LPG ventures weary of red tape

Several LP gas company executives told the Dhaka Tribune that in the new policy there are many bureaucratic difficulties. For instance, if they want to do business they have to take permission from eight places which were earlier from three places. According to the new policy, to set up and operate an LP (Liquefied petroleum) gas terminal, a plant or any other type of related business, permissions need to be obtained from the Department of Environment, Bangladesh Standard and Testing Institute, Department of Explosives, Fire Service and Civil Defence, district administration and local administration. In some cases, permission is also needed from Bangladesh Investment Development Authority, the Ministry of Commerce, Bangladesh Energy Regulatory Commission or other ministries and departments. The final approval must be taken from the Energy and Mineral Resources Division (EMRD). So the industry insiders feel these difficulties will be a barrier to popularising LP gas popular in household use. They also believe the policy will allow local conglomerates to monopolise the sector. A director of a LP gas company wishing anonymity said: “In this country altogether 10 companies are marketing LP gas. The amount of capital varies from one company to another. But the new policy only favours the big companies. “The policy says that if anyone wants to operate this business they need to establish an LP gas reserve tank which can hold 5,000 metric tonnes and have a road tanker or vehicle which can carry bulk LP gas,” the director said. On January 29, the EMRD issued a gazette declaring the LP Gas Operational Licensing Policy 2017 and saying it will be the main guideline for the industry. The policy says that the retail price of gas will be fixed in terms of the international market price of LP gas after talks with stakeholders. Asked, an official of the EMRD said that the division was planning to sit with officials from LP gas businesses. “After that meeting, we could make any changes that are needed,” the official said. LPG importers, manufacturers, transporters, terminals, bottling plants, dispensing or refuelling stations, conversion workshops — all these businesses are called LP Gas operators in the policy. Only the appointed master franchisee or franchisee or exclusive distributor or distributor and dealers of LP gas operators can distribute or market LPG. One LP gas operator is not allowed to refill another operator’s cylinders. To export LP gas, businesses have to take No Objection Certificates from the EMRD and in some cases approval from the Ministry of Commerce. State Minister for Power, Energy and Mineral Resources Nasrul Hamid said the policy had been designed with consent from all stakeholders. “There is room for revision if needed,” he added.