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Dhaka Saturday,  Jun 3, 2023

Bangladesh Buys LNG At Lower Rate In Energy Cost Relief

The prices of liquefied natural gas have dropped in the global market months after Bangladesh decided to import spot cargoes of the commodity to alleviate a domestic gas crisis.

Buoyed by the development, Petrobangla, the state-run oil company, is increasingly confident about maintaining a normal gas supply until June.

The Cabinet Committee on Government Purchase on Thursday approved the procurement of one cargo, or 3.36 trillion Btu of LNG from Excelerate Energy, a US company.

The shipment will cost Petrobangla over Tk 5.78 billion, according to Additional Secretary Syed Mahbub Khan of the Cabinet Division.

The spot market price of LNG currently stands at $13.69 per mmBtu, down from $14.66 previously.

After an eight-month interval, the government began buying LNG from the spot market in February. Initially, the price of each unit was $20, which gradually fell.

LNG prices lurched from record lows of under $2 per mmBtu in 2020 to record highs of $56 in October 2021. At one point, the high prices prompted the government to halt purchases from the spot market.

Petrobangla Chairman Zanendra Nath Sarker said the government has approved the purchase of 12 LNG cargoes from the spot market until June. He added that in some months, Petrobangla eyes up to four cargoes in order to maintain the daily supply of 3,000 million cubic feet a day (mmcfd).

“It is a relief for us that the LNG prices have fallen in the international market recently,” Zanendra Nath said.

Meanwhile, the cabinet committee also gave the green light to the Bangladesh Agricultural Development Corporation to buy 40,000 tonnes of DAP fertiliser at Tk 2.62 billion from Morocco. Bangladesh Chemical Industries Corporation also got the nod to purchase 30,000 tonnes of urea fertiliser at Tk 1.05 billion.

Moreover, the Trading Corporation of Bangladesh has secured approval to buy 8,000 tonnes of red lentils for about Tk 0.72 billion.

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