Petrobangla is set to submit a fresh proposal to the energy regulator for hiking natural gas tariff for all types of consumers within the next several months, a top official said Tuesday.
Petrobangla's subsidiary companies will calculate 'upstream costs' of natural gas before submitting the tariff hike proposal to the Bangladesh Energy Regulatory Commission (BERC), Petrobangla Chairman Hussain Monsur told the FE Tuesday.
The BERC will then scrutinise the proposals from the subsidiary companies and hold public hearings to announce a fresh hike of natural gas tariff.
He said the Energy and Mineral Resources Division under the ministry of power, energy and mineral resources (MPEMR) has recently permitted Petrobangla to propose a hike in natural gas tariff considering 'upstream costs' meaning costs of natural gas production.
Petrobangla sought the permission from the MPEMR to propose the hike in natural gas tariff considering the 'upstream costs' in February this year.
But the MPEMR took almost six months to prepare a tariff hike proposal, said an official.
"We have not yet started the process of calculating the upstream costs of natural gas for raising tariff for consumers," said the Petrobangla official. But the process will be initiated soon, he added.
The energy regulator last raised natural gas tariffs for all types of domestic consumers, excepting compressed natural gas (CNG), by 11 per cent on August 1, 2009.
The BERC also hiked the price of CNG by 20 per cent to Tk 30 per unit on September 20, 2011. When contacted, BERC Member Dr Salim Mahmud said Petrobangla and its subsidiaries are yet to submit proposals to the energy regulator for raising natural gas tariff for consumers.
Petrobangla in March 2012 had submitted a proposal, on behalf of its subsidiary gas companies, to raise natural gas tariff by 34 per cent on an average for power plants, fertiliser companies, tea gardens, industries and compressed natural gas (CNG) filling stations.
Instead of raising natural gas tariff, the Commission then had asked Petrobangla to direct its subsidiary gas marketing companies to submit tariff hike proposals separately for consideration, Mr Mahmud said.
But none of the country's six gas marketing companies - Titas Gas Transmission and Distribution Company Ltd, Jalalabad Gas Transmission and Distribution System Ltd, Bakhrabad Gas Distribution Company Ltd, Paschimanchal Gas Company Ltd, Karnaphuli Gas Distribution Company Ltd and Sundarban Gas Company Ltd - is yet to come up with tariff hike proposals separately, he said.
"We shall consider gas tariff hike only after getting separate proposals from the gas marketing companies that are involved in selling natural gas to user ends," Mr Mahmud said categorically.
A senior Petrobangla official said natural gas tariff hike is necessary to carry out oil and gas exploration and other necessary development works in the energy sector.
Petrobangla in its proposal in 2012 had sought the tariff for per unit (1,000 cubic meter) of natural gas to increase by 5.24 per cent to Tk 84 for power plants.
It sought to raise the tariff by 9.71 per cent to Tk 80 from Tk 72.92 for fertiliser factories and by 32.60 per cent to Tk 220 from Tk 165.91 for industrial users. For privately-owned smaller power plants, known as captive power plants, the hike was proposed by 102.94 per cent to Tk 240 from Tk 118.26.
Petrobangla has proposed to raise natural gas tariff by 30.55 per cent to Tk 350 from Tk 268.09 for commercial consumers, by 20.55 per cent to Tk 200 from Tk 165.91 for tea estates and by 39.10 per cent to Tk 905.92 from Tk 651.29 for CNG gas refilling stations.
Earlier in a separate proposal in January, 2012, Petrobangla had sought to raise natural gas prices for domestic consumers by up to 122 per cent, which was dropped later following the Energy Ministry's intervention.
It had proposed doubling of retail gas prices to Tk 800 per month for domestic consumers with a single burner gas cooker and by 122 per cent to Tk 1,000 per month for those with a double burner.
Petrobangla then did not seek to raise the price of compressed natural gas (CNG), but the Energy Ministry recommended to increase the tariff for CNG, most of which is consumed by motor vehicles.
The country's overall natural gas production now hovers around 2,300 million cubic feet per day (mmcfd), against the demand for 2,700-3,000 mmcfd.
Gas shortages have pushed Petrobangla to ration its supplies to industries, power plants and fertiliser factories.
azizjst@yahoo.com
