Gas supply uncertain despite Tk 15,000 crore transmission pipeline

Mahfuz Emran : Gas Transmission Company Limited (GTCL) has undertaken a total of nine projects for the establishment of gas transmission lines. Four of them are in progress. The financing of the remaining five has not yet been confirmed, the officials said. The total cost of these nine projects has been estimated at Tk 15 thousand crores. GTCL says that initiatives have been taken to implement the projects to expand the gas network in the south-western and eastern regions of the country. Out of which the funding could not be confirmed, communication is going on with various domestic and foreign organizations. Once the funding is confirmed, it will be sent to the Planning Commission for approval.
According to GTCL sources, a total of 613 km long transmission pipeline will be constructed through the projects. Tk 3,794 crores worth of work is currently underway in four projects. GTCL is trying to raise more than Tk 11,000 crore for the remaining five projects. Despite discussions with various local and foreign donor agencies, this funding has not been confirmed yet.
Currently, the daily gas demand in the country is 400 million cubic feet. Out of this, the daily supply of imported and local gas is 300 million cubic feet. There is a shortfall in gas demand and supply of 100 million cubic feet per day. In addition to carrying out exploration activities, Petrobangla has signed several LNG import contracts to reduce this shortfall. Those concerned say that still no results have been found in the search for gas to increase the supply in the near future. Again, there is great doubt about meeting the deficit through LNG imports. GTCL has taken the initiative to implement the projects with the transmission line before removing this uncertainty about gas supply. Long transmission lines have already been constructed at various locations with huge investment in anticipation of getting gas. Still not enough gas has gone through these pipelines. Meanwhile, construction of new transmission line is being talked about again. If these projects are not commercially profitable, the suffering of the energy sector will be prolonged.
GTCL, the planning and implementing agency for the projects, is itself now in losses. In the financial year 2022-23, the company incurred a system loss of Tk 500 crores by only transmitting gas. And the total financial loss of GTCL in that financial year is more than 1 thousand 213 crores due to depreciation of taka against dollar.
When asked about the organization’s projects, energy expert and BUET professor M. Tamim told, “Where the existing transmission lines do not have the capacity to supply gas, the thought of investing huge amounts of money in new pipelines is unreasonable and stubborn.” We have to think first whether our economy is gas based. There is no mention of a gas-dependent economy in our energy plan. The opposite may also happen, with foreign financing not being commercially profitable to build these pipelines. Before implementing such a project, it should be thought more properly.
One of these nine projects, the ‘Bakhrabad-Meghnaghat-Haripur Gas Transmission Pipeline’ project started in 2021. Under this, construction of 50 km pipeline of 42-inch diameter is going on from Bakhrabad in Comilla district to Haripur via Meghnaghat in Narayanganj district. This project worth Tk 1,304 crore is scheduled to be completed in June this year. Meanwhile, as this project has not been completed, three new gas-based power plants with a capacity of 1,900 MW have been installed in Meghnaghat. Bangladesh Power Development Board (BPDB) is not able to run these plants which are not getting sufficient supply of gas even though they were prepared eight months ago.
Another project under implementation ‘Bogra-Rangpur-Sayedpur Gas Transmission Pipeline’ started in 2018. The project, which was intended to supply gas to the northern part of the country, was supposed to be completed in June last year, but GTCL could not do so. The cost of construction of 150 km long pipeline and ancillary facilities was estimated at Tk 1,378 crores.
When asked about the progress of the project, project director KhandkarAriful Islam told, “The project has not been completed yet.” The period has been extended till June 2025. The cost of the project has increased to Tk 1,470 crores.
A pipeline project of 10 km diameter of 36 inches is being implemented from the east side valve station of the Bangabandhu Multipurpose Bridge to the west side valve station to provide gas facilities to power plants, industrial establishments, commercial customers built and under construction in the north and south west regions. The aim of the project is to create adequate gas supply opportunities in the north and south-west regions of the country. The project started at a cost of Tk 297 crore, but due to the increase in the value of the dollar and the increase in the cost of importing parts, the cost has now increased to Tk 445 crore. In the meantime, a proposal has been sent to the Planning Commission mentioning the increase in the cost of the project. The work on the project started in June 2021 and is expected to be completed by the middle of next year.
