BERC hearing on gas tariff hike on Oct 06

A public hearing to justify the proposed hike in the gas tariff for the state-run fertiliser factories is scheduled to be held on October 6.
Bangladesh Energy Regulatory Commission (BERC) has convened the hearing at the BIAM auditorium in the city.
The hearing is set to kick off with a presentation from state-run Petrobangla on its proposal for raising natural gas tariff by 150 per cent to Tk 40 per cubic metre from existing Tk 16 per cubic metre for government-owned fertiliser factories to facilitate import of an increased volume of liquefied natural gas (LNG).
The state-owned Petrobangla's subsidiary gas marketing and distribution companies including Titas Gas Transmission and Distribution Company, Bakhrabad Gas Distribution Company Ltd, Jalalabad Gas Transmission and Distribution System Ltd, Sundarban Gas Company Ltd, Pashchimanchal Gas Company Ltd, and Karnaphuili Gas Distribution Company Ltd have also submitted proposals separately to the BERC, seeking gas tariff hike.
The BERC has urged all the interested individuals and institutions to submit their names by September 28 and their pre-hearing comments or written statement to the commission by September 30.
According to officials, Petrobangla has planned to import at least seven additional LNG cargoes with the proceeds from the proposed hike in the gas tariff to feed the gas-starved fertiliser factories, officials have said.
If the tariff is hiked, the Petrobangla would be able to ensure supply of 250 million cubic feet per day (mmcfd) of gas during six months (October to March) of a year, 165 mmcfd during two months -- April and May, 175 mmcfd for the month of June and 130 mmcfd during three months from July to September, said sources.
Besides, the Petrobangla will be able to import a total of 115 LNG cargoes in a year, about 6.48 per cent up from the existing 108 ones with the proceeds from the proposed tariff hike, said sources.
Even after the proposed hike, there will be a deficit of Tk 83.55 billion, if seven additional cargoes are imported, officials said, adding that the Petrobangla expects to meet the deficit with the government subsidy.
The blended cost of gas would soar to Tk 28.78 per cubic metre from the existing Tk 24.56 with the increased volume of LNG imports.
Earlier, the BERC had hiked the natural gas tariff for fertiliser factories by 259.55 per cent to Tk 16 per cubic metre from the previous rate of Tk 4.45. The revised rate came into effect on June 1, 2022.
But, the fertiliser factories are not paying gas bills regularly to Petrobangla's subsidiary gas-marketing and distribution companies, said sources.
As of June 2025, the fertiliser factories owed around Tk 10.39 billion to different gas marketing and distribution companies, they mentioned.
Petrobangla and its subsidiary companies have sent the tariff proposals to the BERC after consultation with the Bangladesh Chemical Industries Corporation (BCIC), operators of the state-owned fertiliser factories and the Ministry of Industries, said sources. Currently, four fertiliser plants -- Jamuna Fertilizer Factory, Ashuganj Fertilizer and Chemical Company Ltd (AFCCL), Chittagong Urea Fertilizer Ltd (CUFL), and Karnaphuli Fertilizer Company Ltd (KAFCO) -- remain shut for want of natural gas.
And the combined gas requirement for the fertiliser plants is estimated at 212 mmcfd.
Bangladesh's demand for urea fertiliser was around 1.56 million tonnes in the fiscal year 2024-2025, down from the previous fiscal's 1.748 million tonnes.
On account of procuring non-urea fertiliser, the government had to spend around US$1.04 billion during the last fiscal year.
The government recently revised the gas tariff upward for the Karnaphuli Fertilizer Company Ltd (KAFCO), a joint venture fertiliser company, to Tk 30 per cubic metre.

Azizjst@yahoo.com