[🇧🇩] Energy Security of Bangladesh

[Saif]

Gas distributors doing ‘crafty’ business

Some public gas distributors continue to sell what they say more gas than they purchase and they boast officially the impossible feat as system gain, although the assertion is beyond logic and is often described in a bad light by energy experts.

www.newagebd.net

Gas distributors doing ‘crafty’ business
Some sell more gas than they buy while others sell far less than ideal
Emran Hossain 05 July, 2025, 00:30

Some public gas distributors continue to sell what they say more gas than they purchase and they boast officially the impossible feat as system gain, although the assertion is beyond logic and is often described in a bad light by energy experts.

Two of the six gas distribution companies in their attempts to justify system gains said that they, unlike their four other peers, were never involved in gas theft and that they had in place an airtight gas network management.

The explanation refers to the high system loss prevailing in four public gas distributors, some of whom often see their system loss reach double digit against the global standards of 2 per cent.

In February, the latest month for which official gas distribution data are available, Petrobangla put the average gas distribution system loss to be 6.68 per cent, marking a better performance by the distributors compared with their previous month’s record of 7.96 per cent.

Titas Gas Transmission and Distribution Company Ltd distributing half of all gas consumed, which is 2,600mmcfd on average, reported as high as 9.21 per cent of system loss in February, after its performance significantly improved compared with that in the month before, with a system loss of 10.53 per cent.

‘Of course, there are a lot of areas where our services can improve,’ Md Rezanur Rahman, chairman of Petrobangla, told New Age about the overall gas transmission and distribution performance.New Age merchandise

Bangladesh’s strange cases of system loss and system gain, energy experts said, are more of an indication of intentional manipulation of transmission and distribution systems than of technical problems.

In other words, they said, system loss and gain can be described as clear evidences of stealing of gas and inefficiency of government officials.

Comprised of a network of pipelines, a gas distribution system delivers natural gas received from the transmission system to end users such as residential, commercial and industrial customers. Distribution and transmission of gas is completely taken care of by publicly owned companies. Imported LNG is blended with local gas before they are supplied in the national grid.

Associated equipment that gas transmission and distribution companies use includes regulators, which controls pressure, and meters and valves, which is connected to gas flow control.

Distributors receive gas in high pressure from the transmission company, Gas Transmission Company Limited. The GTCL supplies gas in a pressure of 200 pounds per square inch (psi).

The sale of a gas distributor should ideally be slightly less than what it purchased thanks to losses from evaporation and leakage. Abnormal loss or gaining of gas during distribution is clear sign of fraudulence or illegal activities, energy experts said.

Shahjahan al Mamun, general manager (operation) at Pashchimanchal Gas Company Limited, admitted that by claiming system gain they categorically said they sold more gas than what they bought, but he failed to give any logical explanation of achieving such an impossible feat.Bangladesh-themed souvenirs

‘Unlike most other distributors, we don’t have gas theft and leaking pipelines,’ said Shailoja Nanda Basak, general manager (marketing) at PGCL, while sharing the cause of his company’s system gain.

Officials at the PGCL said that they gained gas as they reduced its pressure while distributing compared with pressure at which they received gas from the transmission company. Power plants receive the maximum pressure of 150psi while the industries and captive power plants receive gas with a pressure of 15psi.

The commercial and residential customers receive piped gas with a pressure of only 0.5psi. But often gas pressure drops to just zero at the consumer end.

Reduction in pressure allows gas to expand, the PGCL officials explained, increasing its volume, which is the only unit by which gas supply is measured for billing customers. The distributors never take into account factors such as temperature, pressure and molecular elements, which the transmission company measures before supplying gas to distributors.

In February, the PGCL reported a system gain of 1.40 per cent, which was more than one percentage points higher than the previous month.

Sundarban Gas Company Limited, on the other hand, reported 1.44 per cent of system gain in February.

When asked about how this happened, SGCL general manager (marketing) Md Zahir Uddin said that the matter was complex and could not be so simply understood.

SGCL managing director Gautom Chandra Kundu said that there could be metering error behind their success, but insisted that a deviation of 2 per cent in distribution account was globally acceptable.

Consumers alleged inaccurate metering and tampering of meters are rampant.

