Mfg industries turn to CNG cylinder: Higher production cost creates crisis

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Shah Alam Nur :Manufacturing industry is using under duress compressed natural gas (CNG) cylinder in their factories in absence of adequate gas supply and lack of new connections, industry insiders said.As a result the manufacturers are counting six time higher cost of production, with risks of major accidents in the process of fuelling their industries.According to the Bangladesh Garment Manufacturers and Exporters Association (BGMEA), the natural gas tariff for the industrial sector is Tk 6.74 per one cubic foot whereas the manufacturers are buying one cubic foot of CNG for Tk 35.The manufacturing units taking recourse to the costly fuel include readymade garment factories, footwear, knit garment, farm products, textiles, cement, glass, ceramic and plastic units.Many of the entrepreneurs said that for the last five years, they had been using CNG cylinder at their industrial units, as the government in 2009 stopped giving new gas lines.Petrobangla (Bangladesh Oil, Gas & Mineral Corporation) data shows that the country produces around 2,482 million cubic feet of gas per day against the demand for about 3,000 million, leaving a daily shortfall of around 518 mmcf.Manufacturing units using CNG cylinder are spreading in industrial belts across the country, including Dhaka, Chittagong, Narayanganj, Munshiganj, Narsingdi and Gazipur.According to the Federation of Bangladesh Chambers of Commerce and Industry (FBCCI), in the last five years more than 1,500 entrepreneurs, most of them bulk gas users, have their applications pending with Titas Gas Transmissionand Distribution Company Ltd. Many industries have been waiting since 2009 for new gas connections.According to Bangladesh Knitwear Manufacturers & Exporters Association (BKMEA), the industrial sector has a demand for 9.2 million cubic feet of gas. But less than 60 per cent is being met.”A large number of manufacturing industries have to use CNG cylinder to run their boilers without converting those to CNG usage,” Siddiqur Rahman, President of BGMEA, told The New Nation on Sunday.He said, their production cost at manufacturing units has increased drastically because CNG-using enterprises are spending at least six times higher above the cost of natural gas.He said, most of the industries could not utilise more than 35 per cent of production capacity as they don’t have required gas pressure.Faruk Hasan, Managing Director of Giant Group, a leading apparel manufacturer, said, the manufacturing industries are getting less than 60 per cent of gas out of total demand.He said “At washing plants, gas is main fuel, but they are facing shortage of gas. As a result, they don’t have any alternative, but to use CNG cylinder.”He regretted that many manufacturing units remained inoperative because of gas crisis, while some were running by using CNG cylinder or liquefied petroleum gas (LPG).Zakir Hossain Nayon, former President of Bangladesh CNG Filling Station & Conversion Workshop Owners Association, said, everyday they have been selling hundreds of CNG cylinders most of which are being used in industries.”Manufacturers are using bulk quantities of CNG cylinders, but the users don’t have permission from the department,” he said.He said that most industries were set up for pipeline gas, but they are using CNG cylinder without preparation. “It could result, anytime, in big accidents.”Nowshad Islam, Managing Director of Titas Gas Transmission and Distribution Company Ltd, said, “We have seen that CNG cylinder is being used in manufacturing industries illegally.”He said that many industries were waiting for new gas connections, but they could not install the gas line due to supply crunch.

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