Anisul Islam Noor :
The Excelerate Energy Ltd of the US has sought tax exemption from its income against installation of floating, storage and re-gasification unit (FSRU) to facilitate LNG imports, Petrobangla sources said.
It also sought exemption from import duty for the FSRU and infrastructure components and permission for its re-export, they said.
The Energy and Mineral Resources Division under the Ministry of Power, Energy and Mineral Resources (MPEMR) has sought opinion from the Ministry of Finance and the National Board of Revenue (NBR) to settle the issue, a senior MPEMR official said.
The Excelerate earlier also sought to select a US insurance firm for the LNG terminal project, while state-run Petrobangla wants the project to be insured with Bangladesh’s state-run general insurance company-Sadharan Bima Corporation.
The issue of selecting an insurance firm is yet to be settled, said officials.
The US firm is, however, in final round of negotiation with Petrobangla to ink the final deal to build the country’s first LNG (Liquefied Natural Gas) Terminal at Moheshkhali Island in the Bay of Bengal.
The consortium of Astra Oil (also of the US) and Excelerate Energy was one of the three short-listed firms in Petrobangla’s tendering process in June 2012 to build Bangladesh’s first LNG import terminal.
The Excelerate later came out independently to build the terminal and started negotiation as the government decided to implement the LNG terminal project under the Speedy Supply of Power and Energy (Special Provision) Act, 2010 to relax tender terms, said officials.
Petrobangla on January 25 inked a term-sheet for the terminal-use agreement with the Excelerate to build the LNG import terminal after several rounds of negotiations and revising initial fiscal and technical terms.
The Excelerate has already carried out a met-ocean study and found building of the terminal viable.
The US firm also invited Petrobangla for a closing round of negotiation this month to resolve the pending issues and ink the final deal to build the LNG terminal.
The Excelerate Energy has estimated that the project investment would be around $ 500 million of which $200 million will be required to build fixed infrastructure including pipeline and mooring system and $300 million to build the FSRU ship. The US firm will build the terminal within 16 months of signing the final deal. LNG import might start from 2017.
The terminal would have a capacity of 5.0 million tonnes per year and a re-gasification capacity of at least 500 million cubic feet per day (mmcfd). It will have berthing and mooring facilities for LNG tankers with a capacity of 138,000-260,000 cu m, with the construction contract to be awarded on a build-own-operate-transfer basis for 15 years.
Separately, Power Cell, a state-owned entity under the MPEMR, is also working to build the country’s first onshore LNG terminal at Matarbari on Moheshkhali Island. Power Cell sought to build the onshore LNG import terminal in the south-with a handling capacity of 3.5 million tonnes per year, on a build-own-and- operate basis.
Re-gasified LNG from the terminals are expected to be supplied to gas-guzzling industries including power plants and factories.
Bangladesh has started works to build infrastructure for using imported LNG for consumers.
State-run Gas Transmission Company Ltd (GTCL), is building a 91-km pipeline to carry re-gasified imported LNG from Moheshkhali Island in the Bay of Bengal to Anowara in port city Chittagong to facilitate its transmission to user-ends. Petrobangla has also inked a ‘confidentiality’ deal with Qatar’s Ras Gas in Doha in October last year over its planned import of LNG to meet the mounting natural gas demand of the South Asian country.
The country is now reeling under acute natural gas crisis with the daily average output of around 2,700 mmcfd against the demand for over 3,200 mmcfd, according to Petrobangla.
Bangladesh started facing natural gas crisis from 2009 with rapid industrialisation forcing Petrobangla to ration natural gas supplies to gas-guzzling industries, power plants, CNG filling stations and households.
