The energy-rich Kingdom of Saudi Arabia will be investing USD 2.5 billion in the Bangladeshi power sector to set up a 3,600-megawatt power plant.
Saudi Arabia-based company ACWA Power signed on Thursday a memorandum of understanding (MoU) with state-run Bangladesh Power Development Board to build a natural gas or liquefied natural gas-fired combined cycle power plant in this regard.
BPDB chairman Khaled Mahmood and ACWA Power’s chairman Mohammad Abunayyan inked the MoU at Dhaka. Prime Minister’s adviser on private industry and investment Salman F Rahman attended the signing ceremony as the chief guest while state minister for the Ministry of Power, Energy and Mineral Resources Nasrul Hamid as the special guest.
The Saudi firm is eager to invest $2.5 billion in the Regasified liquefied Natural Gas or RLNG-based combined cycle power plant. ACWA expects to start the investment within 2020, according to its Chairman Abunayyan.
The study on technical and financial feasibilities of the project will start ‘shortly’ and a power purchase agreement be struck within six months.
ACWA will also co-build a $500 million LNG terminal in Bangladesh with Saudi oil giant Aramco, the Chairman confirmed.
The proposed power plant might be set up at Moheshkhali or any other suitable location in the country and its capacity would be determined after a feasibility study on power demand and system requirement.
There might be a joint venture between BPDB and ACWA or the Saudi company itself might implement it as independent power producers’ plant under build, own and operate basis.
Mr Hamid stressed that the country will require investment of around US$30 billion within next few years to achieve the goals of Vision 2041. He also claimed that the country’s power sector already bagged investment worth around $22 billion over the past five years which helped augmenting the country’s overall generation capacity from around 3,000 megawatt to around 20,000 MW.
Of the investment, Chinese firms already invested around $7.0 billion in last several years. Also, around $20 billion investment from China is in the pipeline.
Japan has made investment worth around $6.0 billion in the form of debt and investment. Japan is also investing in a big way to develop the country’s first-ever deep-sea energy port by 2024-25. Singapore’s Sembcorp invested around $500 million.
Chevron is the lion investor in hydrocarbon sector while ExxonMobil, Shell is coming up for further investments, the state minister said.
Earlier, another Saudi Arabian firm Alfanar inked a separate MoU with another state-owned company Electricity Generation Company of Bangladesh at Sonagazi in Feni district to implement a 100MW solar power plant.
Addressing the deal signing, ACWA Chairman Mohammad Abunayaan said that the power plant will be most economic and efficient one.