As of November, Bangladesh’s state-owned Petrobangla has accumulated a debt of approximately $36.7 million for LNG imports, equivalent to about 4,511 crore BDT. Along with settling this amount, Petrobangla has requested a subsidy or government grant of 5,000 crore BDT to cover LNG import costs until the end of December. A letter from the Ministry of Power, Energy, and Mineral Resources has urged the Ministry of Finance to expedite the release of these funds, warning that failing to pay the outstanding debts could result in a disruption of gas supply.

The letter mentions that Petrobangla received a subsidy of 6,000 crore BDT for LNG imports in the 2023-24 fiscal year and planned a similar subsidy for the 2024-25 fiscal year. However, the Finance Ministry has only released 2,000 crore BDT so far, which has already been spent on LNG payments. Petrobangla faced a deficit of 24,981 crore BDT in 2021-22 due to LNG imports and gas pricing set by the Bangladesh Energy Regulatory Commission (BERC). Even after an 80% increase in gas prices in February 2023, a deficit of 4,287 crore BDT remained for the 2022-23 fiscal year. To address these deficits, Petrobangla utilized resources from energy security funds, government grants, loans from the Gas Development Fund, and retained earnings of affiliated companies.

As of November, 26.67 million USD (about 3,280 crore BDT) has been paid for LNG imports, and further payments of 123.1 crore BDT (10 million USD) are due for loans taken from the International Islamic Trade Finance Corporation (ITFC). Petrobangla’s bank account holds 1,578 crore BDT, but there is a shortfall of nearly 3,000 crore BDT. Additionally, Petrobangla is set to import 12 more LNG cargoes by the end of December, leading to a potential deficit of 5,782 crore BDT between expenditure and revenue. The letter warns that failure to pay on time could lead to the suspension of LNG deliveries by long-term suppliers and incur additional costs due to interest. The Ministry of Power, Energy, and Mineral Resources has requested a 5,000 crore BDT subsidy for Petrobangla to ensure the uninterrupted supply of LNG.

An official from the Ministry of Finance stated that the current budget allocates 7,000 crore BDT for this purpose, of which 2,000 crore BDT has already been released. However, it remains uncertain if the entire allocated amount will be disbursed this fiscal year.