The SGCL and the PGCL are rather new with relatively modern system in operation. They also cover small areas and their residential users are small families unable to consume more gas than what they need, unlike what happens in mess in towns and cities like Dhaka.

Energy experts said that residential customers consuming more gas than what they paid for was an unrealistic proposition. Until some of the consumers switched to pre-paid meters, residential customers used to pay a set monthly bill for an assumed consumption of 77 and 72 cubic meters against double and single burners, respectively.

In June 2022, the BERC reduced the assumed consumption to 66 and 55 cubic meters, ruling that the customers’ actual use is 40 cubic meters and that they have all been overbilled by gas companies.

Commercial industrial and captive users often complain of receiving gas with one or two psi, far less than they are supposed to get.

Gas companies did not meter gas transmitted or distributed for decades, billing consumers for assumed consumption based on their annual expenses.

All gas companies kept reporting system gain even a decade back when system loss mostly did not exist.

Karnaphuli Gas Distribution Company Limited reported almost 8 per cent system gain in 2023-14 following years of presenting similar record.

Bakhrabad Gas Distribution Company Limited reported 2.10 per cent system gain in the same financial year while Jalalabad Gas Transmission and Distribution System Limited reported the only system loss of 0.51 per cent in the same year.

Titas Gas Transmission and Distribution Company Ltd, on the other hand, reported 1.32 per cent of system gain in the same financial year.

‘All these accounts of system loss or gain hold no water for there was no metering system until 2023,’ said Titas managing director Shahnewaz Parvez.

Earlier, the transmission company distributed its cost on distribution companies based on assumed consumption, never using meters to determine the amount of gas it was actually supplying.

A tension still persists between the transmission and distribution companies for the latter believe the former’s recently introduced metering system was not properly working.

Distributors also use meters that are not properly calibrated and vary in reading for they are bought from different manufacturers.

Gas meets over half of Bangladesh’s primary energy need. Bangladesh’s industry expanded mainly based on gas, which started flowing through pipes even before the country won its independence in 1971.​

 

[Saif]

Gas crisis deserves priority attention

Our industrial and economic future depends on it

www.thedailystar.net

Gas crisis deserves priority attention
Our industrial and economic future depends on it

VISUAL: STAR

The news of the government's failure to provide gas connections to over 1,000 industrial units and factories—despite more than 400 applicants having completed all formalities, including the payment of required fees—is indeed concerning. Among them is a factory established by Lantabur Group at the cost of Tk 700 crore. The company received its demand note for the connection as early as November 2022. Once operational, the facility was expected to employ around 1,500 people. Yet, despite construction being completed six months ago, it remains non-operational due to the lack of gas supply. In the meantime, the company has already begun repaying bank loans despite not having generated any revenue from it.

Unfortunately, this is not an isolated case. The 400 applicants currently awaiting connections include both new and expanded factories, as well as those seeking an increase in gas supply. A further 600 factories have applied for connections but have yet to receive any assurance of approval. This clearly demonstrates the extent to which industrial and economic growth is being held back by the ongoing gas connection crisis.

Industrialists have been sounding the alarm on this issue for years. However, the Awami League government, during its tenure, was heavily reluctant to invest in domestic gas exploration even though expert assessments indicated considerable potential. Instead, it placed excessive reliance on imports. With global gas prices having fluctuated drastically in recent years, this dependency has, unsurprisingly, proven costly. Consequently, industries have suffered and continue to do so.

The Awami League government also burdened the energy sector with massive debt through corruption and poor governance—debt that the interim government is now having to repay. But this has significantly reduced its financial flexibility. Although it has rightly prioritised domestic gas extraction, the benefits of such efforts will take time to materialise. That said, while it may be risky for the government to take on added financial pressure to rapidly boost gas supply, it should seriously consider it simply to stimulate industrial activity and accelerate economic recovery in the short term.

