Consumers’ right groups on Thursday severely criticized the gas distribution companies for sanctioning loan for gas and oil exploration without approval from the regulatory authority Bangladesh Energy Regulatory Commission (BERC).
According to sources, various gas distribution companies have already provided Tk 230 crore loan to state-owned Bapex to help facilitate exploration of oil and gas in a shallow sea block in the Bay. In return the Bapex will pay back Tk 262 crore including the interests.
The process to disburse the loan to the state-owned agency requires approval from the regulatory body BERC as the body sets required tariffs for gas distribution companies. But the companies do not have proper approval from the authority that raised questions.
“Disbursement of the loan for risky project has already raised question as output of the natural gas from the block is almost uncertain,” said the consumers right groups at the hearing on natural gas tariff hike on Thursday.
Consumer Association of Bangladesh (CAB) energy adviser Prof M Shamsul Alam asked the Bakhrabad Gas Distribution Company whether they sought any approval from BERC during disbursement of loan for Santos shallow block. Representative of Santos said they received approval from state-owned Petrobangla for disbursement of Tk 20 crore only for the project.
Presided over the hearing, BERC chairman Monowar Islam said, “How the government will conduct the development activities without expenditure.” Prof Alam replied, “The gas distribution companies invested money from consumers and then put it in loss.”
But, the government should take responsibility of any loss through providing subsidy for costly LNG import, he opined.
The Bakhrabad Gas Distribution Company said they have already provided Tk 1207 crore including Tk 55 crore net revenue to government exchequer.
Pachimanchal Gas Distribution Company also sought to raise Tk 0.8091 per cubic meter of natural gas whereas the technical committee found the company will require only Tk 0.2651 per cubic meter of natural gas. Now, the company has received Tk 0.2654 per cubic meter of natural gas.