A dozen private and one state-owned petrochemical and refinery plants in the country go bust for discriminatory treatment allegedly by some government high-ups in cahoots with a vested-interest group, sources said.
The unfair acts imperilled around Tk 20 billion (US$150 million) worth of investment while weakening the supply chain of petroleum products on the local market, market-insiders said.
They alleged that a strong syndicate of vested interest, led by a section of high-ups at the Ministry of Power, Energy and Mineral Resources (MPEMR), patronised only three big privately-owned fractionation plants that had made whopping gains during the immediate-past authoritarian regime.
This uneven playing field created by the administration for the trio has pushed the other players in the industry on the brink, they added.
They reported discrimination in the allocation of locally produced condensate - a major input for maintaining operations of such plants. The Energy and Mineral Resources Division (EMRD) allocated the raw material for the trio "in exchange for bribes", they alleged.
State-run Petrobangla and its subsidiary companies allocate the condensate, a by-product from gas fields, to the three biggies - Super Petrochemicals Ltd, Petromax Refinery Ltd and Aqua Refinery Ltd - as instructed by the EMRD, the insiders said.
Condensate is a low-density mixture of hydrocarbon liquids - present as gaseous components in the raw natural gas -used as raw material to produce petroleum products like diesel, petrol and octane, kerosene etc.
Condensate has been available in Bangladesh with the initiation of gas production several decades back.
Of the total condensate output of 9,500 barrels per day (bpd) this year in the country, according to the EMRD, Super Petrochemicals Ltd received 2,250 bpd while Petromax Refinery Ltd 2,250 bpd and Aqua Refinery Ltd 750 bpd.
Apart from these three fortunate plants, Sylhet Gas Fields Ltd - the lone state-run fractionation plant--is getting condensate to the tune of 4,250 bpd, as per the condensate-allocation sheet inked by MPEMR joint secretary Shamima Ferdous.
According to a senior Petrobangla official, who preferred not to be quoted by name, these three privileged companies got licences on condition that they will import condensate and use naphtha, a by-product of Eastern Refinery Limited, to produce refined petroleum products.
These companies do not have permission to use locally produced condensate.
On the contrary, the 12 underprivileged private companies that are not getting condensate allocation for over the past several years were licensed on the basis of use of locally produced condensate to produce petroleum products.
However, due to having connivance with the vested quarter, the three 'fortunate' companies started getting allocation of locally produced condensate during 2018. "They have squeezed condensate imports drastically afterwards," said the official.
The Petrobangla chairman was not available for comment despite repeated attempts.
The government has stopped condensate allocation to the ill-fated companies subsequently, leading to their closure, president of the Petrochemical and Refiners Association of Bangladesh (PRAB) Md Mamun Salam told the FE on Monday.
Not only the dozen ill-fated private petrochemical and refinery plants, Petrobangla also stopped providing condensate to a state-run condensate- fractionation plant owned by Eastern Refinery Ltd (ERL) to pave the way for making fortunes for the trio, said sources.
The ERL's plant worth Tk 1.0 billion had got only around 700 barrels of condensate per month since 2008 till early 2021 from Petrobangla to produce diesel, petrol, octane, and kerosene, a senior official of the state-run Bangladesh Petroleum Corporation (BPC) said.
"The plant remained idle since April 2021 after suspension of condensate allocation by the EMRD," said the official.
The ill-fated plants that remained shut since 2018 are Synthetic Resin Products (pvt) Ltd, Golden Condensate Oil Refine Factory Ltd, CVO Petrochemical Refinery Ltd, PHP Petro Refinery Ltd, Rupsha Tank Terminals and Refinery Ltd, Universal Refinery (Pvt) Ltd, JB Refinery Ltd, Carbon Holding Ltd, Aqua Mineral Turpentine and Solvents Plants Ltd, Super Refinery (Pvt) Ltd, Lark Petroleum Company Ltd and Chowdhury Refinery Ltd, said the PRAB president.
"Apart from bankruptcy," he said, "several of these companies are also facing cases filed by different banks as they are not being able to repay their loans. Around 5,000 employees of these companies also turned jobless."
Mr Salam alleged that the state-run gas entities stopped supplying condensate 'unilaterally', and without prior notice to the companies.
The PRAB has long been requesting the EMRD to reconsider its decision and resume supplying condensate to its member-companies, he added.
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