At present, the country supplies around 2,800-2,900 million cubic feet (mmcf) of gas per day, against a demand of 3,800 mmcf. And just over 1,200 mmcf is allocated to the industrial sector. To provide all promised connections, an additional 100 mmcf will be required. We urge the authorities to explore all viable options for acquiring this additional supply. Furthermore, the entrenched corruption in the energy sector—including credible allegations that some suppliers demand bribes in exchange for gas connections—must be thoroughly investigated and eradicated.​

 

[Saif]

Petrobangla picks 8 banks for LNG imports backed by WB guarantee

State-run Petrobangla has selected eight local and foreign commercial banks to facilitate the import of expensive liquefied natural gas (LNG), backed by a repayment guarantee from the World Bank (WB), as Bangladesh seeks to secure its future energy supplies and ease pressure on foreign exchange res

thefinancialexpress.com.bd

Petrobangla picks 8 banks for LNG imports backed by WB guarantee

M Azizur Rahman
Published :
Jul 05, 2025 23:48
Updated :
Jul 06, 2025 22:31

State-run Petrobangla has selected eight local and foreign commercial banks to facilitate the import of expensive liquefied natural gas (LNG), backed by a repayment guarantee from the World Bank (WB), as Bangladesh seeks to secure its future energy supplies and ease pressure on foreign exchange reserves.

Following a competitive tender, Petrobangla shortlisted three foreign banks - Germany's Deutsche Bank, the Development Bank of Singapore, and Standard Chartered - and five local banks - Prime Bank PLC, Eastern Bank PLC, Dutch-Bangla Bank, the City Bank PLC, and BRAC Bank PLC - to provide financial support for LNG imports starting in 2026.

"These banks and financial institutions were selected from among 31 banks and 11 consortiums that submitted bids," said AKM Mizanur Rahman, director (finance) of Petrobangla, speaking to The Financial Express on Saturday.

The selected banks will form a consortium to provide Petrobangla with a stand-by letter of credit (SBLC) worth US$200 million, valid for up to 12 months, in favour of long-term LNG suppliers under existing sales and purchase agreements (SPAs).

They will also offer an additional SBLC worth $50 million, valid for up to 90 days, for spot LNG suppliers under master sales and purchase agreements (MSPAs).

In addition, the banks will provide a $100 million credit line in the form of short-term loans with up to a 12-month tenor to help Petrobangla meet payment obligations for specific LNG cargoes under the SPAs and MSPAs.

Petrobangla officials said negotiations are in the final stages before signing the agreements. This financing arrangement comes after the World Bank's board of executive directors approved $350 million in late June under its Energy Sector Security Enhancement Project.

The project aims to improve Bangladesh's gas supply security by facilitating access to affordable financing for LNG imports.

The project will use an International Development Association (IDA) guarantee to mobilise up to $2.1 billion in private capital over the next seven years to support LNG imports.

The IDA, the World Bank's soft-lending arm, will guarantee Petrobangla's repayment obligations to the banks for loans and SBLC draws, covering up to $350 million in principal and accrued interest. However, the guarantee will not cover penalties, default interest, or similar charges.

This marks the first time the World Bank has extended assistance to Bangladesh through a guarantee facility specifically for LNG imports. The multilateral lender typically provides development project loans and budgetary support to the country.

The IDA guarantee is expected to enhance Petrobangla's credit profile, enabling it to secure LNG supplies more effectively amid mounting foreign currency constraints.

The World Bank noted that LNG now accounts for over a quarter of Bangladesh's total gas consumption, with imports costing around $4.5 billion annually.

Approximately 42 per cent of the country's gas is consumed by the power sector, making LNG supply disruptions a major risk to electricity generation and overall economic activity.

"The project will help Bangladesh enhance gas supply security in a cost-efficient manner, contributing to reliable and affordable electricity for industries and domestic users," said Olayinka Bisiriyu Edebiri, a senior energy specialist at the World Bank.

Bangladesh's growing dependence on imported fuels continues to strain its economy, especially due to challenges in securing foreign currency for essential imports.

Since LNG imports began in 2018, Bangladesh has imported around 30.64 million tonnes of LNG as of May 2025, according to official data from Rupantarita Prakritik Gas Company Ltd.

With domestic gas reserves rapidly depleting, Bangladesh is expected to need 30 million tonnes of LNG per year by 2041 to meet surging demand. A recent study by Danish consultancy Ramboll, in collaboration with the Geological Survey of Denmark and Bangladesh-based EQMS Consulting, warned that the country's existing gas reserves could be exhausted by 2038 without new discoveries.

