Bangladesh is moving towards securing a long-term liquefied natural gas (LNG) supply agreement with Saudi oil giant Aramco, aiming to reduce reliance on volatile spot markets, officials said.

Under the proposed deal, Bangladesh may initially import around 1.0 million tonnes per year (MTPA) of LNG, with deliveries expected to begin this year.

The development follows a recent agreement between Bangladesh and US-based Argent LLC for LNG supply, highlighting efforts to address the country’s growing energy demand.

Muhammad Fouzul Kabir Khan, an adviser to the Ministry of Power, Energy, and Mineral Resources, said Aramco has formally expressed its intent to supply LNG through a proposal to the Energy and Mineral Resources Division (EMRD). The volume and pricing will be determined during negotiations.

Another government adviser, Syeda Rizwana Hasan, stated that Aramco had agreed to offer LNG at a price lower than the current market rate, which could ease Bangladesh’s financial strain amid rising spot LNG prices and payment backlogs.

Platts JKM, the benchmark for LNG in Northeast Asia, was assessed at $13.21 per million British thermal units (MMBtu) on March 5. However, Bangladesh recently purchased a spot LNG cargo at $16.43 per MMBtu due to delayed payments.

Meanwhile, Rupantarita Prakritik Gas Company Ltd (RPGCL) has shortlisted Aramco’s trading arm, Aramco Trading Co (ATC), for potential LNG spot market supply.