Energy to remain a big challenge for 6 months: Salman F Rahman

As he rules out importing gas from Russia, Salman F Rahman, Adviser for Private Industry and Investment to the Prime Minister, said that meeting home demand for energy will be a major challenge for the country in the next six months.

“We made a plan to import crude oil from Russia but it is not possible right now as Bangladesh has no equipment to refine the oil,” Rahman said while addressing a programme at Bangladesh Investment Development Authority (BIDA) in Agargaon area of Dhaka on Saturday.

He said the entire world is facing a crisis of energy and power and Bangladesh is not out of the impact.

Earlier, Bangladesh received an offer from Russia to buy its crude oil amid the global power crisis in the backdrop of Russia-Ukraine war.

This adviser to the prime minister said, “The way the price of liquefied natural gas (LNG) was hiked globally, Bangladesh fell into trouble, but we hope that the price will come down soon. If the prices do not come down, the crisis will worsen.”

While responding to a question, whether alternative methods of importing oil from any other country other than Russia are being considered or not by the government, he said, “Discussions are going on about importing oil from Qatar. If they want to sell oil outside the spot market, we will agree. Efforts are underway to bring it from India as well.”

Salman said, “Even if the price of diesel increases in the world market, we can import it from anywhere. But the problem is gas. Some 80 percent of the country’s power plants run on gas. The price of gas in the spot market in the international market is so exorbitant that it has become difficult to import. Therefore, from now on, importance should be given to extracting gas from the home gas fields.”

In response to a question, he said, “In order to enter into an agreement with foreign companies regarding gas extraction, the existing Production Sharing Contact or PSC must be amended. Because this PSC is very old. In the meantime, the government has finalised the draft of PSC. Once this is done, we will be able to invite new tenders involving foreign companies.”

Regarding the introduction of coal-based power plants, he said, “Many countries, including Germany, have started power generation with coal, because they have no problem over coal supply. Bangladesh has many problems. Even if it starts now, it will take some five years to go into production.”

“Climate is a big issue for us. So, before changing the coal policy, we have to think a lot,” he added.

The adviser to the prime minister also said, “Bangladesh’s foreign debt ratio is still very bearable compared to GDP. Because some 90 percent of our loans are flexible and the cost of funds is low. Bangladesh does not usually borrow commercially, which many countries in the world do.”

As the debt is still bearable, some quarters are spreading unnecessary panic. “I think Bangladesh’s macro economy is still better than many countries. There is no reason to worry about the economy.”