POST TIME: 3 September, 2018 00:00 00 AM
BERC waiting for NBR order to raise gas price

BERC waiting for NBR order to raise gas price

The Bangladesh Energy Regulatory Commission-BERC will move to increase the gas price after having a SRO (Statutory Regulatory Order) to be issued by National Revenue Board (NBR) describing withdrawal of taxes on Liquefied Natural Gas-LNG. “We are ready to adjust the gas prices as imported LNG was injected into the national grid before the Eid-ul-Azha. But without any SRO of the NBR we cannot take any decision,” said a member of the BERC .

“We will take a decision on the costing of mixed gas (local and imported). So, without any SRO, we cannot calculate the real cost of gas to the customers,” the BERC official, justifying the need for an SRO. Without detailing the issue, Petrobangla Chairman Abul Mansur Md Faizullah told the Independent that they were waiting for the SRO.

Sources said that the NBR Chairman was in Saudi Arabia to perform Hajj and was expected to take a decision after his return to Dhaka.

NBR sources said the decision would be taken in consultation with the finance ministry .

“We hope by this month (September) the entire process would be completed,” said a BERC official.

Perobangla, the country’s oil and gas corporation has to pay 40 per cent supplementary duty, 15 per cent VAT, 3 per cent AIT tax and other taxes on importing LNG, making costly. Recently, the prime minister instructed the NBR to withdraw all taxes on LNG imports.

With the finalization of the import of costly LNG a few months back, all gas distribution companies applied to the BERC for clearance to increase gas prices by up to 70 per cent. BERC is believed to have completed process of announcing the new rate.

The government official said the imported LNG costs Tk 26.50 per unit, whereas Petrobangla was selling at Tk 7.36 per unit.

Right now Petrobangla is supplying more than 100MMCF of gas per day and, by December, the supply volume would be 500 MMCF of gas per day, when the mix price (local and imported ) would be Tk 9.69.

“We have been watching the situation and after a few days will supply gas to new

industries when LNG stocks become adequate,” said an official of Petrobangla. Titas Gas Transmission and Distribution Company Ltd (TGTDCL), Bakhrabad Gas Distribution Company Ltd (BGDCL), Jalalabad Gas Transmission and Distribution Company Ltd (JGTDCL), and Karnaphuli Gas Distribution Company Ltd (KGDCL) in their common proposal sought the average natural gas tariff to be raised to Tk 12.95 per cubic metre from the existing Tk 7.39.

They wanted to raise the tariff for gas-fired power plants to Tk 10 per cubic metre from the existing Tk 3.16, for fertiliser factories to Tk 12.80 per cubic metre from the existing Tk 2.17.

The price of compressed natural gas (CNG) in the filling stations has been proposed to be hiked to Tk 48 per cubic metre from the existing Tk 40.

For the industrial sector, natural gas tariff, as sought by the distributors, is Tk 15 per cubic metre in place of the existing Tk 7.76. For gas-fired captive power plants, the tariff sought is to hit Tk 16 per cubic metre from the existing Tk 9.62.

Gas tariff for tea gardens has been proposed to be fixed at Tk 12.80 per cu m from the existing Tk 7.42. But they did not want any increase for house hold customers. The regulatory commission had on March 1, 2017 raised the natural gas tariff by 22.70 per cent for all types of consumers.