The supply of gas from the Bhola gas field in the form of CNG (compressed natural gas) officially started on Thursday with the first consignment reaching the factory of Graphics Textiles Limited in Dhaka’s Dhamrai.
State Minister for Power, Energy, and Mineral Resources Nasrul Hamid inaugurated the launching at a hotel in the capital.
The introduction of CNG from Bhola is expected to address the low pressure of gas affecting industries in the Dhaka region, officials said. The ministry has emphasized giving priority to areas experiencing low gas pressure.
Gas production in Bhola is managed by the Bangladesh Petroleum Exploration and Production Company (Bapex).
Sundarban Gas Company Limited (SGCL) procures gas from Bapex and distributes it to consumers. Intraco is facilitating gas supply to industries by acquiring it from Sundarbans.
Petrobangla Chairman Janedra Nath Sarker and Intraco Group Chairman Hakim Ali also spoke at the event.
How can Bhola gas be supplied to industrial zones?
The gas extracted from the Bhola gas field is being filled in cylinders before delivery to the factories. The gas, pressurized at 1,000 psi (per square inch), is transported in quantities of 3,500 cubic metres per cylinder via specialized trucks.
State Minister Nasrul Hamid highlighted the significance of this milestone, emphasizing that it is the first instance of such a gas supply in the country's history.
“In addition to cylinder delivery, plans include laying a pipeline connecting Barisal to extract Bhola gas, which will then be supplied to the Khulna industrial area. A pre-review of this plan is currently underway, and there are considerations for extending gas supply to the northern region, where a gas pipeline has already been established up to Rangpur,” he added.
Intraco Managing Director Riyad Ali expressed confidence in the progress, drawing parallels to the initial scepticism faced by CNG in vehicles, which has now been widely accepted.
The gas supplied from Bhola to the customer's end will be returned to its original condition (15 psi) at the customer's cylinder. To facilitate this, a Regulating Control Unit (RC) has been installed at designated customer endpoints.
Pricing
The price for the CNG has been set at Tk47.60 per cubic metre, while industrial establishments can receive gas directly from the pipeline at Tk30.
Addressing concerns about the pricing, Nasrul Hamid emphasized the need for the Bhola-Barisal pipeline, estimating a cost of around Tk1,500 crore.
He highlighted that the government covers the pipeline expenses, which include land and pipe costs. In evaluating gas prices, it is crucial to consider the comprehensive infrastructure investment, making the current pricing reasonable when accounting for all associated expenses.
5 more wells being drilled in Bhola
Secretary of Energy and Mineral Resources Division Nurul Alam said: “Now, 5 million cubic feet per day will be delivered. Gas production will gradually be increased. We are stepping up efforts to boost national output through the drilling of additional wells. There will be financial benefits if we can lower LNG imports.”
Petrobangla Chairman Janendra Nath Sarkar said: "A comprehensive plan has been undertaken for oil and gas exploration within the country. Already, five more wells are being drilled in Bhola which will also increase production capacity. More wells will be drilled in the master plan for 2026-28. The target of drilling 46 wells, which is already underway, has been increased to 49 wells. Among the drilled wells in that project, gas has been found in seven of them. This has added 125 million cubic feet of gas."
He further said: “We are working on the possibility of 120 more wells by 2026-28. We expect to identify 70-75 well locations. At least 50-60 wells will be dug out. All work will be completed before 2026.”
The SGCL and Intraco signed an agreement on May 21, 2023. Under the agreement, the company will transport Bhola's surplus 25 million cubic feet (daily) of gas in the form of CNG and supply it to the areas covered by Titas Gas.
Intraco will buy the gas at Tk17 per cubic metre and sell at Tk47.60 per cubic metre.
At the signing ceremony, SGCL Managing Director Tofail Ahmed said: “The Bhola gas field can produce 120 million cubic feet of gas per day. The combined demand for gas from all consumers is 92.32 million cubic feet. Due to a shortage of consumers, there is an excess of 27.68 million cubic feet of gas, but there aren't enough pipes to transport it to other regions of the nation.”
The letter from Bapex states that Bhola would have even more manufacturing capacity in 2024–2025.