Firms get initial nod to set up 1,200 LPG auto refuelling stations

Around a dozen companies got a primary nod from the government to set up 1,200 LPG auto refuelling stations across the country, said a top official of the Department of Explosives.

Beximco, Intraco, Navana, Petromax and Besto are some of the companies that received the approval for the liquefied petroleum gas plants.

“We hope the LPG auto stations will be in operation next year or early 2018,” Shamsul Alam, chief inspector of explosives, told The Daily Star.

Policies on auto gas and bottling plants have already been formulated. Once the franchisee policy is prepared, the department will start issuing the final licences.

Alam said the energy and mineral resources ministry is working on formulating the franchisee policy, which will set how many stations can be established by each company.

Before getting the final licence, he said, the applicants have to go through vigorous tests and should have storage and bottling facilities in place.

LPG is an alternate fuel for motor vehicles and is used in more than 100 countries. But the LPG market is still small in Bangladesh.

Also, a liberal energy policy by the government encourages many national and multinational companies to establish LPG storage and bottling plants in Mongla and Chittagong.

Bangladesh consumed only 1.6 lakh tonnes of LPG in 2015 to meet the growing demand for cooking gas, according to industry sources. Of the amount, 1.42 lakh tonnes were imported and 18,000 tonnes were generated from different government factories as a byproduct.

Presently, there are around 600 CNG stations that refuel motor vehicles across the country. But many parts of the country, especially the southern districts, do not have CNG stations as gas is not available in those areas.

Beximco Group has applied to set up 500 LPG auto refuelling stations across the country in the next two years. It will franchise the operations of the filling stations.

The cost of the Beximco project, which will also facilitate sales of LPG for cooking and industrial purposes, was estimated at around Tk 1,000 crore, according to the company.

Like fuel oil such as petrol, diesel and octane, the government would not intervene in fixing the price of LPG, according to an energy ministry official.

“Businesses themselves will set the price. But we want a competitive market so that none has a monopoly on the market,” said the official.

Presently, LPG is cheaper than petrol and octane, industry insiders said.

According to an LPG selling company that has set up three LPG filling stations, the approximate cost saving of LPG over petrol is about 30 percent.

“Our assessment shows that if the price of LPG is 35 percent lower than octane, it is viable,” a senior official of the company said.