Bangladesh's LNG market draws three-power rivalry

The growing demand for liquefied natural gas (LNG) in Bangladesh is drawing increasing interest from major global powers, with US, Russian and Chinese companies seeking a stronger foothold in the country’s energy sector.

Russia has recently entered the race with a $950 million proposal from UAE-based Novatek Middle East DMCC to develop a permanent LNG terminal at Maheshkhali in Cox’s Bazar.

The proposal comes as Bangladesh faces declining domestic gas production and rising dependence on imported LNG. The country currently imports around 10 LNG cargoes a month, with open-market purchases costing roughly Tk 10,000 crore monthly, according to the information presented in the proposal.

Novatek has proposed building a gravity-based structure (GBS) LNG terminal on the seabed, which it claims could have a lifespan of 60 to 80 years and provide storage capacity equivalent to about a month’s gas demand.

The company has offered two options for supplying regasified LNG to the national network. Under the first, gas would be transported through subsea pipelines after regasification. Under the second, smaller vessels would carry the gas through inland waterways to Meghnaghat, Ashuganj, Ghorashal and Bheramara for supply to power plants, industries and fertiliser factories.

The proposal has also raised geopolitical questions because Maheshkhali is already home to two floating LNG terminals operated by US-based Excelerate Energy. One of the terminals is owned by Summit Group but operated by Excelerate.

Meanwhile, Chinese company China National Energy Engineering and Construction Company (CNEE) has also proposed developing another floating LNG terminal at Maheshkhali, with a capacity to supply around 600 million cubic feet of gas per day.

If the proposed projects move forward, Maheshkhali could emerge as a major hub for LNG infrastructure involving companies linked to the United States, Russia and China.

However, questions remain over Novatek Middle East’s direct experience in developing gravity-based LNG terminals. The company’s proposal is yet to be approved by Petrobangla, and no agreement has been signed.

Energy experts have urged the government to conduct thorough technical, financial and geopolitical assessments before making any decision.

Professor Ijaz Hossain said Bangladesh should carefully examine potential risks, including any implications for its existing agreements with the United States. He also suggested that a permanent mega LNG terminal could be developed by Petrobangla itself rather than being handed over to a foreign company.

Professor Shamsul Alam, meanwhile, stressed the importance of diplomatic skill in dealing with competing interests. He said Bangladesh’s ability to balance relations with major powers would determine whether the country could turn the growing interest into an advantage.