26 offshore blocks opened for exploration; new floating and land-based LNG terminals planned
The government plans to drill 150 new oil and gas wells by 2030-31 and develop new LNG terminals as part of an ambitious drive to strengthen Bangladesh’s energy security and reduce the risk of supply disruptions.
Prime Minister Tarique Rahman disclosed the plans in parliament on Wednesday, saying the government is also seeking international investment to explore and develop oil and gas in 26 offshore blocks.
An international bidding round for the offshore blocks was launched on May 24, with the deadline for submitting bids set for November this year, he said.
The government has also initiated work on a new Bangladesh Onshore Model Production Sharing Contract (PSC) 2026 to attract international investment in onshore oil and gas exploration.
The prime minister outlined the government’s short- and long-term energy plans in response to separate questions from Sultana Ahmed, a member of parliament from reserved women’s seat-17, and Tajuddin Khan of Meherpur-1.
New LNG capacity
Responding to a question about the disruption caused by the temporary shutdown of an LNG terminal in July, which resulted in a daily gas shortfall of around 450 million cubic feet, Tarique said the government was taking measures to improve supply resilience.
The country currently has two floating LNG terminals capable of supplying an average of around 935 million cubic feet of gas a day, he said.
To increase emergency supply capacity, work is underway to establish a new floating LNG terminal at Kutubjom in Maheshkhali and a land-based LNG terminal at Matarbari.
The Kutubjom terminal is expected to start supplying re-gasified LNG in 2028, while the land-based terminal at Matarbari is targeted for operation by 2030.
The government is also assessing the feasibility of setting up another floating LNG terminal in the deep sea, considering suitable locations near Payra or Mongla ports or along the southwestern coast, according to the prime minister.
The move comes against the backdrop of recurring gas shortages that have disrupted industrial production and exposed the vulnerability of the country’s LNG-based gas supply system.
150 new wells by 2030-31
The government has set a target of drilling 150 new wells by 2030-31 to expand domestic gas exploration and production, Tarique said.
To identify new reserves, seismic surveys covering 4,500 line kilometres using 2D technology and 4,200 square kilometres using 3D technology are currently underway.
The government has also taken an initiative to bring gas from Bhola to the mainland in LNG form for supply to interested industries.
Planned industrial areas, including economic zones, export processing zones and BSCIC industrial estates, will receive priority under the initiative, he said.
Offshore exploration drive
The planned exploration of 26 offshore blocks marks a major push to tap Bangladesh’s largely underexplored maritime resources.
The government is seeking international companies for exploration and production, with the bidding process already underway.
At the same time, the proposed Onshore Model PSC 2026 is intended to create a more attractive framework for foreign investment in exploration on land.
Renewables to cut import dependence
The government is also seeking to reduce dependence on imported fuels by expanding renewable energy, particularly solar power.
Tarique said renewable energy had been identified as one of the government’s highest-priority sectors and that a National Renewable Energy Development Strategy for 2026-30 had been formulated.
The government has set a target of meeting at least 20 per cent of total electricity generation from renewable sources by 2030 and 30 per cent by 2040.
Solar power will receive the largest share of the planned expansion.
The government aims to generate 5,500MW from rooftop solar installations and another 4,500MW from large-scale, land-based solar projects by 2030.
A further 450–550MW is expected to come from wind power, waste-to-energy, hydropower, floating solar and agrivoltaics.
Incentives for rooftop solar
To encourage private investment and wider consumer participation, the government has also introduced incentives for rooftop solar systems.
Under a special pricing decision issued on September 1, the maximum generation cost for rooftop solar, including battery storage, has been set at Tk8 per unit.
Taking into account a 20 per cent profit margin and an 11.25 per cent premium, the price payable for surplus electricity supplied to the national grid has been fixed at Tk10.50 per unit.
Consumers who install rooftop solar systems by February 28, 2027, in accordance with the Net Metering Guideline 2025 will be eligible to sell surplus electricity at the Tk10.50 rate for three years, until February 28, 2030.
The government has also waived customs duty, regulatory duty, supplementary duty, advance tax and the additional 2 per cent advance income tax on imports of key renewable-energy equipment, including solar panels, inverters, specialised batteries and mounting structures.
The prime minister said a number of policy measures had also been introduced to facilitate public-private investment, including guidelines for PPP projects on government-owned land, the Private Investment Promotion Policy 2025, Renewable Energy Policy 2025 and the updated Net Metering Guideline 2025.
The government has additionally introduced a National Rooftop Solar Programme, a business model for waste-to-energy projects, an onshore wind guideline and a framework for carbon-credit processing as part of its broader transition towards a more diversified and sustainable energy system.