LNG Terminal Outage Deepens Bangladesh's Gas Crisis, Hits Industries

Bangladesh is grappling with a severe gas shortage after a technical failure at one of its two floating liquefied natural gas (LNG) import terminals sharply reduced supplies to the national grid, disrupting industrial production, power generation, transport services and households.

The disruption began after a fire caused mechanical damage to the floating storage and regasification unit (FSRU), suspending gas supply from the terminal, according to multiple reports.

According to Bangladesh's state-owned Petrobangla, the incident was caused by a spark in a control panel, leading to the loss of around 17 million cubic metres of gas supply per day.

Before the outage, the Excelerate-operated terminal supplied up to 1,050 million cubic feet (mmcf) of gas daily to the national grid.

Following the incident, supply has fallen to below 500 mmcf, significantly widening the gap between demand and availability.

Bangladesh operates two FSRUs at Moheshkhali to regasify imported LNG, with the second terminal managed by Summit Group.

Together, the facilities play a critical role in supplementing declining domestic natural gas production.

The outage has reduced the country's total daily gas supply to below 2,150 mmcf from around 2,650 mmcf earlier, against estimated daily demand of nearly 3,800 mmcf.

Petrobangla is currently able to meet only about 56 per cent of national gas demand, resulting in widespread shortages.

According to Titas Gas Transmission and Distribution PLC, gas supply across its distribution network has dropped to around 1,150 mmcf per day from nearly 1,500 mmcf, while demand remains close to 1,900 mmcf.

The shortfall has affected industrial clusters, compressed natural gas (CNG) filling stations and residential consumers across the country.

The textile and manufacturing sectors have been among the worst affected, with several factories reportedly reducing production by as much as 40 per cent because of inadequate gas availability.

Energy experts said the disruption has exposed structural weaknesses in Bangladesh's energy security, pointing to the country's increasing reliance on imported LNG as domestic gas reserves continue to decline.

Analysts also warned that relying on only two LNG import terminals has created a fragile supply chain, where any technical disruption at a single facility has an immediate impact on the national energy system.