The reason behind the gas crisis

Rafiqul Islam Selim

A US-bound LNG carrier has arrived at Maheshkhali’s floating LNG terminal, paving the way for the restart of Summit Power Ltd’s terminal. The vessel, BW Lesmes, carrying 66,000 tonnes of LNG, arrived ahead of schedule on Friday evening. Gas supply from the terminal was expected to resume overnight and increase from Saturday morning.

The arrival comes amid a severe gas crisis, with national gas supply falling to 1.88 billion cubic feet per day—the lowest in 16 years. The shortage has disrupted industries, power generation, CNG stations, public transport and household cooking. The crisis began after a fire at Excelerate Energy’s floating LNG terminal on July 21. The terminal remained largely shut for 17 days and resumed partial operations on August 5 through one boiler. However, supply has again fallen sharply following a dispute over an LNG cargo imported from Saudi Aramco.
Bangladesh normally imports LNG through membrane-type carriers, but the government recently brought in a Moss-type carrier, Al Hamra, under a government-to-government arrangement with Saudi Aramco. Excelerate has refused to allow the cargo to unload at Summit’s terminal, describing the vessel as old, risky and unsuitable for the terminal. However, officials of the state-owned Rupantarita Prakritik Gas Company Ltd (RPGCL) disputed Excelerate’s claim, saying a similar Moss-type carrier named Marayeh unloaded LNG in Bangladesh in 2021 through the same terminal.

One source said insurance-related objections may also have prevented the Al Hamra from berthing. A Petrobangla official said the government had asked Aramco to replace the cargo, as the contract allows replacement if a cargo is unsuitable. Officials said the cargo has remained offshore for four days, worsening the gas shortage. Energy State Minister Mr. Anindya Islam Amit reportedly met Excelerate’s adviser and former US ambassador to Bangladesh Mr. Peter Haas and requested permission to unload the cargo. Excelerate, however, maintained that it would not take the risk.

Excelerate and Summit officials said the Al Hamra was an old-model vessel and was not included in the list of carriers approved for the terminal. RPGCL officials rejected this explanation, pointing to the 2021 Marayeh shipment. The two floating terminals at Maheshkhali are operated by Excelerate. Petrobangla purchases LNG through long-term contracts and the international spot market and supplies it to the terminals for regasification.

Bangladesh’s daily gas demand is around 3.8 billion cubic feet, while normal supply is about 2.7 billion cubic feet, including roughly 1 billion cubic feet from imported LNG. With one terminal shut, supply has fallen to its lowest level in 16 years. Although Summit’s terminal is restarting, officials said the overall situation may take at least a week to improve. Excelerate’s damaged boiler will also require testing, during which gas supply from the terminal may again be suspended for up to 72 hours. The latest crisis has raised questions over whether the series of incidents surrounding Excelerate’s terminal is linked to the worsening national gas shortage. Some concerned officials have called for the matter to be investigated, including whether the crisis is being deliberately prolonged to create public dissatisfaction with the government.