Bangladesh's Summit Power International said on Tuesday it signed a memorandum of understanding with Japan's Mitsubishi Corp and subsidiary Diamond Gas International to develop a $3 billion LNG-to-power project.
Under the MoU, subsidiary Summit Corp, group company Summit Holdings and the Japanese firms agreed to develop an integrated liquefied natural gas (LNG) onshore receiving terminal with regasification capacity of up to 1,500 million cubic feet per day (mmcfd) at Matarbari, Moheskhali in the Bay of Bengal.
They also agreed to develop two units of 1,200 megawatt (MW) gas turbine combined cycle power projects, relevant high voltage transmission lines and the import of LNG.
"This MoU will help Summit Power International support Bangladesh's fast-growing energy, power and technology needs," said Muhammed Aziz Khan, the chairman of Summit Power International.
"The two groups are well-positioned to uniquely benefit from opportunities arising from the Bangladesh government's move to raise LNG imports to meet the country's domestic natural gas shortfall and expand the country's power generation capacity."
Summit Power is the largest independent power producer in Bangladesh, representing about 21 percent of the country's private power market last year.
Summit Power is set to be the first Bangladeshi firm to list in the Singapore Exchange Ltd (SGX) by April, as it seeks to raise funds to invest in assets across Asia.
With up to 30 percent of the over 160 million people in Bangladesh lacking access to electricity, Summit hopes to invest in projects to meet that expected increase in demand, Khan told Reuters in February.
Bangladesh will require about 7 million tonnes of LNG by 2022 and similar volumes of coal by 2024, Khan had said.
Diamond Gas International is a wholly-owned LNG sales subsidiary that Mitsubishi Corp established in Singapore. (Reporting by Jessica Jaganathan; Editing by Subhranshu Sahu)