Bangladesh has reversed its decision to skirt the expensive spot LNG market following a surge in demand for natural gas in industries and power plants, and signs of energy shortages that are forcing its importers to procure gas at record high prices.
The South Asian country's response underscored the dilemma of some of Asia's regional economies that have shifted part of their energy mix towards natural gas in recent years, but are feeling the pinch of high prices for a fuel that has never really been truly competitive.
The Energy and Mineral Resources Division (EMRD) under the Ministry of Power, Energy and Mineral Resources (MPEMR) has instructed state-run Petrobangla to take necessary action to resume spot LNG imports this month, a senior Petrobangla official said.
State-owned Rupantarita Prakritik Gas Co. Ltd. (RPGCL), a fully-owned subsidiary of Petrobangla, floated a tender to purchase one spot LNG cargo of around 138,000 cu m last week, for September delivery, and Bangladesh is considering two spot LNG cargoes for October, the official said.
This is in addition to around 5-6 term LNG cargoes imported every month.
Petrobangla had halted spot LNG imports in the first week of August following instructions from the EMRD in view of rising spot prices that were trading around $15/MMBtu at the time.