LNG imports disrupted after FSRU fire, gas shortage to persist for 10-15 days: Power Minister

A fire at one of Bangladesh's two Floating Storage and Regasification Units (FSRUs) has disrupted liquefied natural gas (LNG) imports, worsening the country's ongoing gas shortage and affecting electricity generation as well as industrial production, Power, Energy and Mineral Resources Minister Iqbal Hassan Mahmood said on Monday.

Speaking at a policy roundtable titled "Navigating Global Shifts: Fostering Energy Security and Resilience in Bangladesh" at a city hotel, Mahmood said the damaged FSRU is expected to return to operation within 10 to 15 days.

"About a week ago, there was a fire at one of the FSRUs. Fortunately, it was not a major disaster, but the unit is now undergoing repairs and will take another 10 to 15 days to be fully restored," he said.

The event was organised by the Bangladesh Institute of Peace and Security Studies (BIPSS), with its President, Major General ANM Muniruzzaman (Retd), moderating the discussion.

Mahmood said Bangladesh currently has two LNG cargoes waiting offshore but is unable to unload them because of the disruption.

"As a result, there is a severe gas shortage across the country. Households are experiencing low gas pressure, while industries and power plants are also suffering," he said.

He noted that Bangladesh's power sector remains heavily dependent on natural gas, while alternative fuels, including LNG and coal, are largely imported.

Many gas-fired power plants are currently unable to operate because of fuel shortages, although capacity payments to private power producers continue, he added.

The minister said Bangladesh imported fuel worth around US$3.65 billion over the past six months, placing additional pressure on the country's foreign exchange reserves amid persistently high global prices for gas and other fossil fuels.

He also attributed the mounting financial strain in the power sector to unpaid liabilities inherited from the previous government.

According to the minister, the government inherited outstanding dues of around 56,000 crore taka owed to private power producers, while continuing to meet monthly subsidy obligations.

Mahmood said the government has stepped up efforts to expand renewable energy to reduce the country's reliance on imported fossil fuels.

He said Bangladesh recently adopted a new renewable energy policy aimed at adding 10,000 megawatts of renewable electricity generation over the next five years.

Describing the target as ambitious but achievable, he said the government plans to promote both utility-scale solar projects and rooftop solar installations through greater private sector participation.

Under the proposed rooftop solar model, private investors will install solar panels on rooftops, recover their investment through net metering and receive payments based on the electricity supplied to the national grid.

The government also plans to establish cluster-based large-scale solar parks by allocating land to investors, while the Power Grid Company of Bangladesh (PGCB) will purchase the electricity generated.

Negotiations with prospective investors are underway, and the process of allocating land for new solar projects is expected to begin in August, he said.

Mahmood added that battery storage technology would play a key role in the country's renewable energy transition by enabling surplus solar power generated during the day to be used during evening peak demand.

"If we can achieve the target of 10,000 megawatts within five years, life will become much easier in the energy sector," he said.

In his welcome address, BIPSS President said Bangladesh must move beyond the conventional approach to energy procurement and pursue "energy sovereignty" to safeguard its economy and national security against growing global uncertainties.

He said energy security has become a strategic issue closely linked to macroeconomic stability, fiscal sustainability and national security.

"Our domestic natural gas reserves are depleting, pushing us towards greater dependence on imported energy and coal. Coupled with the escalating impacts of climate change, where increasingly erratic weather places additional pressure on energy demand, our current model is being severely tested," he said.

Muniruzzaman argued that Bangladesh needs to shift its focus from energy procurement to energy sovereignty, which he described as the country's ability to secure reliable and sustainable energy supplies while minimising exposure to external geopolitical risks.

He said developing a diversified, domestically anchored and regionally integrated energy system would help shield Bangladesh from external shocks while supporting long-term economic growth and national development.

He expressed hope that Bangladesh would steadily move towards a more resilient and energy-secure future.