In September, Bangladesh made its highest-ever external payment in the energy sector, settling $419.90 million in dues amid what officials describe as improved financial management and ongoing reforms.
The milestone was reached last Monday when state-owned Petrobangla cleared a $15 million overdue LNG bill to Qatar, according to officials.
“We have paid $352 million for 11 LNG cargoes including processing costs, $37 million to Chevron Bangladesh, and $30 million to the International Islamic Trade Finance Corporation (ITFC) to repay a loan with interest,” A K M Mizanur Rahman, Petrobangla’s Director (Finance), told Just Energy News.
Petrobangla expects external payments to surpass $500 million this month, as three additional LNG cargoes are set to be imported to meet rising demand against declining domestic production. However, officials anticipate the pressure will ease between November 2025 and March 2026.
According to official sources, the single-month bills in August amounted to about $350 million
In April 2025, Petrobangla cleared all overdue external liabilities, two months ahead of the June 30 deadline. At the beginning of the interim government’s tenure, overdue liabilities stood at $737.46 million (Tk8,702.03 crore). Officials confirmed that currently, Petrobangla has no outstanding dues.
Energy and Mineral Resources Division Secretary Mohammed Saiful Islam said the government has successfully cut the LNG import premium from about 65 cents per MMBtu to just 15 cents, easing import costs.
“We are trying to bring down the premium further to 10 cents under our reform programme,” he said.
Petrobangla credited its achievement to coordinated efforts involving the Energy Division, affiliated agencies, and guidance from the energy adviser.
To improve payment capacity, Petrobangla introduced several measures including setting monthly recovery targets for gas companies, improving end-user collections, holding regular inter-ministerial meetings to recover dues from the power and fertiliser sectors, and expanding the number of banks issuing Standby Letters of Credit (SBLCs) for LNG imports.
Bangladesh Bank also extended special support to facilitate foreign currency payments, while a Tk2,000 crore loan from Bangladesh Petroleum Corporation (BPC) eased foreign debt repayments.
Between March and April 2025, Petrobangla cleared a combined $1,445.41 million (Tk17,857.86 crore), eliminating all overdue liabilities.
Since entering the global liquefied natural gas (LNG) market in 2018, Bangladesh has spent more than $17.6 billion to import 31.61 million tonnes of LNG, according to data from Rupantarita Prakritik Gas Company Ltd (RPGCL), a Petrobangla subsidiary.
Import volumes have increased from 0.67 million tonnes in 2018 to 5.80 million tonnes in 2024. The corresponding import bill has also ballooned, with $3.53 billion spent in 2022 and $3.54 billion in 2024.
The mounting fiscal burden stems from shrinking domestic production, which has fallen from 2,694 mmcfd in FY2017-18 to around 1,800 mmcfd in recent months. This decline underscores Bangladesh’s growing dependence on costly imports amid global price volatility and rising domestic demand across industries, households, and the power sector.
Reforms underway
Looking forward, Petrobangla is pursuing structural reforms to strengthen energy security and reduce import dependency.
These include: boosting domestic gas production through exploration and development, reducing system losses in gas transmission and distribution, securing long-term LNG contracts from 2026, seeking VAT exemptions on LNG imports and consumer-level gas supply, and requesting tax relief from the National Board of Revenue (NBR)
Officials said these initiatives aim to ease the financial burden of imports while building resilience in Bangladesh’s energy sector.