Reforms to boost investor confidence, attract FDI: Excelerate Energy CEO

The proposed reforms by the interim government to enhance transparency, accountability, and institutional efficiency in public administration, the financial sector, and public procurement are expected to boost business confidence and attract foreign direct investment in Bangladesh, said Steven Kobos, president and CEO of Excelerate Energy.

"I sense a renewed opportunity here, I can feel the sense of hope in the country at present," he said in an interview with The Business Standard during his visit to Dhaka last month.

The CEO of New York Stock Exchange-listed Excelerate Energy, a global leader in the liquefied natural gas (LNG) industry, said he will be discussing Bangladesh with colleagues from other US companies seeking investment opportunities around the globe.

"There are some challenging circumstances here now. But, if the reforms are made, I am confident that this would be a good environment for American businesses to deploy capital," said Kobos, who also chairs the board of the US-Bangladesh Business Council of the US Chamber of Commerce.

Excelerate Energy deployed two of its floating storage regasification units (FSRU) in Bangladesh, flowing into 1.1 billion cubic feet of gas a day which is 34% of the national consumption right now.

If the government wants, Excelerate assumes, the volume may rise to 2.1 billion cubic natural feet a day by the next five years, which means an additional 10 million tonnes of LNG a year.

In the debate over LNG dependency, Kobos said that Bangladesh should maximise the use of its own resources. However, LNG could play a critical role in supporting energy security until new gas extraction, as offshore drilling requires time.

LNG played a big difference in the energy landscape during disruptions and scarcity and the Ukraine war made it clear in 2022.

"I am excited about our work in providing energy security to customer counties," he said while explaining the flexibility of the transportable fuel option emerging as more crucial for economies.

LNG infrastructure can be redeployed to other markets as soon as a country says goodbye to LNG, Kobos said, adding that there are some 50 FSRUs in the world and with 20% share Excelerate leads the global market.

"I sense a renewed opportunity here, I can feel the sense of hope in the country at present."

Steven Kobos, President and CEO, Excelerate Energy

For instance, he said, Argentina still needs one of the two deployed Excelerate FSRUs after its big gas discovery at its South and the other one has already been redeployed to Finland.

Not only scarcity, but LNG is also an important part of the energy redundancy plan of nations, according to Steven Kobos.

Abu Dhabi is an example, he said, adding, "They don't use ours. But our assets still stand by there in case their nuclear or solar supply goes off."

Brazil, which had 70% dependency on hydroelectricity from their dams, still relied on Excelerate's FSRUs and in 2021 when the dams were going down and down due to the drought, the reliance paid off, said Kobos.

"The beauty of LNG is it offers quick solutions to energy problems, they can standby as part of a redundancy plan for energy security and in case of no demand ultimately, the assets can be redeployed to somewhere else and the flexibility is unique," said Kobos.

One FSRU alone in Karachi moved 5.25 million tonnes of LNG to Pakistan last year, he said, adding an FSRU alone can handle 1.25%-1.5% of the current global production.

About his global energy market outlook, Steven Kobos said that markets are not fully predictable as many uncertainties always remain there and better countries prepare for any situation.

"Who would have predicted the 2022 situation when Europe, for its energy security, was grabbing every molecule of gas at any price and the price shot four to five times suddenly?" he said.

However, the global LNG market came down to near its long-term average and Kobos believes it is a good time to secure LNG contracts for both the long and short terms.

LNG is not expensive if a country has the right infrastructure and secures supply deals for terms long enough, he said.

Starting from office executives to the technical men and women working at the FSRUs and the service boats, Excelerate created over a hundred good-paying jobs here without any legal requirement for hiring locals, as they are "incredibly talented and hardworking," according to Kobos.

"We are proud to be a reliable energy partner having a critical role in the Bangladesh economy as energy allows all the hardworking Bangladeshis to be empowered to produce, and export things to earn foreign currency," he said.

About the investment potential of Bangladesh, he said, "We respect the interim government vision as we think it will lead to an improved business climate of certainty, respect for contracts alongside that for the ability to move capital- together attracting more investments."

"It takes a long time to build reputations, and it is easy to damage reputations whether it is a company, person or an economy. Bangladesh just has to keep its slow steady efforts of good performance, because businessmen like predictability and it is not established in a matter of days," he said.  

"We are ready to invest here as long as Bangladesh needs us," Kobos added.