International Finance Corporation (IFC), a member of the World Bank Group, and Excelerate Energy Bangladesh, have secured a loan for Moheshkhali Floating LNG project in Bangladesh.
Located offshore Moheshkhali island in the Bay of Bengal, the project is being developed by IFC and Excelerate Energy. The facility, which will involve an investment of $179.5m, is touted to be Bangladesh's first liquefied natural gas (LNG) import terminal.
IFC has arranged a debt financing package of $125.7m, which includes a loan of $32.8m from its own account. The rest has been procured from UK-led CDC Group, Germany’s DEG, Dutch-lead Entrepreneurial Development Bank (FMO) and Japan International Cooperation Agency (JICA).
The equity for the project had been tied up earlier with IFC coming in with a contribution of $10.8m and Excelerate's equity amount of $43.1m.
The financing will support the timely construction and installation of the fixed infrastructure required for the project.
Once the terminal is completed, it will enable Petrobangla, the state-owned energy company, to increase natural gas supply in the country by up to 20%, sufficient to support up to 3,000 MW of power generation capacity.
Construction of the terminal will start in the fourth quarter of 2017 with completion scheduled for mid-2018.
Excelerate CFO Nick Bedford said: “Our partnership with IFC has been essential to the development of this project. IFC has demonstrated its commitment to bringing new energy to Bangladesh with the execution of these agreements.
“Excelerate takes great pride in helping bring sustainable energy solutions to countries with high energy demand, and we expect this project to have a great impact on the wider Bangladeshi economy."