3 studies before implementing Cox’s Bazar LNG project

Power Cell, a Power Division technical wing, has moved to conduct three comprehensive studies prior to implementing its 500 mmcfd capacity onshore LNG project in Cox’s Bazar, reports news agency UNB.

The studies will be carried out engaging international consulting firms to assess the technical, financial and environment aspects of the LNG (liquefied natural gas) project, said officials at the Power Cell.

According to them, the Power Cell has already received proposals from 12 international firms for the three studies. Five of them have submitted bids for a technical study, three for a financial study and four for an environmental study.

“We’re now evaluating their bid documents to select three of them. Each of the final three will be selected for one study,” Power Cell director general Mohammad Hossain told UNB.

Once the evaluation is completed, he said, they will seek approval from the Power Division for their appointment.

Earlier, the Power Cell had selected four international firms for setting up an onshore LNG terminal with re-gasification facilities of 500 mmcfd gas per day on build-own-operate (BOO) basis.

The main objective of the project is to provide gas supply to the gas-based public and private sector power plants in the future if and when the local gas production and supply will be depleting. World Bank’s commercial wing International Finance Corporation (IFC) has been supporting the move.

But at that stage of the selection process, the donor agency advised the government to conduct the three studies first before proceeding for any contract with any firm, said a Power Cell official adding, “Because, such studies are very essential to determine the technical, financial and environment viabilities of the project.”

Without any feasibility study on these three aspects, no international bidder will take any risk and similarly, nor any financial agency will come up to finance the project, he said.

The Power Cell official also informed that primarily two possible sites-Materbari and Pekua-were chosen for the LNG project. Now Moheshkhali is included as possible site for the project.

“But after the three studies, on the basis of the study-findings, one of the three locations will be finalised for the project,” he added.

The planned onshore terminal will be the country’s second liquefied natural gas (LNG) terminal. The Power Cell floated tender in mid-April last year, seeking expressions of interest (EOIs) from international companies to build the onshore LNG import terminal.

The government has already signed a contract with a Singaporean firm to set up a similar capacity LNG terminal with floating storage and re-gasification unit (FSRU) in the offshore of Moheshkhali Island.

State-owned Petrobangla is implementing the Moheshkhali LNG terminal project, which will import LNG and then take the storage and re-gasification service from the terminal and supply it to the country’s gas network.

But the Power Cell-moved one will be set up as an onshore storage and re-gasification LNG terminal. The Power Cell will import LNG and take service from the terminal to supply the gas to the public and private power plants.

Source: Prothom Alo. Date: Oct 29, 2016