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Dhaka Thursday,  Mar 28, 2024

Proposal to fix Gas Price for 22 years: Purchase Committee Denies

Mahfuj Risad

Power division in a proposal asked for a high but fixed price of gas for a power plant for a long time. However, the cabinet purchase committee has rejected the proposal.

The cabinet committee rejected the current proposal in a meeting held on Wednesday yet, asked for a correction in the proposal. The proposal was made for the proposed gas-fired 450 MW Meghnaghat power plant to fix the gas price for it for the next 22 years. The fixed price of gas won’t change in the next 22 years regardless of the market price of gas in international market in the next 22 years, claimed the proposal.

The purchase committee didn’t agree with that proposal saying it was not just. However, the committee said that it might accept the proposal if it was corrected.

The committee said the price of gas might be fixed for a tenure of 5 years but not for 22 long years. The price of gas might get changed by a margin in the times to come, therefore the price should be adjusted after a regular interval.

Finance minister A H M Mustafa Kamal said that a ‘conditional’ policy level approval was given to set up the 450 MW power plant in Meghnaghat. A consortium of Anlima Textile and GE Capital Global Energy Investment JV has got the policy level approval, not the final approval for setting up the 450MW LNG combined cycle power plant in Meghnaghat under some conditions, he added.

The committee has no objection about the project, but the committee is not agreed with the proposal of fixing the price of gas for 22 years, said the finance minister.

After being asked by the journalist about ‘what if the Joint Venture (JV) company won’t fulfil the conditions set by the government’ the finance minister replied that the proposal won’t get approved then. This is going to be an LNG based power plant and the price of LNG in the international market will have to be considered in this case, therefore, the committee asked them to lessen the time to 5 years.

During the meeting, the committee has also approved BDT 207 crore 60 lacs for purchasing spare parts and hiring expert consultancy for the operation and maintenance of unit-1 and 2 of the 225 MW combined cycle power plant of Bhola which is owned by Power Development Board (PDB). General Electric will be carrying out all these activities.

The committee also approved BDT 66 crore 80 lacs for purchasing equipment that will be needed to give access to electricity to a number of 15 lac subscribers by Rural Electrification Board (REB).

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