Operators seek LPG as interim fuel as gas crisis chokes industries
LOAB proposes faster approvals, easier equipment imports and tax reforms to make LPG a viable industrial fuel.
Highlights
- LOAB seeks LPG recognition as an interim industrial fuel
- Gas shortages and low pressure continue disrupting factory production
- LOAB proposes faster approvals for LPG infrastructure installations
- Operators want easier imports of tanks and related equipment
- LOAB seeks simplified equipment retesting and autogas licensing
- Tax reforms could make industrial LPG more economically viable
The LPG Operators Association of Bangladesh (Loab) has urged the government to formally recognise liquefied petroleum gas (LPG) as an alternative and interim fuel for industries as severe gas shortages and low pressure continue to disrupt factory production across the country.
In a letter to the secretary of the Energy and Mineral Resources Division (EMRD) on Monday, the association proposed an eight-point package of regulatory and policy reforms to accelerate the use of LPG by industries.
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The proposals include removing regulatory bottlenecks, eliminating dual-testing requirements for imported equipment, streamlining import approvals and making LPG more cost-effective compared with imported liquefied natural gas (LNG) and domestic grid gas.
"Due to the shortage and low pressure of natural gas in the industrial sector, normal production is severely disrupted. Loab considers the government's initiative to adopt LPG as an alternative, back-up and interim fuel to maintain economic growth and production to be highly positive," Loab President Mohammad Amirul Haque wrote in the letter.
The association also proposed that LPG imports, storage and industrial supply be handled exclusively through existing licensed LPG operators, rather than allowing individual factories to import LPG directly.
According to Loab, such a system would help ensure safety, quality control and government oversight while allowing industries to switch to LPG more quickly.
Faster approvals sought
Loab has called for a time-bound approval mechanism for installing bulk storage tanks, vaporisers, gas pipelines and burners at industrial facilities. It wants the current approval process, which can take one to 1.5 years, to be replaced with a swift and unified schedule.
The association also wants LPG operators to be allowed to import storage tanks and related equipment without waiting seven to eight months for preliminary design approval and site evaluation by the Department of Explosives (DOEx).
According to Loab, this would allow operators to maintain ready stocks of equipment and speed up the installation of LPG facilities at factories facing gas shortages.
The association has also called for abolishing or simplifying the re-testing of internationally certified LPG storage tanks and road tankers by the Bangladesh University of Engineering and Technology (Buet) after import.
Autogas licences
Loab has separately urged the government to lift the suspension on autogas station licensing that has been in place since 15 July 2023. It also wants pending licences to be issued to completed stations, provided operators give commitments against cross-filling.
The association said such measures would help expand the country's LPG infrastructure while maintaining regulatory safeguards.
Tax review sought
The association has also called for a review of the existing customs duty, VAT and tax structure on LPG and related equipment to make industrial LPG economically viable.
The association argued that the cost structure needs to be reviewed against the price of imported LNG and domestic grid gas, particularly as industries struggle with inadequate gas supply and low pressure.
LOAB said implementing the proposed administrative and policy reforms would give industrial plants a more dependable alternative fuel, protect existing investments and strengthen national energy security.
The proposals come as industries continue to face disruptions from inadequate gas supply and low pressure, putting production and investment under further strain.
