The government is going to build the country’s first LPG mother terminal at Maheshkhali in Cox's Bazar district.
State-owned Bangladesh Petroleum Corporation (BPC) will build the terminal in a joint venture with two foreign companies, Marubeni and Vital Power, a BPC official said.
LP gas will be sold in bulk to various LPG companies from this terminal. The LPG terminal will have an operating capacity of about 10-12 lakh metric tons per annum. It is expected that the construction work will be completed by 2024.
Once completed, the transportation cost of LPG per ton will be reduced to $40. In addition to government control over the LPG market, prices are expected to fall sharply.
An Energy and Mineral Resources division official said on March 3, Prime Minister Sheikh Hasina approved a summary of the proposal of the energy division. On Monday, the energy division received a letter of approval from the Prime Minister.
The BPC, Japanese company Marubini and UK's Vittal Powerco are set to sign a Memorandum of Understanding (MoU) soon for the construction of the terminal.
The private companies are now importing two to three thousand metric tons of LP gas from Singapore, Malaysia and various countries in the Middle East under their own management for their LPG bottling plant. The cost through small ships from Singapore and Malaysia is $100 to $110 per tonne. However, the maximum cost of transporting ships with a capacity of 35,000 to 40,000 metric tons will be $ 65-$70 per ton, which means that the cost of transportation per ton will be reduced to $40.
The Energy Division says transportation costs are a big part of LPG. If the transportation cost is reduced, the price of LPG will be reduced a lot.
State Minister for Power, Energy and Mineral Resources Nasrul Hamid said that once the terminal is completed, a part of LPG will always be under the control of the government. The government will buy LPG from the world market at a fixed price. It will then sell to private entrepreneurs by adding transportation costs and terminal charges.
As a result, there will be no opportunity to increase the price of LPG. Now the government has no control over the price of LPG. He hopes that once the terminal is completed, the consumers will be relieved.
An official said that due to the low depth of the river, private LPG companies import LPG in small vessels. As a result, transportation cost for importing LP gas increases. Importing LPG in large ships will reduce the transportation cost.
BPC sources said the estimated cost of the project is $305 million. Of this, BPC and Vital Powerco have a 30 per cent to 60 per cent stake and Marubeni has a 40 per cent stake. Land has also been acquired for this project at Maheshkhali Power Energy Hub. Vittal and Marubeni will transfer 100% of the shares to BPC 10 years after the project is officially launched.
Earlier, the government had built LNG terminals. The government has no stake in the two LNG terminals. The government converts LNG to gas from there with only a certain amount of charge.
In addition, three separate terminals will be set up there to harness the full potential of the country's first deep-sea port, Matarbari. These are- Coal terminal for importing coal, LNG terminal for importing LNG and LPG terminal for importing LPG.
