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Bangladesh - March 21, 2022

Petrobangla under fire at public hearing

Proposed gas price hike

UNB: State-run Petrobangla’s proposal to hike retail gas price faced stiff opposition from groups representing consumers, citizens, businesses and professionals at a public hearing that began at the city’s BIAM auditorium yesterday. Bangladesh Energy Regulatory Commission (BERC) is holding the hearing responding to the proposals of eight gas sector entities including Petrobangla to raise gas price by 117 per cent. The hearing will continue till Wednesday.
The consumer rights groups said that any rise in gas price will be totally illogical and unfair at this moment when the people are struggling price hike of essentials resulting from Covid-19 pandemic shock.
BERC chairman Abdul Jalil, who presided over the sessions, expressed his resentment on the proposals of different gas companies saying that their data on financial and technical issues are mismatching with each other’s.
He said there should be a central data system from which accurate information could be found before taking decision on any issue in the gas sector.

He also said the data presented by the Petrobangla could not satisfy the people.

On the first day of the hearing, officials of Petrobangla and Gas Transmission Company Limited separately placed their proposals in two separate sessions in the morning and after lunch.

The Petrobangla officials claimed that the annual expenditure of the organization will increase to Tk 65,225.75 crore due to import of LNG (liquefied natural gas) and other cost escalations.

As a result, on an average gas price needs to be increased to Tk 20 from the existing Tk 12.60 per cubic meter.

A technical team of the BERC disagreed with the claim of Petrobangla and placed its report saying that state-run agency still has a unutilized fund of about Tk 2500 crore as surplus after meeting its expenses.

Opposing the claim of the Petrobangla, Prof Shumsul Alam, advisor of the Consumers Association of Bangladesh (CAB) challenged the authenticity of the data and statistics provided by its officials.

He said he had sought different data from Petrobangla and other seven companies, but they did not provide it, which is a violation of the BERC Act.

He raised a number of questions on the merit of Petrobangla’s proposal and demanded for a cut in its unfair expenses and reducing the system loss instead of increasing the price of gas to adjust its cost.

He also urged the BERC to form a high level commission composed from representatives of the consumer groups to ensure good governance in the gas sector.

President of Bangladesh Sadharan Nagorik Samaj Mohiuddin termed the proposal of the Petrobangla and GTCL baseless and unfair and misleading.

“If any rise in gas price comes on the basis of the Petrobangla proposal, it will be disastrous”, he said.

Eminent energy expert Dr Badrul Imam said the current crisis in the gas sector is deeply rooted in the government’s failure to conduct exploration.

“In last 20 years, there has been no major exploration works conducted in the gas sector”, he observed.

He said it will be totally illogical to raise gas prices for import of only 3 per cent gas from the international spot market.

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