BM Energy starts setting up 100 auto-gas filling stations

Dhaka,  Thu,  21 September 2017
Published : 17 Jul 2017, 00:33:21 | Updated : 17 Jul 2017, 15:21:58
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BM Energy starts setting up 100 auto-gas filling stations

Use of LPG as auto fuel is on the rise
M Azizur Rahman
The number of LPG (liquefied petroleum gas) or auto-gas filling stations across the country is expected to increase tenfold to 120 by the end of 2017 boosted by favourable policy and mounting demand, industry insiders said.

The country's lone LP gas operator licence-holder -- BM Energy (BD) Ltd -- has started work on installing some 100 new auto-gas filling stations across the country by the yearend, Chief Executive Officer of BM Energy (BD) Ltd Mohammed Nurul Alam told the FE Sunday.

He said agreements have already been made with 25 franchise companies who will build at least 25 new auto-gas filling stations in different places across the country.

"Our firm will also build six new LPG filling stations soon," he said.

BM Energy, a joint venture (JV) privately-owned company of the Netherlands and Bangladesh, got the first and lone licence in Bangladesh in April under a new policy to install 400 LPG filling stations across the country.

Under the terms of the licence, the JV company has the authority to import, produce, storage, transport and supply of LPG to households, commercial and industrial clients through engaging dealers or franchises.

The firm will also be able to set up LPG terminals, auto-gas conversion plants and LPG bottling plants.

It would also be able to export bottled LPG or LPG in bulk quantity after attaining no-objection certificate (NOC) from the Energy and Mineral Resources Division (EMRD) under the Ministry of Power, Energy and Mineral Resources (MPMER).

"Currently, we are the largest importer of LPG in Bangladesh and import around 10,000 tonnes of LPG per month," Mr Alam said.  

BM Energy imports LPG from spot markets of different countries including Singapore, Vietnam, the Maldives, he added.

The firm has a 6,500-tonne LPG storage capacity, which is 1,500 tonnes higher than the government's requirement for doing LPG business, Mr Alam said.

The use of LPG as auto fuel started in Bangladesh in 2005 with a single LPG fuelling station installed by a privately- owned LPG firm and since then the total number of LPG fuelling stations reached 12, he added.  

The use of LPG as an auto fuel is on the rise in Bangladesh due to its growing cost-effectiveness compared to petrol and octane, he said.

The pump price of diesel is Tk 65 per litre while petrol and octane prices are Tk 86 per litre and Tk 89 per litre, respectively while CNG price is Tk 40 per cubic metre. LPG is now being sold at Tk 50 per litre at pumps.

Country's petroleum product and CNG (compressed natural gas) sellers have welcomed the entrance of LPG as auto fuel in the country's market.

"We will be happy to sell LPG from our pump stations after installing required machine and equipment once the use of fuel grows," convener of Bangladesh Petrol Pump and Tank-Lorry Owners-Workers Unity Council Nazmul Haque told the FE Sunday.

He said, "Many of us have already shown interest to install auto gas filling stations," he said.

The country currently has around 4,800 pump stations from where gasoil and gasoline are being sold to retailers.

"It will be an added product in our selling portfolio," said general secretary of Bangladesh CNG Filling Station and Conversation Workshop Owners Association Farhan Noor, pointing to sell of LPG as auto gas.

Currently, there are some 580 CNG refuelling stations across the country, he added.

Bangladesh's LPG market is import-oriented as more than 90 per cent of total requirements is met through imports, Deputy Secretary of EMRD Akramuzzaman said.

Demand for LPG in the country has seen a strong growth since 2016 due to prolonged suspension of piped natural gas connections and growth in the use of LPG as an auto fuel, he added.

Bangladesh's LPG demand in 2016 was around 0.4 million tonnes, up 33 per cent from 0.3 million tonnes a year earlier, and the government forecasts LPG consumption to increase further to 0.5 million tonnes in 2017.

State-owned LP Gas Ltd, a subsidiary of Bangladesh Petroleum Corporation (BPC), produces only 20,000 tonnes of LPG annually.

More than half a dozen private companies including BM Energy, Laugfs Gas, Omera Petroleum, Totalgaz, Bashundhara, Jamuna Spacetech and Linde --import a combined 480,000 tonnes.

Mr Akramuzzaman said there has been growing interest in securing government licences to install new LPG stations and conversion workshops as several players are willing to establish a strong foothold in the growing market.

"We received applications for around 1,000 LPG re-fuelling stations," he said.

Azizjst@yahoo.com
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