Bangladesh plans to pay $960 million each month beginning in July to clear its outstanding obligations to LNG suppliers, international oil corporations (IOCs), and power plant owners.
How does the payment system work?
Each week, $160 million will be paid to the Ministry of Power, Energy, and Mineral Resources (MPEMR)’s Power Division to settle debts with power plant owners, while $80 million will be allocated to the Energy and Mineral Resources Division (EMRD) to pay LNG suppliers and IOCs.The MPEMR’s Power Division has also asked $5.921 billion for fiscal year 2023-24 to ensure uninterrupted power delivery.
Bangladesh is seeking assistance from international lenders.
Petro Bangla is currently in talks with the Islamic Trade Finance Corporation to borrow $500 million. The government owes around $2.4 billion to private independent power producers, $475 million to India for electricity imports, $350 million to gas businesses, and $320 million to LNG providers as of June.
Despite losses in deep sea exploration efforts in the past, Prime Minister Sheikh Hasina’s government remains committed to making advances in the energy sector.