India’s Reliance Power has signed agreements with Bangladesh Power Development Board (BPDP) for phase 1 of 750 MW liquefied natural gas (LNG) combined cycle power project at Meghnaghat, near Dhaka in Bangladesh.
The company has signed a power purchase agreement (PPA) and implementation agreement (IA) for the project.
In May last year, the Government of Bangladesh has granted in-principle approval for the first phase of Reliance Power’s project in Bangladesh.
The investment outlay for the phase 1 of the project will be about $1bn, which is considered to be a major foreign direct investment (FDI) in Bangladesh.
At a business summit organised by the Confederation of Indian Industry (CII), the companies have exchanged the agreements in the presence of Prime Minister of Bangladesh, Sheikh Hasina.
Besides, Reliance Power has entered into a memorandum of understaning (MoU) with PetroBangla to set up 500 million standard cubic feet per day (mmscfd) LNG terminal at Kutubdia Island near Chittagong in Bangladesh.
The company said that it will execute the definitive agreements for setting up the LNG terminal with PetroBangla shortly.
It stated: “Reliance project will give a tremendous boost to the economic and industrial growth of Bangladesh and help to enhance the energy security with clean, green and reliable LNG based power.”
Asian Development Bank (ADB) and a consortium of lenders are considering to finance the project.
For the project, Reliance Power will install equipment procured previously for its 2,250MW combined cycle power project at Samalkot in Andhra Pradesh, India.
A part of the Reliance Group, Reliance Power is a major private sector power generation and coal resources company in India. With an operating capacity of 5,945MW, the company’s projects are based on coal, gas, hydro and renewable energy.