Bangladesh Gas Crisis Deepens as Summit LNG Shuts

 

Bangladesh Gas Crisis Deepens as Summit LNG Terminal Shuts Amid Rough Weather

Bangladesh’s gas crisis has intensified after the Summit LNG terminal stopped supplying gas amid adverse weather in the Bay of Bengal, putting further pressure on an already strained energy system. The disruption began on Thursday, August 13, when rough seas prevented an LNG cargo from being connected to the terminal at Maheshkhali in Cox’s Bazar.

The timing is particularly difficult because Bangladesh was already dealing with a severe gas shortage following an earlier disruption at another floating LNG terminal. With Summit’s facility now offline, gas availability has fallen sharply, affecting power generation, industries, households and transport.

What Happened at Summit’s LNG Terminal?

Summit’s floating storage and regasification unit (FSRU) stopped supplying gas at around 5pm on August 13, according to reports. Rough weather in the Bay of Bengal prevented an LNG cargo from being connected to the terminal, forcing the facility to suspend operations.

An FSRU is essentially a floating LNG facility that receives liquefied natural gas from ships, converts it back into gaseous form and sends that gas into the national pipeline network.

That makes Summit’s terminal an important part of Bangladesh’s energy infrastructure.

The latest shutdown is especially significant because the country has only two major floating LNG terminals at Maheshkhali. One was already operating below normal capacity following an earlier technical disruption.

Gas Supply Has Fallen Far Below Demand

The latest disruption has widened the gap between Bangladesh’s gas demand and available supply.

According to The Business Standard, national gas supply has fallen to around 1,900 million cubic feet per day, compared with demand of approximately 3,800 million cubic feet per day.

That means the country is receiving only about half of the gas it needs.

The problem is not entirely new. Bangladesh has faced a structural gas shortage for years, with domestic production unable to keep pace with demand. LNG imports were introduced to bridge part of that gap.

But the dependence on imported LNG also means that disruptions at floating terminals can quickly affect the wider economy.

Why the LNG Shutdown Is Affecting Electricity

The most immediate concern is electricity generation.

Bangladesh relies heavily on natural gas-fired power plants. When gas supplies fall, these plants cannot operate at their normal capacity.

That creates a direct chain reaction:

LNG disruption → lower gas supply → reduced power generation → electricity shortage → load shedding.

Reports indicate that load shedding, which had already been severe outside Dhaka, has now started affecting the capital as well.

The Daily Star reported that the worsening LNG shortage has further squeezed power generation, while authorities have limited options for quickly replacing the lost gas supply.

For households, this means the problem is no longer limited to low gas pressure. Electricity outages are becoming another visible consequence.

Dhaka Is Now Feeling the Pressure

The spread of load shedding into Dhaka is important because the capital is the country’s largest concentration of residential, commercial and service-sector activity.

Power cuts can disrupt:

• Offices and businesses
• Shops and restaurants
• Small manufacturing units
• Internet and telecommunications infrastructure
• Water-pumping systems
• Household appliances
• Commercial refrigeration

At the same time, households in several areas have already been experiencing weak gas pressure.

This creates an unusual double pressure on consumers: gas is difficult to obtain for cooking, while electricity supply is also becoming less reliable.

Industries Face a Bigger Economic Risk

The gas shortage is particularly serious for energy-intensive industries.

Manufacturing companies use natural gas either as a direct production input or to generate electricity through captive power systems. Lower gas pressure can therefore force factories to reduce operating hours or run below capacity.

Bangladesh’s textile, steel, ceramics, glass, fertiliser, chemical and other manufacturing industries are particularly sensitive to energy availability.

Earlier disruptions in LNG supply had already caused problems for factories and CNG stations across the country.

A prolonged shortage can increase production costs in two ways.

First, factories may produce less, reducing capacity utilisation and revenue. Second, companies that can switch to diesel or other liquid fuels may face higher energy costs.

For export-oriented manufacturers, this can become a competitiveness issue.

CNG Supply Could Also Remain Under Pressure

Bangladesh’s CNG transport sector is another area to watch.

The earlier LNG disruption resulted in long queues at CNG filling stations, with some stations temporarily unable to sell gas.

If the latest shortage persists, CNG availability could again become a major problem.

For drivers, the impact is straightforward: longer queues, less predictable fuel availability and potentially higher transportation costs.

For the broader economy, however, the consequences can extend into logistics and the movement of goods.

Why Bangladesh Is Vulnerable to LNG Disruptions

The current crisis exposes a deeper structural problem.

Bangladesh's domestic gas production has not been sufficient to meet national demand. The government has therefore increasingly relied on imported LNG to supplement domestic supplies.

The country’s two Maheshkhali FSRUs have a combined regasification capacity of roughly 1,100 million cubic feet per day under normal conditions.

Earlier in July, a technical problem at the Excelerate Energy-operated terminal cut gas supply by roughly 450 million cubic feet per day.

With that disruption still affecting the system, the shutdown of Summit’s terminal creates another major supply shock.

The situation demonstrates the concentration risk in Bangladesh’s LNG infrastructure: when one terminal experiences a serious problem, there is limited spare capacity to immediately compensate.

What Does This Mean for Bangladesh’s Economy?

The immediate impact is likely to be felt through electricity shortages and industrial disruptions.

If the situation lasts only a short period and LNG operations resume quickly, the economic impact could remain manageable.

The risk becomes much greater if the disruption continues.

A prolonged energy shortage could lead to:

• Lower factory utilisation
• Higher industrial fuel costs
• Reduced manufacturing output
• Higher operating expenses
• More electricity load shedding
• Transport disruptions
• Pressure on business margins
• Potential delays in production and exports

For investors and businesses, energy availability is therefore an important indicator of economic activity.

What Should Be Watched Next?

The next few days will be crucial.

The most important developments will be the restoration of Summit’s LNG operations, the arrival and connection of LNG cargoes, gas allocation to power plants and changes in electricity generation.

Investors and businesses should particularly monitor:

1. Summit LNG terminal operations
2. Weather conditions in the Bay of Bengal
3. Daily LNG regasification volumes
4. Gas supply to power plants
5. Load-shedding levels
6. CNG station availability
7. Industrial gas pressure
8. Government measures to manage the shortage

A recovery in LNG supply would ease pressure across several parts of the economy. But if the disruption coincides with continuing weakness at the other LNG terminal, Bangladesh could face a much more persistent energy crunch.

The Bigger Issue: Energy Security

The latest Summit disruption is more than a temporary weather-related inconvenience.

It highlights the importance of energy diversification for Bangladesh. LNG can help compensate for declining domestic gas production, but dependence on a small number of import and regasification facilities leaves the country vulnerable to technical failures, weather disruptions and international LNG-market risks.

Over the longer term, Bangladesh may need a combination of greater domestic gas exploration, stronger LNG infrastructure, diversified energy sources and improved power-sector flexibility.

For now, however, the priority is much more immediate: restoring gas supplies and preventing the shortage from causing deeper damage to electricity generation and industrial production.

Final Takeaway

Bangladesh’s gas crisis has entered a more difficult phase after Summit’s LNG terminal stopped supplying gas amid rough weather, while the country was already dealing with reduced LNG availability from an earlier terminal disruption. Gas supply has fallen far below national demand, increasing pressure on power generation and contributing to load shedding, including in Dhaka.

The key factor to watch now is how quickly Summit’s LNG operations can resume. If the interruption is brief, the system may gradually stabilise. If it persists, the effects could spread further through electricity, transport, households and energy-intensive industries.

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