The domestic conglomerate Summit Group and Bangladesh have ended their agreement for the construction of a second floating liquefied natural gas terminal in the nation, according to the business.

Summit received a termination notice for the development on Monday evening, it said in a statement to Reuters sent late on Monday.

It was projected that the third LNG import facility in Bangladesh will have opened for business by the second quarter of 2026.

Summit operates one of Bangladesh's two LNG import ports.

The cancellation comes after a government commission recommended earlier this month to nullify the contract. The contract was signed in March in accordance with a statute that was supposed to guarantee the nation's uninterrupted power supply, but critics claim the signing procedure was opaque.

According to Summit's statement, it has a track record of responsibly and transparently creating long-term infrastructure projects in Bangladesh.

"We believe this is unjustified and will appeal for review," the company said.

An official from state-owned energy company Petrobangla, who asked to remain unidentified because they are not authorised to speak to the media, confirmed the Summit deal had been cancelled.

The cancellation of Summit's contract will also end a 15-year LNG supply agreement tied to the terminal's construction, the Petrobangla official said.

Muhammad Fouzul Kabir Khan, the power and energy adviser to the government, did not immediately reply when contacted for a response on the cancellation.

The interim government of Bangladesh, headed by Nobel Peace Prize winner Muhammad Yunus, expressed apprehensions regarding the financial risks linked to agreements such as the one with Summit, following the fall of Prime Minister Sheikh Hasina due to widespread demonstrations.

Instead of holding a private contract, Petrobangla started holding open tenders last month to purchase spot LNG cargoes from the global market.