Omera Petroleum to enter LPG market in March
Omera Petroleum is set to supply liquefied petroleum gas to households and industries from March next year in a bid to tap the growing demand for an alternative to piped gas.
A subsidiary of lubricant supplier MJL Bangladesh, Omera Petroleum has invested around Tk 540 crore to set up operations, which includes the purchase of the country's first LPG carrying barge, Omera Princess, and incorporating European technology at its facilities.
“This reflects our commitment to ensuring global standards,” said Ishtiaq Ahmed, Omera Petroleum's chief executive officer.
To be sold under the brand name of Omera LPG, the cylinders would come in: 5.5kg, 12kg and 35kg. For industries, it would provide tailored solutions.
The company plans to sell 5 lakh LPG cylinders in 2015, according to Tanzeem Chowdhury, Omera Petroleum's manager for corporate planning.
With 2,500 million cubic feet of natural gas supply per day, it is impossible to satisfy all the sectors of the country's massively growing economy, he said.
“Bangladesh falls among the few countries in Asia that still supply piped natural gas to households. Our finite supply of natural gas should be completely redirected to the productive sectors in order to sustain our growth rate.”
As a consequence, the alternative left for households is LPG, Chowdhury said.
While that is a good solution to the supply constraints, it will only be viable if the alternative source has the capacity to meet the households' demand.
Given these circumstances, the annual market for LPG will stand at 5 lakh tonnes in the next ten years, from the present 1.5 lakh tonnes, according to Chowdhury.
At present, 80 percent of the country's annual demand for LPG is met by imports and the rest is produced by state-run Bangladesh Petroleum Corporation.
Private players like Bashundhara, Jamuna Spacetech, French TotalGaz and Australian Kleenheat sell LPG by importing it.
Omera Petroleum, which will import LPG as well, has the storage and distribution network of 100,000 tonnes a year, and at any one time, it would have a capacity of around 4,000 tonnes, which is by far the highest in Bangladesh, said Ahmed.
Its barge has the capacity to carry 300 tonnes of LPG, and is also equipped to supply bulk LPG to any industrial customer based on the riverside.
“By utilising the river routes, we can ensure uninterrupted supply to the Dhaka region from Mongla, where our main plant is located. This is a new benchmark for supply chain management of LPG in the country,” Ahmed said.
The company has six modern road tankers to supply LPG to its three satellite stations in Bogra, Ghorashal and Chittagong, and will also be a means to supply bulk LPG to industrial zones, he said.
A 12kg cylinder sells for Tk 1,450 at present, down from Tk 1,600-1,700 last year. BPC, on the other hand, sells the same amount for Tk 700.