Excelerate FSRU needs another shutdown to restore full capacity, says Minister Amit

The floating LNG terminal, or FSRU, operated by Excelerate Energy will have to be temporarily shut down again to restore it to full capacity, State Minister for Power, Energy and Mineral Resources Aninda Islam Amit says.

He said discussions were under way with Excelerate Energy to determine when the terminal could be shut down with the least possible impact on industries, power generation and other consumers.

The state minister made the remarks on Tuesday at a seminar titled “Energy Sector Crisis: Prospects and Ways Forward”, organised by the Forum for Energy Reporters Bangladesh (FERB) at Dhaka Club.

Power, Energy and Mineral Resources Minister Iqbal Hassan Mahmood Tuku was the chief guest at the event.

Amit said the country’s gas supply had been disrupted because of problems at the FSRU operated by Excelerate Energy.

“With the assistance of local and foreign experts, operations at the terminal have been partially restored,” he said.

One part of the terminal is now operational, but another part has yet to become fully functional.

The state minister said the section currently in operation would also have to be temporarily shut down to bring the second section back into service.

He said the government was now trying to determine a time when shutting down the FSRU would cause the least inconvenience to people.

“The government’s goal is to restore the terminal to full capacity,” he said.

Tuku also referred to the FSRU problem, saying that an issue at one LNG terminal had put significant pressure on gas supplies across the country.

In his view, alternative infrastructure should have been in place beforehand to deal with such situations.

Criticising the previous government, he said investments had been made in areas where there were opportunities to spend money in the name of development, but insufficient attention had been paid to where infrastructure should be built to ensure sustainable development in the long term.

He cited the nationwide impact of a problem at a single terminal as an example of that weakness.

Amit also said a foreign private-sector group had shown interest in establishing a new, large-scale LNG terminal in Bangladesh.

He did not disclose the name of the company.

Representatives of the group have held meetings with the government and expressed interest in developing a large-scale LNG terminal, he said.

The government has asked them to submit a formal proposal. Once received, it will be examined, Amit said.

The need to expand infrastructure for LNG import and supply in view of the current gas crisis also featured prominently in the seminar discussions.

Asked by a journalist about a new FSRU project, Amit said no project from any particular company had been directly approved.

The government took a policy decision to implement the project through a government-to-government, or G2G, arrangement, he said.

Under this system, the government works directly with the government of another country or a government-backed organisation.

Amit said the eligible entities among those that had initially expressed interest were evaluated under the G2G framework. The process was subsequently advanced based on a shortlist.

He said the G2G approach was chosen because the project needed to be implemented quickly.

Requests for proposals, or RFPs, had been sought from the relevant parties, he said.

Once they receive the proposals, the government team will negotiate. Then it would be moved to the contract stage only if the discussions are satisfactory, Amit said.

‘Production Increase is the Only Solution’

There will be no long-term solution to the current energy crisis without increasing domestic gas production, Amit said.

“If we cannot increase production in the country, no amount of discussion will bring a permanent solution,” he said.

The government has floated a new tender for oil and gas exploration in the sea.

The deadline for the tender is November, Amit said.

The government expects international oil and gas companies to show interest in Bangladesh’s offshore blocks this time, he said.

Bangladesh has experience with successful offshore bidding rounds in the past, he added.

The government is also preparing to launch new tenders for oil and gas exploration onshore.

Amit said work was under way on an onshore bidding round as well and that the process would be taken forward as quickly as possible.

Tuku Plans Houston Trip to Invite Companies

Power Minister Tuku also spoke of plans to directly promote Bangladesh’s offshore bidding round to major international companies.

He said he had discussed the matter with the US ambassador and wanted to travel to Houston in this regard.

“There, I want to meet senior officials of major oil and gas companies and invite them to participate in Bangladesh’s offshore bidding round,” he said.

He believes Bangladesh needs to directly present its potential to international companies.