Energy div for raising gas price for Lafarge cement

The government has initiated a move to increase the price of natural gas supplied to the multinational cement company LafargeHolcim Bangladesh Limited, formerly Lafarge Surma Cement, 15 years after signing the gas supply agreement with the company.
The energy division on Thursday formed a five-member committee to review the gas price in line with the price set by the Bangladesh Energy Regulatory Commission, state-run Jalalabad Gas Transmission and Distribution System Limited managing director Md Khalequzzaman told New Age, on Saturday.
He said that the company had been supplying natural gas at a much lower price than the price set by the energy commission, the country’s energy watchdog and single authority to fix the gas prices for different consumers.
The committee, comprising of two each from Jalalabad gas company and the cement company and one from Petrobangla, the gas company’s parent organisation, was given 10 days to submit its recommendations, an energy division official said.
LafargeHolcim was created in 2017 after the global merger of Holcim and Lafarge where 58.87 per cent of the new company’s shares are now jointly owned by Switzerland’s LafargeHolcim Group and Spain’s Cementos Molins Group while some 5.50 per cent shares are owned by two local companies and 35 per cent shares are offloaded in the country’s stock market.
The energy division took the initiative after the Jalalabad gas company declined to supply gas to the cement factory at lesser price than the one set by the energy commission.
On January 14, Spanish ambassador to Dhaka, Alvaro de Salas Gimenez de Azcarate, in a letter requested the state minister for power, energy and mineral resources Nasrul Hamid not to raise the price of natural gas supplied to the cement factory and to follow the price set out in the contract.
The ambassador also wrote, ‘It is also the expectation of this Embassy of Spain, as well as the present and potential Spanish investors in Bangladesh, that the terms of binding agreement shall be adhered, respected and upheld by the government of Bangladesh.’
When asked about the contractual bindings, an energy division official said that there were provisions specified in the contract enabling the government to adjust the gas prices from time to time.

Under a 20-year contract signed in 2003 with the Lafarge Surma Cement, Jalalabad gas company until now supplies 16 million cubic feet or 453,129 cubic metre natural gas per day at approximately Tk 7.80 per cubic metre to the cement factory at Chhatak in Sunamganj.
The energy commission, however, set the gas price for such industrial consumers at Tk 8.36 per cubic metre with effect from September 1, 2015 and again raised the price to Tk 9.62 per cubic metre with effect from June 1, 2017.
During public hearing held before fixing the gas prices in 2015 and 2017, the government, the gas distribution company and the energy commission drew severe criticism from experts and consumer rights groups for supplying natural gas to the cement factory at a fixed price set in a contract that was signed in 2003. 

News Courtesy: www.newagebd.net