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18 February, 2018 00:00 00 AM
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LNG import starts from April

Gas prices to ‘double’

SHAHED SIDDIQUE
Gas prices to ‘double’

Before importing liquefied petroleum gas (LNG) from April this year, Petrobangla has sent a letter to the biggest customers of power and fertiliser plants, indicating that the gas price is going to be doubled. Sources said Petrobangla was working to finalise the gas price hike formula and would forward it to the Bangladesh Energy Regulatory Commission (BERC). Petrobangla Chairman Abul Mansur Md Faizullah told the Independent: "We've have issued a letter to the Bangladesh Power Development Board (BPDB) and the Bangladesh Chemical Industries Corporation (BCIC) so that they can prepare a budget for gas bill. It's necessary to increase the gas prices for all consumers as soon as possible, since the imported gas will be injected in April.” He, however, could not say exactly how much costlier gas will be and from when the new prices will come into effect. “We cannot say right at the moment how much costlier gas will be. It mainly lies on the BERC, which takes into consideration the costing before fixing any new rate.”

Sources in Petrobangla and the Energy Division said the gas prices would go up by at least 100 per cent with the injection of the imported LNG to the national grid, and the government will have to give subsidy of billions of dollars to keep it under the reach of the mass.

In a letter last week, Petrobangla urged the BPDB and the BCIC to manage enough funds for a considerable hike in gas prices, they said. The average cost of per unit of gas is Tk 7.34, but it will be Tk 13 per unit after the imported gas arrives. The power sector alone consumes 41 per cent of the total gas production. But it pays only Tk 3.16 per unit. Fertiliser factories pay only Tk 2.72 per unit for their importance to the agriculture sector. “We know that LNG is going to cost more. We're preparing for that,” BPDB Chairman Khaled Mahmud told this correspondent last week.

BCIC Chairman Shah Mohammed Aminul Haque said: “I have been informed about Petrobangla's letter. But, fertilisers should be sold at reasonable prices to achieve the Sustainable Development Goal (SDG). Let's see what happens with the issue in future.”

The fertiliser sector consumes 316mmcf gas per day, while the power sector needs 1,000mmcf gas. Petrobangla currently produces 2,691mmcf gas every day. Government officials said the country has a deficit of 700-800mmcf gas per day. The first consignment of LNG will reach Maheshkhali on April 26. Sources said the LNG price is up in the international market and the price of per thousand cubic feet is more than eight dollars that means that the government will have to spend more than 1.5 billion dollars annually for importing 1.87 million tonne gas. At the yearend, Petrobangla will start importing another 250mmcf LNG per day. The government last increased the gas price on February 22, last year, in two phases. The first phase came into effect in March 2017 when the charge for a single burner stove was increased to Tk 750 from Tk 600 and for double burner stove to Tk 800 from Tk 650.

The second phase was supposed to come into effect from June the same year and the monthly charge for a single burner stove was fixed at Tk 900 and double burner stove at Tk 950. The second phase hike could not be implemented because of a High Court order.

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Published by the Editor on behalf of Independent Publications Limited at Media Printers, 446/H, Tejgaon I/A, Dhaka-1215.
Editorial, News & Commercial Offices : Beximco Media Complex, 149-150 Tejgaon I/A, Dhaka-1208, Bangladesh. GPO Box No. 934, Dhaka-1000.

Editor : M. Shamsur Rahman
Published by the Editor on behalf of Independent Publications Limited at Media Printers, 446/H, Tejgaon I/A, Dhaka-1215.
Editorial, News & Commercial Offices : Beximco Media Complex, 149-150 Tejgaon I/A, Dhaka-1208, Bangladesh. GPO Box No. 934, Dhaka-1000.

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