Clear policy is crucial for local and foreign direct investment. The demand for liquefied petroleum gas (LPG) is increasing gradually in the country thanks to growing population and change in people’s lifestyle. We want to make our LPG supply more secure and easier by using latest technology to raise the market share, Tanzeem Chowdhury, chief executive officer (CEO) of Omera Petroleum Ltd & Omera Cylinders Ltd, tells The Business Post’s Rafikul Islam in an exclusive interview
Omera started LPG business in 2015, considering its growing demand. Please tell us about your current business overview.
In eight years of operation, Omera LPG has become the market leader having the highest market share in Bangladesh’s LPG sector. We are known for our high safety standards, consistent LPG supply round the year and excellent customer service (Hotline 16797).
We import LPG from Middle East countries, including Saudi Arabia and Qatar, as well as the USA, and ship it to Kutubdia in Cox's Bazar by very large gas carriers (VLGC). Later, LPG is transported to smaller ships (coasters) through ship-to-ship transfer. Coaster vessels make onward delivery of LPG to our plants in Mongla & Chattogram. We also sell LPG from VLGC to other operators.
Omera stores & bottles LPG in our five plants in different areas, including Mongla, Ghorashal, Bogura and Mirsarai. And gas is bottled in 5 kg, 12 kg, 25 kg, 35 kg & 45 kg gas cylinders. After fulfilling national demand, we are also exporting LPG to seven sister states of India.
Omera Cylinders Ltd, our sister concern, manufactures LPG cylinders at our factory in Habiganj district. From here, we supply cylinders to local market and export it to African countries as well. Omera Cylinders Limited is manufacturing new cylinders and also retesting/refurbishing cylinders of third party LPG operators in Bangladesh.
How many customers of OPL are in Bangladesh now? How much LP gas do you supply in the country every year?
Now Bangladesh imports about 120,000 tonnes of LPG per month. Omera sells around 27,000 tonnes per month through retail, industrial, autogas & export. As mentioned earlier, our Group also sells LPG to other operators from VLGC. So, in total our LPG supply to Bangladesh stands at 45,000 tonnes per month.
With more than 35,000 retailers across Bangladesh, Omera aims to meet the demand for environment-friendly LPG for all segments.
LPG is being embraced by industries as the most affordable clean energy solution, in which industries do you supply your gas?
In 2022, we noticed that industries were increasingly seeking energy to heat their boilers & furnaces. Then, we started a new division named ‘Omera Priority’ which brings the most secure and reliable LPG solution for industrial heating needs.
The demand is increasing gradually particularly in apparel and ceramic industry. Now around 20 per cent of our total gas is sold to industries.
LPG price will drop further than that of diesel if the government withdraws subsidy on oil. Besides, industrialists complain about not getting piped gas properly. So, they lean to use LPG.
As developing situation, there is no exact data on how much the industry has demand for gas. However, we arrange technical seminars in industries. LPG is also much safer than piped gas and others.
What is the demand for your gas in ceramic sector? Which ceramic companies do use your LP gas now?
Gas supply is always very important for the ceramic industry. If a furnace machine is shut due to low pressure of gas, it takes a long time to turn on.
Considering it, we have launched a new solution named ‘SNG’. When gas pressure drops in ceramic industry, our LPG enters into heater through software. There is absolutely no downtime/changeover time, so heater will not shut down.
Now we are getting good response from ceramic manufacturers. Already we have provided services to large ceramic companies who are happy getting it.
The sector has huge potential. It will drive our economy in future. Our LPG demand is also rising here. If all get services from us, they won’t face any gas crisis. We have that capacity.
A large ceramic company needs at least 800 tonnes of LPG monthly, if it is used. However, we need to create awareness among industrialists about safe use of the environment-friendly product.
Please tell us about the price range between LP gas and piped gas?
Our LPG’s price is somewhat higher compared to piped gas as the government is providing subsidy on piped gas. But now LPG price is lower than diesel/ furnace oil as the government withdrew subsidy on diesel.
If the government withdraws subsidy on piped gas, the prices of between LPG and piped gas will be almost the same.
Which is much safer LPG cylinder or piped gas?
Our LPG is safer than piped gas. We have over 50 lakh cylinders in residents. Very few accidents happened in the LPG in industry till now rather piped gas caused accidents several times. The accidents occur due to illegal line or lack of awareness among users.
We train up our clients when we supply our LPG to industry. Even we conduct safety audit yearly there for safety. Everyone should be aware of its use.
Current LPG’s demand will double by 2030. We want to double our sales within a short time. We are working in this regard.
Do you face any challenges to do business here?
As we are financially strong so we have no problem of LC opening now. But our problems are unclear policy and unadjusted price.
A clear policy is badly needed who will get natural gas and who will not. Unclear policy creates hurdle to investment.
Many industrialists face problem whether they will get natural gas. Clear message is needed for investment. Residents are also in doldrums.
Bangladesh Energy Regulatory Commission (BERC) fixed bottled gas price (Local portion) in 2021. It should be adjusted with the current inflation in Bangladesh.
What’s your future plan?
The demand for LPG is increasing in the country thanks to growing population and change in people’s lifestyle. Now our sale is mostly in cities but the demand is also going up in rural areas too. Our plan is to invest more in the sector in future.
We want to make gas supply easier and more secure by adopting latest technology to raise our share in local and export markets. Some foreign companies are showing interest to invest in the sector as LPG is the promising sector in Bangladesh.
