Reuters are reporting that Bangladesh is close to signing a twice-delayed long-term LNG supply contract with Qatar but it will take less gas than initially planned and instead turn to spot cargoes amid a supply glut that has lower prices.
Bangladesh's deal with Qatar will be its first and will feed its import terminal starting up in 2018 that is designed to cover the country's domestic gas shortfall. The country's turn to the spot market highlights the trend of gas buyers seeking more flexibility in their purchases rather than being locked in to multi-year contracts.
Under the still pending deal, Bangladesh will buy less than the 4 million tpy of LNG that it agreed to in a 2011 memorandum of understanding with Qatar's state-owned RasGas.
Petrobangla is likely to finalise a deal for around 2.5 million tpy of LNG starting from early 2018.
The first floating storage and regasification unit that will start up in April 2018 can handle 3.75 million tpy of imports and the country will turn to spot purchases the market up the difference.
Bangladesh's domestic gas output is about 2.7 billion ft3 per day against demand of 3.3 billion ft3. That has left it unable to fuel its power plants and industry.
Read the article online at: https://www.lngindustry.com/liquid-natural-gas/14072017/bangladesh-opts-for-less-long-term-qatari-lng/