International Finance Corporation (IFC, the private sector arm of the World Bank) and Excelerate Energy Bangladesh (EEB) have signed a financing agreement for the construction of the Bangladesh LNG project. As a result, IFC will finance the project in the form of a debt-equity partnership (70% debt and 30% equity). IFC will lend up to U$125m, of which US$34.1m for its own account and an additional amount of US$91.4m in parallel loans while the remaining facility cost will come from equity participation of the IFC and EEB.
The 500 mcf/d (5.1 bcm/year) Bangladesh LNG terminal project is expected to cost US$179m and will include a floating, storage and regasification unit (FSRU) with a storage capacity of 138 mcm of LNG. It will increase the domestic gas supply by 20% and will be located close to the Moheshkhali Island in southeastern Bangladesh, 91 km from Chittagong.
EEB will develop the FSRU on build-own-operate and transfer (BOOT) basis. The reasified LNG from the terminal will be purchased on a take-or-pay basis by petroleum company Petrobangla, which will then supply the gas under the framework of back-to-back gas sales contracts with power plant owners or operators and other consumers at the user end.
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