As production will decrease soon
Mahfuz Emran : The daily gas demand in the country is about 400 million cubic feet.Against this, the supply is 266.20million cubic feet.However, with the two LNG terminals operational, the average supply is a little over 2900 million cubic feet.Officials of Petrobangla and Energy Department said that there is no sign of resolving this large shortage of demand and supply soon. According to a reliable source of Petrobangla, efforts are being made to maintain the daily supply of gas to the national grid. Petrobangla is paying
most attention to ensure that local gas production does not decrease in any way.
On the other hand, the company plans to buy double LNG (liquefied natural gas) cargo from the spot market as compared to last year. It is reported that Petrobangla plans to purchase 25 LNG cargoes this year.Besides, 56 cargoes will come under the long-term contract like last year.With this, the organization plans to keep gas supply activities uninterrupted this year.However, the planned import of cargo from the spot market is subject to price fluctuations. Petrobangla has made a projection for the current year on local gas and LNG supply activities.The first of the two-phase gas supply estimates is from February to May this year.The average supply is estimated at 279 million to 287.50million cubic feet per day.At this time, under the long-term LNG contract, 20 cargoes will arrive from two countries, Qatar and Oman, and 10 will be purchased from the spot.The second phase estimate from June to October has said 279 million to 287.50million cubic feet of gas supply.At this time, 25 cargoes are estimated to be purchased from long-term contracts and 12 cargoes from the spot market.
The projection related to Petrobangla’s gas production and LNG supply has revealed that the supply of local gas to the national grid from January to October 2022 has decreased by 184 million cubic feet during the same period last year.Petrobangla says local gas supply this year is same as last year.As the supply dwindled some additional was added from local wells.More gas can be added by renovating a couple of wells.Besides, if the price is affordable, supply activities will be maintained even by increasing LNG imports. When asked about this, Petrobangla Director (Operation and Mines) Engineer Md.Kamruzzaman told Daily Industry, “Local gas reserves are decreasing.As a result, the production from the wells will gradually decrease, which is normal.But overall gas supply is fine.The price of LNG is now low in the spot market.We plan to import a total of 25 cargoes this year.Although the matter of import is dependent on price fluctuations. Petrobangla has the capacity to supply 280-290 million cubic feet of gas per day, including local production and LNG import in the country.Out of this, local gas fields supply 210-220 million cubic feet of gas per day.The rest of the gas comes through two LNG terminals.
Beyond this, there is no clear answer as to whether any major supply of gas will be forthcoming.However, the government has indicated that by 2026, the increase in long-term LNG contracts and the completion of the construction of the LNG terminal will increase the supply of gas.Before that, it is not possible to supply more than 300 million cubic feet per day, some senior officials of Petrobangla have also admitted that. The focus is on LNG imports as a way to increase gas supply beyond local gas.
Apart from this, 46 gas wells have been dug locally.Besides, new LNG contracts have been signed with Qatar and Oman.In June last year, Petrobangla will receive 1.25 million to 1.5 million tons of LNG from Oman’s OQ Trading Limited (OQT).Under this new agreement, Oman is committed to supply gas from 2026.
Besides, under the new 15-year contract, Qatar Energy Trading LNC’s gas supply will start in 2026. As part of increasing LNG imports, the government has also signed an agreement to supply LNG to the private sector outside of the JTUG contract.
Accordingly, US company Accelerate Energy Bangladesh Limited will supply LNG for 15 years from 2026.Summit Group will supply LNG to Petrobangla for 15 years to solve gas crisis in the country.They will supply 1.5 million tons of LNG annually from October 2026.Aziz Khan, chairman of the Summit Group, confirmed to the international media Reuters that the initial agreement has been reached between the two parties.However, when asked about the matter, officials of Petrobangla refused to comment.
In view of these gas import activities, the Cabinet Committee on Economic Affairs approved a new LNG terminal of Summit Group on June 14 last year. The terminal will be constructed at Maheshkhali in Cox’s Bazar with a supply capacity of 600 million cubic feet. Apart from this, Accelerate Energy is also awaiting approval to construct an LNG terminal at Payara.
Energy experts, however, say that there is a huge amount of money involved in the process of importing LNG. At that time, the price of LNG will be determined depending on the price of fuel oil. If the price of fuel oil is high in the international market, the government will have to buy LNG at a high price. Moreover, there is uncertainty about whether the deadline for construction of the LNG terminal by 2026 can be done within that period.
In this regard, energy expert and BUET professor M. Tamim told, “LNG contract is being made to solve the gas supply crisis in the country. A specific time is called. But how to solve the problem now? Adequate supply is not coming from local gas wells. Production of gas fields is gradually decreasing. What are the steps to increase their production? Working IOC gas production in the country has been steady for several years. Why can’t we? Moreover, now the severe financial crisis of Petrobangla, how can we get the assurance that the money will be available during the new LNG contract?’
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