The project will be built with an investment of about $500m.

After signing of the final contract, Summit LNG Terminal Company, a unit of Summit Group, will develop the floating facilities in 18 months, The Financial Express.

The floating terminal will have a capacity to supply 500 million cubic feet of natural gas daily.

Summit will hand over the facilities to Bangladesh’s state oil firm after the completion of a 15-year operational period.

Under the deal, the government’s petroleum agency will pay $0.45 per 1,000 cubic feet of natural gas.

Summit Group Chairman Muhammed Aziz Khan was quoted by the publication as saying: “We want to ensure constant supply of primary energy for the country by implementing this project.”

Khan said that LNG will be “quickest and cost effective to meet the primary fuel demand as the current supply of gas will start falling in 2018.”

He added that the terminal will assist the company to develop a large gas-based power plant, with a production capacity of 600MW of electricity.

The project will be jointly developed by Summit with US-based General Electric (GE) as equity investment partner.

The contract signed with Summit is third LNG-related deal for the government till date.

In December, Petrobangla signed an initial agreement with India's energy firm Petronet to build an LNG re-gasification terminal on Kutubdia Island and a pipeline, Press Trust of India reported.

The contract secured by Petronet is estimated to cost of $950m.