GTCL is implementing another project to deliver gas from the gas production companies to the intake points of the distribution companies. Under this project, the company is installing meters for gas measurement at the intake and offtake ends of various transmission lines. The work of this project of Tk 667.42 crore started in July 2021. This project is expected to be completed in June this year. This project is being implemented with GTCL’s own funding.
The total cost of these four projects under the implementation of GTCL was estimated at Tk 3,794 crores. Apart from GTCL, the 210 km pipeline project has huge funding from various donor agencies.
GTCL is currently negotiating with donor agencies for financing five more projects. The biggest project among these projects is the Payra-Barisal-Gopalganj gas transmission pipeline project. Under this, GTCL will construct the pipeline from Patuakhali deep sea port Payra to Gopalganj. The cost of construction of this 153 km line has been estimated atTk 5,952 crores. GTCL wants to implement the project by June 2026. The project was supposed to start work in 2023 but it has not started yet due to funding crisis.
US company Accelerate Energy is planning to build an LNG terminal in Paira. The construction of this terminal with a capacity of 500 million cubic feet is scheduled to be completed in 2026. However, Petrobangla has not yet signed the contract for the construction of this terminal.
Keeping this initiative in mind, GTCL wants to construct a transmission pipeline from Kuakata to Payra. The cost of construction of 30 km pipeline has been estimated at Tk 1 thousand crore. Although the project is targeted to be completed by 2026, funding has not yet been secured.
GTCL wants to construct another pipeline from Langalband in Narayanganj to Mawa for gas transmission in Jazira-Tekerhat-Gopalganj for gas supply in South-Western region of the country. The cost estimate for this project is Tk 2,360 crores.
To increase the supply of gas to the country’s national grid, the government wants to bring gas through the pipeline from the island district of Bhola. But as there is no pipeline to the mainland with Bhola, it is not possible. For this reason, Petrobangla has taken the initiative of constructing the Laharhat-Barisal gas pipeline from Bhola’s Shahbazpur gas field through Bhola North (gas field). The estimated cost of this 62 km long pipeline is Tk 1,166 crores. GTCL is yet to confirm the receipt of funds for this project, which is likely to bring Bhola gas to the national grid.
The government has taken initiatives to implement various gas-based projects to meet the demand of electricity in the south-western region. For this reason, GTCL wants to implement a project of 48 km from Khulna to Gopalganj. Through this pipeline, there is a plan to supply gas to gas-based power plants in Khulna and Gopalganj districts. The construction cost of this project has been estimated at Tk 1,079 crores.
If you want to know about these projects under the plan, Deputy General Manager of GTCL (Project Planning and Monitoring Department) Md. Mashihur Rahman said, “Financing of possible projects related to the pipeline has not been confirmed yet. The projects are still in the early stages. Because the project proposal can’t be sent to the Planning Commission without securing funding. Efforts are being made to finance these projects, only the process of approval will begin once it is confirmed.
Incidentally, GTCL transports 70-75 percent of the country’s total gas supply. The charge for gas transmission is the company’s only source of income.
Petrobangla stakeholders claim that if the company implements the project of digging 48 wells by 2025, by the end of next year, 61.8 million cubic feet of gas will be added daily to the national grid. Basically, keeping these plans in front, Petrobangla wants to bring various industrial areas and economic zones of the country under the gas grid. That is why the organization has taken the initiative to implement these pipeline construction projects.
Petrobangla Director (Operation and Mines) Engineer Md. Kamruzzaman told, “Gas transmission network is essential to supply gas to the entire country. To do this requires several stages of planning. Industrialization requires gas and electricity. To do this in the case of gas, pipelines are essential. It has to be done in stages.’
However, according to the latest data of this year, so far the availability of gas to add 12.6 million cubic feet per day has been confirmed through drilling of wells. Of this, only 4.10 crore cubic feet are added. Again, under the new contracts, it may take until mid-2026 for LNG to start arriving in the country.