INTERVIEW: Bangladesh LNG imports may hit 15 mil mt/year on economic growth: Summit Chairman
International LNG prices to stay supported
Securing 20% tariff on exports to US an 'enabler'
Summit's second FSRU plans under judicial review
Bangladesh’s LNG imports could reach 15 million mt/year in the coming years once the South Asian country achieves a 6%-7% gross domestic product growth, Summit Group Chairman Muhammed Aziz Khan told S&P Global Commodity Insights in an interview.
Bangladesh's economic growth in fiscal 2024-25, which ended June 30, was expected to be its lowest in years. According to a statement on the World Bank's website in April, it predicted a 3.3% growth for Bangladesh in FY25. The South Asian country’s economy continues to face significant challenges, including reduced investment, high inflation, and vulnerabilities in its financial sector, the bank said.
Despite the challenges, Khan said Bangladesh's year-to-date spot LNG import volumes in 2025 are among the highest in recent years.
“While we see spot purchases, this is only the tip of the iceberg,” said Khan, who remains confident about the country’s future economic growth prospects.
Analysts at S&P Global Commodity Insights said in a recent report that Bangladesh's contractual volume will reach 7.2 million mt/year by 2027, more than doubling the 3.5 million mt/year in 2025. While Petrobangla has signed contracts to reduce spot market exposure, forecasts suggest that by 2030, 49% of Bangladesh’s LNG demand will still depend on the spot market, the analysts added.
According to Khan, international LNG prices will likely stay supported at the current level and will be rangebound in the coming months.
Platts, part of Commodity Insights, assessed the October JKM, the benchmark price for LNG cargoes delivered to Northeast Asia, at $11.001/MMBtu on Aug. 28, down 50 cents, or 4.35%, from the previous Asian close. It assessed the LNG DES Southeast Asia Marker, or SEAM, at $10.80/MMBtu on Aug. 28, down 4.42% day over day.
Khan said that global LNG prices are linked not only to demand and supply but also to geopolitics.
He said LNG storage capacity and production will grow significantly. However, the physical movement of the fuel is limited by the Russia-Ukraine war and the sanctions that followed, ongoing concerns about the Strait of Hormuz due to the Israel-Iran conflict, and continuing tensions in the South China Sea, which support prices.
Bangladesh’s interim government, formed in August 2024, has implemented a contractionary fiscal policy, which Khan said is necessary to improve the country’s macroeconomic conditions.
This has enabled the government to pay down its arrears to many energy suppliers, including clearing pending power sector dues, he said.
Bangladesh needs physical infrastructure, perhaps more than any other developing country, he shared.
Khan calls the recent achievement of securing a 20% reciprocal tariff from the US, compared to the 50% faced by some of its neighbors, an "enabler."
To take advantage of this, we must have more energy, better ports, and improved communication--internet, artificial intelligence, data center, etc., he said, adding that Summit has a presence in all three of those spheres.
Growth pursuits
“The implementation and progress of some of our projects have been delayed because of the political upheaval in Bangladesh and recent global geopolitical risks,” Khan said.
“Presently, we are in discussions with the Government of Bangladesh for the supply of 1.5 million mt/year of LNG,” he said.
In January, Petrobangla and the Bangladesh Ministry of Power, Energy and Mineral Resources issued a notice to Summit to terminate the country’s third and Summit’s second Floating Storage and Regasification Unit project.
“The Terminal Use Agreement, or TUA, was terminated outside the contract, and thus Sumit has moved to the courts for restoration,” Khan said.
Summit has invested over $20 million in various long-lead items and studies for LNG supply related to this FSRU project, which is intended to have a regasification capacity of 600 million standard cubic feet per day, he said.
The FSRU project is currently under the judicial review of the Supreme Court's High Court division of Bangladesh.
“We are certain that if the decision is judicious, lawful, and as per the contract, the termination would be void,” Khan said.
“We are vigorously pursuing the matter in the court to provide us relief at the earliest,” he added.
Delaying these projects is a missed opportunity because it hampers development and job creation. Khan said that the termination of the gas project could also impact the country's energy security.
Separately, the Summit Group also plans to build Bangladesh's first onshore LNG terminal at Matarbari Island in the Bay of Bengal on a build, own, operate, and transfer basis. However, the project is slightly delayed, he said.
According to Khan, the onshore terminal will have a capacity of 230,000 mt/year of LNG. Khan said that Summit is planning an FPSO in Khulna, with Matarbari as the principal storage facility.
Khan also said that a project to refine crude oil is also in the works. However, he added that the project is likely to be completed next year, closer to the time when the General elections are held.