Petrobangla projects that by 2041, daily gas demand could reach 8 billion cubic feet, significantly higher than the current supply of around 2.87 billion cubic feet per day.

Of this, approximately 1.02 billion cubic feet come from imported LNG, while 1.85 billion cubic feet are sourced from domestic production.

The banks involved in the financing are optimistic about their role in supporting Bangladesh's energy security.

"Prime Bank is ready to assist and facilitate the government's efforts to secure the country's energy supply," said Tanjil Chowdhury, chairman of Prime Bank. "We have a strong balance sheet and are fully capable of meeting Petrobangla's financing needs. We are proud to partner with the government."

Bangladesh recently cleared all its overdue LNG import bills after facing payment challenges over the past three years.

Petrobangla officials noted that the IDA guarantee, alongside an existing $600 million loan agreement with the International Islamic Trade Finance Corporation (ITFC), will enable the country to make timely payments for LNG imports going forward.​

 

[Saif]

Govt should end fraudulence in gas distribution

TWO of the six public gas distributors claim system gains, noting that they have sold more gas than they have purchased. The other four public gas distributors are reported to have been plagued by high system losses. The gainers claim an advantage in...

www.newagebd.net

Govt should end fraudulence in gas distribution
06 July, 2025, 00:00


TWO of the six public gas distributors claim system gains, noting that they have sold more gas than they have purchased. The other four public gas distributors are reported to have been plagued by high system losses. The gainers claim an advantage in the ranges of 1.4–1.44 per cent whilst, as the February data show, the average system loss has been 6.68 per cent for others. Yet, Titas Gas Transmission and Distribution Company, which distributes a half of gas consumed, 2,600mmcfd on an average, reports to have faced a system loss of 9.21 per cent after a significant improvement in its performance compared with the figure the month before, when the system loss of the company was 10.53 per cent. The global standard of system loss remains 2 per cent. Energy experts, however, say that both the system loss that the distribution companies face and the system gain that the distribution companies claim are nothing but the stealing of gas, inefficiency of government officials and irregularities of the distribution companies. The loss and the gain are an indication of a deliberate manipulation of the transmission and distribution systems rather than technical problems.

In addition to Titas Gas reporting system loss in February, the three other entities that report system loss are Bakhrabad Gas Distribution Company, Jalalabad Gas Transmission and Distribution System and Karnaphuli Gas Distribution Company. Viewed against the global standard of system loss, the four entities are definitely plagued by irregularities as they have reported loss that is much higher in February compared with the figures the month before even after improvement in their performances. But the case of Sundarban Gas Company that has reported a 1.44 per cent system gain and Pashchimanchal Gas Company that has reported a 1.4 per cent system gain appear curious. No company can sell gas more than what it buys from Gas Transmission Company. The catch, therefore, lies elsewhere. The distribution companies buy gas from Gas Transmission Company at the maximum pressure of 150 pounds per square inch, but industries and captive power plants get the gas at 15psi. Commercial entities and households receive gas at only 0.5psi, which often declines to 0psi at the consumer end. A reduction in pressure allows gas to expand, increasing its volume, the only unit by which the supply is measured in billing customers. Factors such as temperature, pressure and molecular elements, which the transmission company maintains, are ignored, making the apparent gain, which is nothing but fraudulence.​

 

[Saif]

Energy assoc urges review of scrapped solar plans

The Bangladesh Sustainable and Renewable Energy Association yesterday urged the interim government to reconsider its cancellation of 31 letters of intent that the past regime had signed with potential investors in solar power projects without adopting any tender process...A letter of

www.thedailystar.net

Energy assoc urges review of scrapped solar plans

The first on-grid solar plant, set up on eight acres of land under Sarishabari Sales and Distribution of Power Development Board in Sarishabari upazila of Jamalpur, has reduced load-shedding and air pollution in the upazila. PHOTO: STAR

The Bangladesh Sustainable and Renewable Energy Association yesterday urged the interim government to reconsider its cancellation of 31 letters of intent that the past regime had signed with potential investors in solar power projects without adopting any tender process.

