The Asian Development Bank has approved $583 million in debt financing and partial risk guarantees for the Reliance Bangladesh Liquified Natural Gas (LNG) and Power Project.
The project, which is composed of a power generation facility in Meghnaghat and an LNG terminal near Cox Bazar’s Kutubdia, ADB said in a statement. The total cost of the project is about $1 billion.
“ADB’s partnership with Reliance Power will help Bangladesh scale up its energy infrastructure to sustain and support the country’s economic growth,” said Michael Barrow, director general of ADB’s Private Sector Operations Department.
“ADB’s role as a direct lender and guarantee provider will enable Reliance Power to mobilise much-needed long-term debt financing and help attract new lenders to Bangladesh.”
The new LNG import facility will allow existing gas-based technology to remain viable amid rising demand for gas and pressure on domestic reserves, ADB said.
The ADB support will help to produce approximately 750 MW of the 3,000 MW power capacity Reliance Power is looking to create in Bangladesh. The energy will be sold to the Bangladesh Power Development Board under a long-term power purchase agreement.
“Reliance Power has achieved a major and important milestone of approval of financing for its landmark project in Bangladesh. This is an important step in helping Bangladesh achieve energy security,” said Venugopala Rao, CEO of Reliance Power, India’s leading private power generator.
“ADB’s leadership in financing will help us to develop this clean and reliable LNG-based power project in Bangladesh.”