Cabinet committee declines Tk13,000cr LNG terminal proposal

The Power, Energy and Mineral Resources Division placed the proposal at a purchase committee meeting yesterday (13 October), but it was not approved and was subsequently withdrawn, according to a ...

Bangladesh imports about 95% of its energy and faces rising pressure on the budget, the balance of payments and inflation.

Photo: REUTERS The Cabinet Committee on Government Purchase has declined to approve a proposal to set up a floating storage and regasification unit (FSRU) at Kutubjom in Maheshkhali, Cox's Bazar, under a government-to-government (G2G) arrangement.

The Energy Division subsequently withdrew the proposal.

The project, proposed to be implemented by China National Energy Engineering and Construction Company Limited (CNEE), was estimated to cost Tk12,324 crore over 15 years and Tk13,161 crore over 20 years, according to official documents.

The Power, Energy and Mineral Resources Division placed the proposal at a purchase committee meeting yesterday (13 October), but it was not approved and was subsequently withdrawn, according to a Cabinet Division press release.

The government had planned to complete the terminal by 2028, adding around 600 million cubic feet per day (MMCFD) of regasified liquefied natural gas (LNG) to the national grid.

The project was initiated to address the country's persistent gas shortage amid declining domestic production and technical problems at existing LNG terminals.

On 28 July, the Cabinet Committee on Economic Affairs (CCEA) gave in-principle approval to establish the Kutubjom FSRU under the G2G framework.

The proposed terminal was expected to expand the country's LNG import and regasification capacity to meet growing demand for natural gas.

The Energy and Mineral Resources Division has yet to issue an official explanation of whether the proposal will be reassessed and resubmitted or a fresh tender will be invited.

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