State-run energy company Petrobangla has finalised a consortium of local and foreign banks to finance its future imports of liquefied natural gas (LNG), supported by a repayment guarantee from the World Bank.

Following a competitive tender process, Petrobangla selected three international banks—Germany’s Deutsche Bank, the Development Bank of Singapore, and Standard Chartered—and five local banks: Prime Bank PLC, Eastern Bank PLC, Dutch-Bangla Bank, City Bank PLC, and BRAC Bank PLC.

The banks were chosen from among 31 individual bidders and 11 consortium proposals.

The selected banks will provide financial instruments, including a $200 million stand-by letter of credit (SBLC) valid for up to 12 months to secure payments to long-term LNG suppliers. Additionally, they will issue a $50 million SBLC for spot market purchases and a $100 million short-term credit line to cover payment obligations.

Negotiations are currently underway to finalise the agreements. The financing package follows the World Bank’s approval of a $350 million guarantee in June under the Energy Sector Security Enhancement Project. The guarantee, issued through the International Development Association (IDA), is designed to mobilise up to $2.1 billion in private capital over seven years to support Bangladesh’s LNG imports.

This is the first time the World Bank has extended a guarantee facility for Bangladesh’s LNG imports. LNG now accounts for over 25 percent of Bangladesh’s gas consumption, costing approximately $4.5 billion annually.

The World Bank’s guarantee is expected to improve Petrobangla’s creditworthiness, enabling it to secure LNG cargoes despite Bangladesh’s ongoing foreign currency shortages. The IDA guarantee will cover up to $350 million in principal and accrued interest on bank loans and SBLC draws but will exclude penalties and default interest.

According to the World Bank, about 42 percent of Bangladesh’s gas is used by the power sector, making secure LNG supply critical for maintaining stable electricity generation and supporting industrial and domestic users.

Petrobangla data shows Bangladesh imported 30.64 million tonnes of LNG between 2018 and May 2025. With domestic gas reserves declining, the country may require up to 30 million tonnes of LNG annually by 2041 to meet projected demand.

A study by Danish consultancy Ramboll and partners has warned that without new discoveries, Bangladesh’s existing gas reserves could be depleted by 2038. Petrobangla projects daily gas demand will reach 8 billion cubic feet by 2041, compared with the current supply of about 2.87 billion cubic feet per day.