DHAKA, Dec 29, 2016 (BSS) - The government today signed with the Asian Development Bank (ADB) a $167 million loan agreement for financing a project to improve infrastructure and operational efficiency of the country's gas sector.
The Asian Infrastructure Development Bank (AIIB) is expected to co-finance the project with an additional $60 million. The total cost of the project is $453 million, of which the government will finance $226 million from its own source.
Last month, the ADB approved the loan amount to help promote sustainable economic growth and reduce poverty in Bangladesh by improving production efficiency at a key gas field north of the capital Dhaka and by expanding transmission infrastructure.
Senior Secretary of the Economic Relations Division (ERD) Mohammad Mejbahuddin and ADB Country Director Kazuhiko Higuchi signed the loan document on-behalf of their respective sides.
At the event, the state-owned Bangladesh Gas Transmission Company Limited (BGTCL) and Bangladesh Gas Fields Company Limited (BGFCL) also inked two project loan deals with the ADB.
Under the agreement, the ADB will finance the "Natural Gas Infrastructure and Efficiency Improvement Project".
The project aims to improve efficiency in natural gas production by installing seven wellhead gas compressors at Titas gas field and expand natural gas transmission pipeline capacity by constructing a 181-kilometer, 36-inch parallel gas transmission pipeline from Chittagong through Feni to Bakhrabad.
Chittagong area sometimes suffers from a gas supply shortfall due to full capacity attainment of the existing 175 km, 24-inch Bakhrabad-Chittagong gas transmission pipeline.
It is expected that increasing gas production at Titas gas field and installing the new gas transmission pipeline will help improve gas supply to the country's prime port city and its adjoining areas.
Source: Bangladesh Sangbad Sangstha (BSS)