LNG structure in Bangladesh, 3 other countries in trouble: study

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LNG structure in Bangladesh, 3 other countries in trouble: study​

Gas crisis to persist through 2026​

Staff Correspondent | Published: 00:14, Aug 16,2022

LNG structure in Bangladesh, 3 other countries in trouble: study

With the global LNG market staying turbulent accompanied by high price amid inadequate supply, LNG infrastructure projects worth $96.7 billion in four south and south-east...

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With the global LNG market staying turbulent accompanied by high price amid inadequate supply, LNG infrastructure projects worth $96.7 billion in four south and south-east Asian countries, including Bangladesh, risk getting faltered or cancelled, said a report released by the US-based Institute for Energy Economics and Financial Analysis.

The three other counties include Pakistan, Vietnam and the Philippines.

Country-wise breakup of investment in LNG infrastructure was not mentioned in the report released online.

In the first seven months of 2022, LNG imports in Asia fell by more than 6 per cent year-on-year.

Liquefied Natural Gas deliveries to Pakistan and Bangladesh in the first seven months of this year fell by 8 per cent and 4 per cent year-on-year, respectively, according to the report.

The report also cited Bangladesh and Pakistan as recently stopping LNG import from spot market.

Citing Bloomberg New Energy Finance, the report estimated a potential fall of 29 million tons of LNG demand in Asian market through 2025.

It said that the BNEF expected that moderate to severe gas shortages could occur in Pakistan, Bangladesh and Thailand through 2026.

In Bangladesh, gas supply to power plants has fallen to 900 million cubic feet from 1,600mmcf causing 40 to 50 per cent of gas capacity to stay offline and stranded due to limitations on gas supply, mentioned the report.

The first significant supply increase in the LNG market is due in 2026 when Qatar is expected to add 32 million tons per annum of additional capacity.

Significant new global LNG supply capacity is not expected online until 2026, the report said, adding that the LNG market could remain tight for the next several years.

‘Financiers and investors in new LNG projects must take note,’ Sam Reynolds, the author of the IEEFA report, was quoted as saying in a press release.

According to the report LNG imports have fallen in China 20 per cent and India 10 per cent year-on-year.

In June, a working paper of the Centre for Policy Dialogue in Bangladesh, 6,468MW of LNG-based power capacity was under construction in Bangladesh.

The power plants are likely to come into operation by June 2025.

Roughly $1.3 million needs to be invested in developing 1MW capacity.

Bangladesh is currently relying on long-term contracts for LNG import from Qatargas and Oman Trading International at about $14 per mmbtu.