Gas crisis persists, production declines

Gas production in the country is steadily declining. Even with increased imports of liquefied natural gas (LNG) to cover the shortfall, the situation remains unmanageable. Supply is not increasing proportionately to meet demand, resulting in a persistent gas crisis. Therefore, the power generation capacity is not being fully realised. Meanwhile, complaints from residential and industrial consumers about the unavailability of gas continue to mount.

Bangladesh Oil, Gas and Mineral Corporation (Petrobangla) sources say the demand for gas now stands at 3.8 cubic feet per day. It is possible to manage the deficit through rationing if a minimum daily supply of 3 billion cubic feet of gas is maintained. However, the current supply has dropped to 2.7 billion cubic feet. As a result, the government was forced to cut gas supply to the power sector to boost supply to the industrial sector.

The country once produced 2.7 billion cubic feet of gas per day. However, as production declined, LNG imports began in 2018. Domestic gas production has now fallen to 1.85 billion cubic feet per day, and supply is now largely dependent on LNG imports.

Petrobangla has planned to supply 1.05 billion cubic feet of gas from imported LNG. A LNG cargo was scheduled to arrive on 25 May. Although it came on 28 May, offloading is being delayed due to adverse weather conditions. Some 800-850 million cubic feet of gas was supplied from LNG on Tuesday, which dropped to 600 million cubic feet on Thursday. Besides, the interim government has stressed on drilling wells to boost domestic gas production. However, it is highly unlikely that it would increase domestic production in the near future. Domestic production has slightly risen due to the addition of three new gas wells in recent times.

On 25 May, several leading business organisations held a joint press conference to raise complaints about the gas crisis in the industrial sector. The following day, the Ministry of Energy issued a statement saying that the industries have been supplied with more gas this year compared to previous years. The ministry announced that an extra 150 million cubic feet of gas will be supplied to the industrial sector each day.

However, speaking to Prothom Alo, several businesspersons said there was a gas crisis last year too. However, they have been suffering even more for the last one and half months. Their main concern is they are struggling to run the factory due to gas shortage. Although the government is talking about an additional supply to the industries, they are not seeing that much improvement.

They also provided information on gas supply to several factories on Monday. This indicates that the situation has not significantly improved; in fact, supply has further declined in some areas.

RMG conglomerate Little Group of Companies chairman Mohammad Morshed Alam told Prothom Alo he increased his investment from Tk 1.25 billion to 4 billion due to availability of gas back in 2014. Now, 60 per cent of the factory capacity remains idle. Although it has been said that there would be an increased supply to industries from Tuesday, he does not know about any such case. None of his factories got any additional supply.

According to the figures of the Bangladesh Textile Mills Association (BTMA), the Little Star Spinning Mill is supposed to get 37,000 cubic feet of gas per hour at a pressure of 10 PSI (per square inch) as per its agreement with the Titas. However, they are not getting enough supply due to lack of pressure. They are currently provided with 9000 cubic feet of gas per hour on average. The gas pressure was 2 PSI at 4:13 pm Wednesday afternoon, whereas it was 6 PSI on 9 May.

The gas pressure reading was 1 PSI at 10:00 am at the Nannu Spinning mill in the morning the same day. Gas pressure was below 1 PSI in one of the Anwar Group factories and 2.5 PSI at NZ textile at the same time. Meanwhile, the Intimate Spinning Mill had to close operations as there was no gas supply at all at the factory last Tuesday.

Speaking to Prothom Alo, Petrobangla chairman Md Rezanur Rahman said, “We are facing even more challenges due to decline in domestic gas production. We are procuring additional LNG cargos every month. However, it was not possible to provide an additional supply to industries as per the declaration due to rough weather conditions. Supply will increase once the depression in the bay clears up.”

The Energy and Mineral Resources Division said in a separate statement that the industrial sector has been provided with more additional supplies in the first four months of the year as compared to the past. However, the Petrobangla figures show the overall gas supply in the country has not increased significantly. The industries received more additional supplies per day compared to previous years in the first three months this year - 100 million cubic feet in January, 40 million cubic feet in February and 120 million cubic feet in March. However, the daily supply has dropped by 100 million cubic feet per day on average in April as compared to last year. The downward trend in gas supply continues in May too.

Sources in the energy sector say the power sector has a demand of 2.05 billion cubic feet of gas a day. The sector gets nearly 1.05 billion cubic feet at most against the demand. The government increased gas supply in the sector considering the highest demand for electricity in April, resulting in a crisis in the industrial and residential sectors. Recently, gas supply in the power sector was reduced to 920 million cubic feet. Therefore, the authorities are being forced to operate more expensive oil-powered plants instead of low-cost gas-powered plants, further increasing government subsidies.

Although gas supply increased to some extent in the industrial sector after reducing it in the power sector, it has not been possible to improve the situation in the residential sector. It has resulted in unavailability of gas in most parts of the capital.

Kamal Bhuiyan, a resident of Elephant Road, told Prothom Alo on Tuesday, “Gas is available only for 5 hours from 6:00 am to 11:00 am. There is no supply at all in the remaining times of the day. It has been going on for more than a month. Titas didn’t take any action despite several complaints.”

The Titas authorities say their demand for gas is 1.9 billion cubic feet per day and they are getting some 1.52-1.55 billion cubic feet against that. So it is not possible to provide gas as per the consumers’ demand.

Production in Narayanganj-based industries has been greatly hampered due to unstable gas pressure.

The gas pressure was 1 PSI from 9:00 am to 12:00 pm on Tuesday at the dying unit of Fair Apparels Limited in the Panchabati BISIC industrial city in Fatullah of Narayanganj, which increased to 4 PSI by 3:00 pm. Although gas pressure increases from time to time, it does not remain stable.

Speaking to Prothom Alo, Fair Apparels Limited deputy general manager Mohammad Masum said, “It’s taking more to gain the optimal temperature in the broiler due to lack of pressure. It’s taking around 16-17 hours to dye clothes in one shift instead of 10 hours. As a result, overall production is falling drastically.

On the same day, at BSCIC's MS Dyeing and Printing Finishing Limited, the gas pressure ranged from 0.8 PSI to 1 PSI between 6:00 am and 1:00 pm. Around 2:00 pm, the pressure rose to 4 PSI. Foap Tex Limited Dyeing has a daily production capacity of 8 tonnes. However, due to the gas crisis, production has dropped to 3 tonnes.

Gazipur based Sadma Group director Sohel Rana said, “The gas crisis has been prevalent for the last few months.”

Another garment factory managing director, Hazrat Ali said production cost is lower when the gas pressure is maintained. Now, due to reliance on diesel, production costs are increasing.

Speaking regarding this, Consumers Association of Bangladesh (CAB) energy adviser M Shamsul Alam said, “A little rise in the supply compared to the previous year cannot be a reasonable consideration. The main concern is whether the consumers get gas as they need. In fact, there has been no change in the government policy to ensure fuel safety.”

[Prothom Alo’s Gazipur correspondent Masud Rana and Narayanganj correspondent Mujibul Haque helped prepare this report with information]

*This report originally appeared on the print and online editions of Prothom Alo and has been rewritten in English by Ashish Basu