Controversy over floating LNG terminal, no immediate solution

• Two FSRUs, gas crisis starts when one shuts down
• The ongoing crisis may end in the middle of this month
• Consultancy experts for construction of land based LNG terminal
• Land terminal work pending for Ministry of Shipping and Port Authority

As a result of global warming and climate change, Bangladesh is at high risk among the disaster-prone countries of the world. Disasters like cyclones and floods are regular occurrences here. At stake are two floating storage and regasification units (FSRUs) at sea.

LNG cargoes are loaded and unloaded from tankers at sea through this station designated for the import or export of liquefied natural gas (LNG). When any one of them is useless, the whole country suffers greatly.

Some of these terminals are floating and some are on land in different countries of the world. However, both the LNG terminals in Bangladesh are floating. Basically this LNG terminal is a specialized ship near the coast. This FSRU is moved to the deep sea for safekeeping after severe weather is forecast.

Information from the Energy Department says that one of the two FSRUs in Cox’s Bazar’s Maheshkhali belongs to Summit Group, the other to Singapore-based US company Accelerate Energy. The energy department has a 10-year contract with the two companies since 2018. Each of them has a capacity of 1 lakh 38 thousand cubic meters. Both terminals have a capacity of 1,100 million cubic feet per day for LNG regasification.

The two terminals together supply an average of 800 to 1000 million cubic feet of gas per day when operational. Even though the country’s domestic gas supply and terminals are fully functional, there is a shortage of gas in the national grid. If any one of these terminals is closed, the people of the country suffer from severe gas shortage. From home cooking disruptions to factory production disruptions.

One or the other of the two FSRUs in Bangladesh is often shut down due to natural calamities, technical faults or other reasons. The Summit Group’s FSRU was damaged in the latest Cyclone Rimal. It has been taken to Singapore for maintenance. The gas crisis has become more acute. Besides, as per the terminal construction contract, there is an obligation to look after and maintain the technical defects of the terminal every five years. Earlier in October last year, Accelerate Energy’s terminal went under maintenance. At that time there was severe gas crisis across the country.

Experts say Bangladesh must build a land-based LNG terminal for a long-term solution. FSRU is a temporary solution. It can never be long lasting and sustainable.

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According to Petrobangla, only 600 million cubic feet of gas is being supplied per day through Accelerate Energy’s terminal due to the closure of Summit’s LNG terminal. Another 2,000 million cubic feet of gas is available daily from domestic sources in the country. But there is a daily demand of 3100 million cubic feet of gas. There is a shortage of about 500 to 600 million cubic feet of gas every day.

Controversy over floating LNG terminal, no immediate solution

They also said that on July 6 or 7, the FSRU will start its journey from Singapore to Bangladesh for the summit. It will reach the country on July 12. It will take another three days to start the process after reaching the country. As a result, it will start gas supply between July 15 and 17. The problem will continue till then.

Bangladesh University of Engineering (BUET) former professor, energy and sustainable development expert Dr. Ijaz Hossain told Jago News that our situation is day by day. We were not supposed to do FSRU. When it appears that there is no time on hand, FSRU does. It should be land based. Now we have two FSRUs and are dependent on them. This is not the case. Our time was not a problem. We have been doing these since 2015, almost ten years.

This energy expert said, there was a gap, steps have been taken to fill it. That’s how it goes. But there is no initiative to correct it. There was a need to replace two FSRUs with one land-based one.

Urging to emphasize on domestic gas exploration of the country, this energy expert also said that the money required for own gas exploration is not allocated in this budget. Now many things are being said to make people understand. We need to look at much more gas exploration. Then two things will happen. We will get some gas. As much gas as we get, the cost will go up. There will be a chance to get extra gas. If not, then we realize we have no more gas, manage differently. But the government is not taking it seriously.

When asked about this, Petrobangla Chairman Janendra Nath Sarkar told Jago News that we had a land-based plan since 2017. It will be at Matarbari. However, the Ministry of Shipping has not yet created that channel. They plan to build the channel in 2030 or 2031. We have said that this channel should be made by 2027 or 2028. If Ministry of Shipping and Chittagong Port Authority can build the channel by 2029 then we can contract.

Chairman of Petrobangla also said that there is a plan for this terminal in Payara. Payra Port Authority says they will build draft above 15 meters by 2029. We have also started working with pigeons. Payra and Matarbari, whichever is earlier (in that) we are working all the time to build the land-based terminal. But this is not just our decision alone. We will work according to when the Ministry of Shipping and Port Authority will make the drive.

He said, we are working as a team. If I get a draft of more than 15 meters by 2029, I will move here. And an agreement has been signed with Summit for a third floating terminal at Maheshkhali. It will arrive in mid or late 2026.