A letter of intent is a document outlining the preliminary understanding between two or more parties who intend to enter into a formal agreement.

It is essentially a blueprint for a deal, setting out key terms and conditions before a legally binding contract is finalised.

Last week, the Centre for Policy Dialogue (CPD) also sought a review of the letters of intent.

The floating of tenders seeking bids for 55 new solar power projects was a positive development, but these did not draw foreign investors as expected, said the association.

"In some cases, only one bidder has shown interest, while in others, no one has participated at all," said Mostafa Al Mahmud, president of the association, at a press conference at the Dhaka Reporters' Unity.

Around $300 million has already been invested in the cancelled projects, and the interim government's decision might create a sense of distrust among investors, he said.

Besides, the interim government has cancelled a provision under "implementation agreements" that enabled refunds of investments in cancelled projects, he said.

The refunding is necessary for the expansion of renewable energy generation capacity in the country, he added.

Mahmud thanked the government for updating the renewable energy policy and demanded a specific roadmap towards meeting the renewable energy target.

He said the High Court has already issued a directive to install rooftop solar systems on all buildings, but a clear roadmap such as on the engineering, procurement, construction, and financing aspects has yet to be made available.

The press conference highlighted that increasing the generation of renewable energy is now a national imperative.

Bangladesh is becoming increasingly dependent on energy imports due to a steady decline in gas production, putting substantial pressure on foreign currency reserves, it said.

The association demanded tax benefits for the renewable sector and thanked the government for reducing the customs duty on solar inverters to 1 percent from 10 percent.

"We believe that this kind of tax reduction should be extended to other essential solar components as well, like mounting structures, DC cables, controllers, batteries, and solar pumps—duties on which are still high," it said.

Their demand includes the implementation of net metering guidelines, ensuring the installation of rooftop solar panels on all residential buildings in urban areas, forming a modern monitoring and support framework, and the withdrawal of the 7.5 percent trade VAT.​

 

[Saif]

RPGCL reissues tender to buy 2 spot LNG cargoes for August deliveries

State-run Rupantarita Prakritik Gas Company Ltd (RPGCL) has reissued tender to buy two LNG cargoes, scheduled for delivery during August 21-22, and August 28-29. Each cargo will contain 3.36 million British thermal unit (MMBtu) and will be delivered to Moheshkhali Island in the Bay of Be

thefinancialexpress.com.bd

RPGCL reissues tender to buy 2 spot LNG cargoes for August deliveries

FE ONLINE REPORT
Published :
Jul 16, 2025 20:23
Updated :
Jul 16, 2025 20:23

State-run Rupantarita Prakritik Gas Company Ltd (RPGCL) has reissued tender to buy two LNG cargoes, scheduled for delivery during August 21-22, and August 28-29.

Each cargo will contain 3.36 million British thermal unit (MMBtu) and will be delivered to Moheshkhali Island in the Bay of Bengal, with discharge at either of the country's two floating storage and regasification units (FSRUs) located there.

The bid submission deadline is July 20, a senior RPGCL official said.

The RPGCL has sought the selected short-listed spot liquefied natural gas (LNG) suppliers to re-submit bids as the previous tender faltered due to higher-than-expected price quotes.

Bangladesh has already bought two spot LNG cargoes for delivery in August, said the official.

The country previously procured five spot cargoes in July and six in May, the highest in any single month so far.

RPGCL, a wholly-owned subsidiary of Petrobangla, is responsible for handling the country's LNG imports.

Bangladesh currently imports LNG under long-term supply contracts with QatarEnergy and OQ Trading International, and supplements this supply with short-term spot market purchases as needed.

The country's two operational FSRUs at Moheshkhali have a combined re-gasification capacity of 1,100 million cubic feet per day (mmcfd). Yet the gas supply deficit persists, driven by rapidly depleting domestic natural gas production.

As of July 15, 2025, Bangladesh's total natural gas output, combining both local production and imported LNG, stood at 2,844 mmcfd, while estimated demand exceeded 4,000 mmcfd, according to official data.

This shortfall has forced authorities to ration gas supply to power plants, industrial units, and other key consumers to manage the ongoing crisis.​