US firm Excelerate suspends regasification for overhauling

Gas supply across Bangladesh is to fall as US multinational Excelerate Energy ceased LNG re-gasification at its plant for its overhauling and capacity expansion, sources said.

Excellence, Bangladesh's first floating storage and re-gasification unit (FSRU) owned by Excelerate Energy, closed operations Wednesday to go for the long-overdue renovation work.

The FSRU has already been untied from Moheshkhali mooring in the Bay of Bengal to start its voyage to Singapore for the overhaul, a senior official of state-run Petrobangla told the FE Thursday.

"It's the FSRU's first overhauling since the beginning of commercial operation on August 19 in 2018," he said.

Excellence had re-gasified imported liquefied natural gas or LNG continuously in Bangladesh except for a brief period. It was intentionally taken offline along with the country's remaining operational FSRU, owned by Summit Group, on May 12 as a precautionary measure to avoid any damage from Cyclone Mocha. It came online on May 20 after an eight- day hiatus.

Both the FSRUs are located on Moheshkhali Island in the Bay of Bengal.

Excelerate Energy will take around a couple of months to complete the overhauling of its FSRU having a capacity of 3.75 million tonnes per annum (MTPA) and enhance its re-gasification capacity by 20 per cent to 4.5 MTPA or 600 million cubic feet per day (mmcfd).

After the renovation and capacity expansion, Bangladesh's overall LNG re-gasification capacity is set to increase to 1,100mmcfd from the current level of 1,000mmcfd.

The government is expected to squeeze import of LNG from spot market during the overhauling period of the FSRU commensurate with the curtailed re-gasification capacity that may continue until early December, said sources.

Bangladesh will, however, continue importing the liquid gas from the long-term suppliers, the official said.

The country is expected to import a total of eight LNG cargoes from its two existing suppliers in the gulf region- Qatargas and OQ Trading - four each in the months of November and December. In November, Qatargas will deliver three cargoes, while OQ Trading will supply one, according to the annual delivery programme 2023.

Qatargas will supply all four LNG cargoes during December when OQ Trading will supply none, the RPGCL official added.

"Petrobangla will have to rely on Summit's FSRU alone in absence of Excellence and the country's overall LNG re-gasification capacity would come down to only 500,000Mcfd," he said.

Like on previous occasions, Bangladesh is set to witness energy shortages coupled with frequent power outages during Excellence's overhauling, consumers fear.

Previously Petrobangla had to ration gas supplies to industries and power plants and the country had to rely more on oil-fired power plants to cope with the gas crisis resulting from squeezed or non-operation of the FSRUs on few occasions.

To avoid similar energy crunch ahead of the general election slated for January 2024, Excelerate Energy on request by the government had deferred the scheduled overhauling four times since April and was successful in avoiding the summer schedule by shifting it to November when temperatures fall.

Before ceasing LNG re-gasification, Bangladesh gradually squeezed overall LNG re-gasification to around 601mmcfd from two operational FSRUs last week from its peak of around 950mmcfd last month, when overall natural gas output was around 2,950mmcfd, according to official data.

After Excellence's operation put on hold, Bangladesh's LNG re-gasification came down to around 492mmcfd and overall natural gas output at 2,590mmcfd, according to official data as on November 1, 2023.

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