Govt to get LNG from spot market for the very first time
The government has made a decision to buy liquified gas (LNG) from the spot market for the very first time - a move that could help the country choose the super-chilled fuel at a cheaper rate, officials said yesterday.
Bangladesh would buy 34,90,200 MMBTus (million British thermal units) of LNG from Vitol Asia Pte of Singapore at $3.8321 per MMBTu, said the official of the cabinet division.
The full total cost would stand at about Tk 132.93 crore.
The cabinet committee on purchase in a meeting, presided over by Finance Minister AHM Mustafa Kamal, approved to get the LNG from the spot market.
In a spot market, financial instruments, such as for example commodities, currencies and securities, are traded for immediate delivery.
Purchasing from the location market would help save Bangladesh Tk 30 crore, said Abu Saleh Mostafa Kamal, yet another secretary of the cabinet division, while briefing reporters following the meeting.
Earlier, the finance minister said: "I believe we'd get competitive prices. This would open up a fresh chance for Bangladesh."
Bangladesh now buys LNG on its own from RasGas of Qatar under a government-to-government purchase agreement. In 2017, Bangladesh signed a 15-year contract with RasGas, which would supply 2.5 million tonnes of LNG each year.
The fuel comes at 12.65 % of the three-month average price of Brent oil plus $0.5 frequent per MMBTu.
The united states also imported its first LNG cargo from Oman Trading International in January last year under a 10-year deal. The LNG will set you back 11.9 per cent of the three-month average price of Brent crude oil plus a constant price of 40 cents per MMBTu, Reuters reported.
Bangladesh added LNG to its energy system in 2018 within the government's efforts to remove gas shortages and power outages and unlock the potential of the economy.
Excelerate Energy of the united states started out supplying re-gasified LNG from its terminal in Moheshkhali in August 2017. It includes a regasification capacity of 500 million cubic feet each day.
In May last year, Summit LNG Terminal Co Ltd, the country's second LNG terminal, started out supplying re-gasified LNG. The unit includes a capacity of supplying 500 million cubic feet of re-gasified LNG.
The cabinet committee on purchase yesterday approved a complete of 10 procurement proposals involving Tk 1,795 crore. Of the sum, Tk 630 crore would result from the government and Tk 1,164 crore will be raised from the neighborhood banking sector.
The meeting permitted Bangladesh Agriculture Development Corporation to buy 1.5 lakh tonnes triple super phosphate fertilizer for Tk 400.26 crore from Moroccan fertilizer producer OCP.
The state agency also got approval to get 2.1 lakh tonnes diammonium phosphate from the same company at a price of Tk 695.68 crore.
The meeting gave its consent to a proposal of Bangladesh Chemical Industries Corporation to get 30,000 tonnes granular urea fertilizer for Tk 68.52 crore from Karnaphuli Fertilizer Company Ltd.
The meeting also awarded the work to build a 20-storied residential building in the authorities Lines in Razarbagh, Dhaka to the cheapest bidder, Padma Associates & Engineers.
The construction of the building would cost Tk 82.63 crore and is likely to lessen the housing problem faced by the authorities.
A joint venture of BBL and DECL won a bid order to create a 20-storied residential building for the next Police Lines in the Chattogram Metropolitan Police. It could cost Tk 81.45 crore.
The meeting gave a nod to a proposal to get 119,212 spun pre-stressed concrete poles from Castle Construction Co Ltd and Contech Construction Ltd for Tk 159.89 crore.
The project, which aims to expand the distribution network of Bangladesh Rural Electrification Board, would be implemented in Rajshahi, Rangpur, Khulna and Barishal.
