The state-run Bangladesh Petroleum Corporation (BPC) is looking for a joint venture (JV) partner for construction and operation of an import-based LPG storage, bottling and distribution plant.
BPC has planned to import LPG (liquefied petroleum gas) in bulk quantity after building large LPG storage tanks under the JV partnership.
It will drastically bring down the fuel's import cost, BPC director (operations and planning) Sayed Mozammel Haque told the FE on Tuesday.
The state-run oil corporation aims to increase its LPG production capacity by five-folds to 120,000 tonnes per year from existing 20,000 tonnes per year to cater the mounting demand of the fuel, he also said.
"Several foreign firms have already talked with us, expressing their interest to establish JV with BPC."
The UAE's Emirates National Oil Company (ENOC), Malaysia's Petronus, and Indian Oil Corporation (IOC) are eager to set up JV with BPC, Mr Haque added.
"We have sought allocation of sufficient land at Matarbari in Maheshkhali under Cox's Bazar to implement the planned LPG project."
Once the JV is established, BPC will import around 25,000-30,000 tonnes of LPG at a time through large vessels.
Currently the operational LPG firms import a maximum of around 3,000 tonnes of LPG through a single cargo due to their storage limitations.
Freight cost will drop by nearly 30-40 per cent to US$ 60 per tonne from the existing $100 per tonne, he opined.
Officials said BPC floated a tender last year, seeking expression of interest (EOI) from various firms for selecting a JV partner to implement the project.
BPC's wholly-owned subsidiary LP Gas Ltd floated the tender. However, the process went in vein, said LP Gas general manger Fazlur Rahman.
Sixteen firms submitted EOIs, from which a short-list was prepared. LP Gas later requested the companies to submit their request for proposal (RFP). But none of the firms turned up to submit RFP, he added.
LPG consumption in the country has witnessed a stunning four-fold growth over the past three years, as more and more households, commercial entities and vehicles are opting for the fuel.
Around 1.0 million tonnes of LPG are likely to be consumed in the current calendar year 2018, up from around 250,000 tonnes in 2015, deputy secretary of Ministry of Power, Energy and Mineral Resources Akramuzzaman told the FE on Saturday.
The volume of LPG consumption was around 650,000 tonnes in 2017 and 400,000 tonnes in 2016, according to stakeholders and market players.
Favourable government policies, duty waiver on import of LPG and required machinery, and drastic move against illegal gas connections have ramped up LPG use across the country, said Akramuzzaman, who looks after LPG-related issues.
A government strategy to promote use of LPG instead of piped natural gas in order to cope with the fast-depleting gas reserve in the country has also pushed up LPG consumption.
Currently, Bangladesh's actual demand for LPG is around 2.0 million tonnes per year, as consumers are using kerosene and wood as alternatives to LPG due to lack of its availability, the official added.
