By Ruma Paul
DHAKA, Sept 29 (Reuters) - Bangladesh has shortlisted 17 companies for its spot tender process as it plans to buy around 1 million tonnes of liquefied natural gas (LNG) next year to capitalise on lower prices for the super-chilled fuel, two company officials said.
Petrobangla, in charge of LNG imports into the South Asian country, plans to sign sales and purchase agreements with the shortlisted companies after it receives cabinet approval, the officials with direct knowledge of the matter said.
“We are moving ahead with plans to import LNG through the spot market by shortlisting 17 companies out of a total of 43,” one of the Petrobangla officials said.
The companies shortlisted are Mitsui, Marubeni , Osaka Gas, AOT Energy, Diamond Gas, Summit Oil & Shipping, Excelerate Energy, Jera, Gazprom, Vitol, Trafigura, Woodside Petroleum, Eni, Petronas, CNOOC, Cheniere and Chevron, the official said.
Asian spot LNG prices <LNG-AS> are currently at their lowest in years due to new supply entering the market from the United States, and as demand growth slows in major economies.
Traders who sign the sales and purchase agreements will then be able to participate in spot tenders Petrobangla will issue when cargoes are needed, said the officials, who declined to be identified because they are not authorised to talk to the media.
One of the officials said the state-owned company could buy about 1 million tonnes next year through the spot market.
The nation of 160 million people is expected to become a major LNG importer in Asia, alongside Pakistan and India, as domestic gas supplies fall.
Bangladesh's annual imports of liquefied natural gas (LNG) could nearly triple to at least 10 million tonnes over the next three to four years, Tawfiq-e-Elahi Chowdhury, energy adviser to Bangladesh's prime minister, told Reuters on Thursday.
The country currently has two floating storage and regasification units (FSRUs) with a total regasification capacity of 1 billion cubic feet per day - equal to about 7.5 million tonnes a year.
It is also building a land-based terminal that can handle 7.5 million mtpa of LNG, expected to be ready in five years.
Petrobangla already imports about 300-400 million cubic feet per day of LNG - equivalent to 3.5 million tonnes a year in total - through two long-term contracts with Oman and Qatar.
Bangladesh has a 10-year LNG import deal with Oman Trading International. That LNG is priced at 11.9% of the three-month average price of Brent crude oil plus a constant price of 40 cents per million British thermal units (mmBtu).
Under its 15-year deal with Qatar, Bangladesh pays 12.65% of the three-month average price of Brent oil plus a constant of 50 cents per mmBtu.
Last year, Bangladesh scrapped a deal with Swiss energy trader AOT Energy, which had been close to being finalised. (Reporting by Ruma Paul; Editing by Stephen Coates)