Bangladesh Gas Crisis Worsens as FSRU Fire Exposes Government Blunders

Bangladesh is facing one of its most severe gas supply crises in recent memory. Over 2,500 factories and industrial establishments have shut down across the country, forcing thousands of workers to lose their jobs.

The crisis has been exacerbated by a fire at a floating storage and regasification unit (FSRU) operated by Excelerate Energy on July 21, which damaged its power-control and instrumentation cables. As a result, gas supplied through imported liquefied natural gas (LNG) fell from approximately 1,050 million cubic feet per day to only 500 million cubic feet.

The country's daily demand for gas is around 3,800 million cubic feet. With the Excelerate terminal out of service, Bangladesh is receiving barely 2,100 million cubic feet, leaving it with little more than half the gas it needs. The crisis has also disrupted electricity generation and intensified load shedding.

The Awami League government had introduced LNG imports to address the growing gap between supply and demand. However, the unelected interim administration cancelled a deal for a third FSRU in October 2024, which would have added another 600 million cubic feet of daily regasification capacity. The government then cancelled an LNG import agreement with Summit Group in September 2025, citing the absence of a third FSRU as a reason.

The decision to cancel the infrastructure required to process additional LNG removed the reserve capacity Bangladesh urgently needed. Had that terminal been completed according to the original schedule, the shutdown of one unit would not have pushed the entire country into such a severe emergency.