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Bangladesh's central and southern regions will shape the
future gas story, but pipeline access remains a
bottleneck
Bangladesh's natural gas demand is mostly localized, with around
68% of the overall demand concentrated around the central,
northern, and eastern parts of the country. These regions are
located around legacy gas fields, which has contributed to the
establishment of the different demand centers ranging from the
power sector to industrial and residential consumers. In addition,
a robust transmission and distribution gas network was created for
these demand centers.
To facilitate regional demand, Bangladesh has established six
distribution companies, which are responsible for laying the
distribution network and supply gas in their respective franchise
areas. Among these, Titas Gas Transmission and Distribution Company
Limited (TGTDCL) is the largest distribution company, catering to
around 56% of the total gas demand, followed by Jalalabad Gas
Transmission and Distribution System Limited (JGDSL) with a 12.7%
share and Bakhrabad Gas Distribution Company Limited (BGDCL). The
other distribution companies Karnaphulia Gas Distribution Company
Limited (KGDCL), Paschimanchal Gas Company Limited (PGCL), and
Sundarban Gas Company Limited (SGCL) are smaller in size despite
their large geographical areas.
The power sector is expected to be the key driver for
gas demand in the medium term
Bangladesh currently has around 22 GW of installed grid-based
power plant capacity, with gas-based power plants contributing to
around 11.8 GW (54%). In terms of future power sector development,
around 10 GW of capacity is under the construction phase and around
6.5 GW under the planning stage. Out of this, more than 85% of the
total capacity is in the southern and central regions of the
country. Consequently, IHS Markit expects the Southern and Central
regions to shape the country's future gas story.
Pipeline limitations might be a constraint in realizing
this new demand
Bangladesh gas pipeline connectivity is limited around the
southern parts of the country, especially in the south-western
regions where more than 50% of the under-construction capacity is
located. Although the transmission operator, Gas Transmission
Company Limited (GTCL), has set elaborate plans to expand the grid
network, no physical progress has happened to date. Fast-track
development of the interconnector and truck pipelines is required
to realize this incremental gas demand. An alternative solution is
to pursue a regasification terminal in Payra port or importing
piped gas through India.
However, infrastructure progress and legal approvals from the
Bangladesh government have been slow, which may hinder these
proposed developments. Should infrastructure fail to be developed
on time, there is a risk that the gas-fired power plants that are
being built will be stranded.
Bangladesh gas demand is localized and is being catered to by
the different regional distribution companies. In this
presentation, we will delve into the regional demand catered by the
different gas distribution companies and also look at the
installation of new gas-fired plants and associated pipelines to
understand the future gas demand centers and infrastructure
requirements.
Speakers:
Pratim Bhattacharjee, Senior Research Analyst, Climate &
Sustainability
