQ for 10 years until 2029.
Petrobangla has the option of increasing LNG imports to 1.5 MTPA or lowering it to 900,000 tonnes per year.
Bangladesh has been purchasing LNG at around 11.9 per cent of the three-month average of Brent crude oil prices plus $ 0.40 cents per MMBTu from OQ trading.
Under the Expansion of MLNG deal, Excelerate Energy will increase LNG regasification capacity of its FSRU on Moheshkhali island on the Bay of Bengal by 20 per cent to 600 million cubic feet per day (mmcfd).
Excelerate Energy's FSRU - Excelllence - went for overhauling on November 1.
Under the term-sheet agreement to build an FSRU near Payra seaport the US firm is expected to bag contract to build the new FSRU in southern Bangladesh.
It will also have to lay around a 200km regasified LNG (RLNG)-carrying pipeline from Kuakata to Khulna to feed gas-guzzling industries, power plants and other consumers in the country's southwestern region.
Sources said Excelerate Energy is the owner of both the operational FSRUs in Bangladesh having the total regasification capacity of around 1,000mmcfd.
Apart from owning its own FSRU named MLNG terminal, Excelerate Energy provided FSRU to Summit Group's Summit LNG Terminal Company Ltd under a 15-year charter agreement.