LPG means liquefied petroleum gas consisting of mainly propane (C3 H8) and butane (C4 H10) in various mixtures. LPG is normally produced by petroleum refining. In Bangladesh, we get LPG from Eastern Refinery Ltd, Chittagong and also from NGL extracted from MSTE plant kailashtilla gas ltd of SGFL.
LPG is used for the following purpose:
1) Domestic cooking fuel
2) Automotive fuel
3) Power generation
4) Central heating and cooling
5) Metal cutting
6) Refrigerant (propane)
7) Camping stoves (Butane) etc
8) Aerosol
The growth of LPG industry in Bangladesh has been driven by the increasing demand of LPG in households, commercial & industrial sectors as a replacement of traditional fuel (wood, kerosene, Cowdung & Others).
The western countries started using LPG as an automotive fuel in 1970s and 1980s. In USA and Canada, LPG is most commonly used as transportation fuel, behind gasoline & diesel as because:
1) LPG can be used as replacement of CNG
2) Clearer and cheaper liquid fuel
3) Investment cost for infrastructure is less
4) Power deliverance is almost equal to other liquid fuels
As per the announcement of the Mineral Resources Division, the natural gas will not be used for household cooking purpose in future. LPG ultimately will replace natural gas in near future because the natural gas reserve is going to be exhausted if some more new gas fields are not discovered soon in onshore or in offshore Bangladesh.
LPG has already become very popular as an alternative fuel in Bangladesh. Among the 14 nos of operators, the top LPG operators like JSJVL (Jamuna Gas), Omera and Bashundhara started their LPG activities in such a manner that the people started to believe that our only way out is to use of LPG as a common & cheaper fuel, which can be easily carried and made readily available in the door steps of the users.
Presently, the demand of LPG is growing very fast in Bangladesh. The growth of local LPG based industries is also very significant. The players who are having LPG business are also having healthy competition among themselves. All LPG operators are now investing huge amount of funds for installation of the plant, importing LPG, importing & manufacturing LPG cylinders.
We are observing the rapid growth of LPG activities throughout the country. The main private operators of LPG in Bangladesh are:
1) JSJVL (Jamuna Gas) 2) Bashundhara 3) Omera 4) TOTALGAZ 5) BM Energy 6) Laugfs Gas 7) INDEX LP 8) Universal LP Gas 9) TK Gas Service 10) Bin Habib Gas 11) G, Gas
Presently, the total import of LPG by the private players in Bangladesh is around 700,000 MT/year. JSJVL imports 120,000 MT per year through its own terminal at Mongla port. The volume of LPG imported by the LPG operators has increased quite significantly. All operators are also increasing their LPG storage capacity to cope up with the present demand in the market.
Our sister concern JB Cylinder Ltd produces more than 2,000 cylinders per day, at its Bogra factory. Besides, this JSJVL also regularly imports LPG cylinders from Thailand to meet the present demand.
To keep our Jetty at Mongla port fully operational, our sister concern JB Dredger Ltd has already purchased an 18” cutter suction dredger from Netherlands in the year 2016. This dredger also helps to maintain the optimum draft of the other LPG operator’s terminals located at Mongla Port.
JSJVL has already started vigorously its LPG operations throughout the country so that it can remain within the top two operators in Bangladesh.
Expansion of storage and filling capacity by JSJVL is a continuous process. By 2021, annual import & sales capacity is expected to exceed 300,000 MT/per year.
Most of the leading LPG operators in Bangladesh have already applied to the BEZA Mirsarai, Chittagong for allotment of land for setting up more LPG-oriented industries.
Once the LPG filled cylinders will be available in the remote villages and we can ensure door-to-door supply of LPG-filled cylinders at a reasonable rate, then the use of LPG will be increasing very fast.
Presently, the government of Bangladesh is encouraging setting up of LPG filling stations by the side of all the main highways and also in the cities & towns which will include automobile conversion workshop. JSJVL received permission from the government to setup 200 LPG filling stations and 50 workshops.
Under the above circumstance, I would request the authorities to minimize the customs duty, tax and VAT for imports related to the LPG business.
Mohammad Belayet Hossain;
Chairman
Jamuna Specetech Joint Venture Ltd.
