Megha Petroleum teams up with Delta LPG for selling gas

Megha Petroleum will sell the autogas supplied by the Delta LPG through its filling stations across the country.

For the expansion of business, the company signed an agreement with Delta LPG on the sale of LPG (autogas) parallel to its sale of petroleum oil by establishing LPG refuelling stations in the filling stations, said the state-owned petroleum products distributor in a filing with the Dhaka Stock Exchange on Wednesday.

As per the agreement, Meghna Petroleum, a subsidiary of the Bangladesh Petroleum Corporation, will receive a commission of Tk 0.50 against per liter sale of LPG.

Delta LPG is a separate entity of TK Group—one of the biggest business conglomerates in Bangladesh.

However, Meghna Petroleum's share dropped 1.3 per cent on the Dhaka Stock Exchange on Wednesday.

Earlier, Meghna Petroleum signed similar agreements with several companies – Energypac Power Generation Limited and LAUGFS Gas (Bangladesh), JMI Industrial Gas Ltd, Unitex LP Gas Limited, Beximco LPG Unit 1, Bashundhara LP Gas, Omera Gas One, Unitex LP Gas, Petromax LPG Ltd, and BM Energy (BD) Ltd.

In the first quarter of this year, its earnings per share stood at Tk5.97, down from Tk17.40 in the same period a year earlier due to the coronavirus restrictions.

The government holds 58.67 percent stake in Meghna Petroleum, followed by institutional investors 30.28 per cent, foreign investors 0.56 per cent, and general investors 10.49 per cent.

LPG sector is booming in Bangladesh due to its cost effectiveness compared to diesel, octane, and petrol.

Moreover, the country’s petroleum products and CNG retailers see autogas as an added product in their selling portfolio.

Over the last few years, the government took several policies on LPG to meet the huge future demand for liquefied petroleum gas in the household and transportation sector, inviting entrepreneurs to invest in the sector.

LPG increasingly becomes popular among domestic users such as cooking for its cost-effectiveness, energy-efficiency and environment friendly.

The LPG business started in 2005 when Australia-based Petredec Elpiji had established the first filling station in Bangladesh.

Since then, the number of LPG refuelling stations across the country increased manifold boosted by favourable policy and mounting demand.