The cabinet committee on national purchases at a meeting on Wednesday approved the pricing formula paving the way for importing liquefied natural gas from Oman Trading International through the government to government purchase.
According to Power Division officials, imports of 1,000 cubic feet LNG would be charged at the rate of 11.9 per cent of Brent crude oil price in addition to $0.40 by the exporter.
The payment has to be cleared in 25 days by Petrobangla, a subsidiary of the Power Division, after submission of invoices.
As per the formula, Petrobangla will have to pay delay fines ranging from 4 per cent of LIBOR to 5 per cent of LIBOR in case of failing to clear the payment timely.
Petrobangla will also have to pay all kind of taxes for the imports while Oman Trading International will pay $3,40,000 for each LNG ship as port fees.
The approval would enable Petrobangla to import LNG for 10 years against the backdrop of growing demand for natural gas and shrinking supply of it from domestic wells.
According to the Power Division proposal, the daily gas demand reached 3,600 cubic feet against 2,750 cubic feet generation.
Industries minister Amir Hossain Amu presided over the meeting at the Cabinet Division in absence of finance minister AMA Muhith, who was abroad.
In August, the Power Division signed a memorandum of understanding with the Omani company for the imports of LNG.
Since then, both the sides were negotiating on the pricing formula that was eventually finalised in January.
Earlier, Petrobangla signed an agreement with Qatar’s RasGas for importing LNG for 15 years.
RasGas will deliver 2.5 million tonnes of LNG to Petrobangla’s floating storage and re-gasification unit near Maheskhali Island in Bangladesh.
The country is aiming to secure energy supply for industries as it pushes for an annual growth of above 7 per cent in which LNG is to play an important role.
Bangladesh currently has two terminals under development — one by Excelerate Energy and the other by Summit LNG to be located at Maheskhali Island in the Bay of Bengal.
The terminal being developed by Excelerate is set to be commissioned by this year.
Both the floating storage and re-gasification units have an annual capacity of 3.75 million tonnes of LNG.
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