AN EXPLORATORY REVIEW OF BANGLADESH GAS SECTOR: 
LATEST EVIDENCE AND AREAS OF FURTHER RESEARCH

VIII.  GAS UTILIZATION IN THE FUTURE (10,24,29)

As already mentioned the current utilization pattern shows that the ammonia-urea fertilizer sector consumes approximately 35%, power 45% and other sectors (industry, domestic, commercial and seasonal) 20% of the gas consumption. We examine here the utilization of gas in the future by these sectors one by one.

8.1 Fertilizer Sector

The growth of the ammonia-urea fertilizer sector in the future will be limited. A 500,000 ton/year capacity urea plant to be located at Fenchugonj to replace the existing 39 year old NGFF is a likely possibility by 2005. It would mean an additional demand of about 25 MMSCFD gas if NGFF is shut down.

By 2005, another 500,000 ton per/year urea complex is likely to be built on the western bank of the river Jamuna. This will create an additional demand of 40 MMSCFD gas. With these two plants on-stream the country in 2010 will have a total urea production capacity close to 4 million ton per year including KAFCO against the current urea consumption of about 2.2 million ton per year.

If the two proposed 800 ton/day DAP plants to be built nearby CUFL come on-stream by 2005, these would further augment urea availability by about 200,000 ton/year. However, these two plants would create a demand for gas of 1.65 MMSCFD for steam and power generation.

This means that during the period 2002-2005, the gas consumption by this sector will remain static to about 90 BCF per year already mentioned. If the 500,000 ton/year ammonia-urea complex at Fenchugonj and two DAP plants come on-stream by 2005, the gas demand would be increased by about 27 MMSCFD.

From Tables 6.1 and 8.1 and Figures 6.1 and 8.3 it is evident that demand or consumption of gas by this sector does not increase without the commissioning of new plants. For example, since 1994 (after the commissioning of JFCL) the connected load for this sector has remained stagnant at 289 MMSCFD.

TABLE 8.1: CONSUMPTION OF GAS BY FERTILIZER SECTOR DURING 1991-2000

(served by 3 Gas Companies)

FIGURE 8.3: GAS CONSUMPTION BY FERTILIZER SECTOR (1990 – 2000)  
(AS SERVED BY THREE COMPANIES)

8.2 Power Sector

The current development in the power sector suggests that PDB on its own will not build new power plants after the on-going plants, namely, 210 MW gas based Siddirgonj plant and 300 MW coal based Barapukuria plant. It is likely that PDB will not build any more power plants beyond 2005

PDB’s role as a power plant builder is henceforth being replaced by IPPs. The much talked about WRIP has been shelved. IPPs’ plants are troubled by many ifs and buts including funds and concessions. IPPs have planned to produce 1260 MW power by 2005 (Meghnaghat-1 and 2 of 450 MW each and Haripur 360 MW); and would require about 150 MMSCFD gas at the peak and 120 MMSCFD on the average.

By 2005, if things proceed as planned; the gas based generation capacity would be increased by 1400 MW (PDB: 210 MW and IPPs: 1260 MW). The total generation capacity would be augmented by 1700 MW if the Barapukuria plant comes on stream. This will certainly improve the availability of power. Moreover, the installation of the captive and stand-by gas engine generators by the industries will further improve the power supply and its reliability.   

From Tables 6.2 and 8.2 and Figures 6.3 and 8.4 it is evident that the demand or consumption of gas in the power sector does not also increase without the commissioning of new plants. During the plan period 1995-2000, the additional gas fuelled power generation capacity added was 580 MW against the envisaged projection of about 1800 MW. In the 1990’s the gas based generation capacity added was 1090 MW in spite of the participation by IPPs and RPC.

TABLE 8.2: CONSUMPTION OF GAS BY POWER SECTOR DURING 1991-2000
(served by 3 Gas Companies)

FIGURE 8.4: GAS CONSUMPTION BY POWER SECTOR (1990 – 2000)
AS SERVED BY THREE COMPANIES

The industries, because of PDB’s unreliable power supply plus load shedding have been installing their own captive gas engine generators. This would add additional gas based generation capacity of about 1000 MW requiring an additional gas demand of about 150 MMSCFD at the peak. This will not necessarily mean an increase of annual gas consumption by the same quantity, because the industries with captive power will not use PDB’s supply. There will be surplus power available at the peak hours. Load management under these circumstances by both power and gas sectors will be a problem technically as well as financially. For the gas sector, there will be large differences among peak demand, average demand and connected load. Such large differences are undesirable from commercial view  point and this is certainly wasteful resource wise.

8.3 Domestic Sector (Cooking Fuel)

The consumption of gas in the domestic sector as a cooking fuel will continue to rise, Table 6.4 and Figure 8.1. However, the four transmission and distribution companies including the newly formed company the Pashchimanchal Gas Company Ltd. (WES GAS) would be able to provide gas connection to about 70,000-75,000 households per year provided the funds for the expansion of pipeline network are available. This additional connection means additional gas demand of about 6.4 MMSCFD based on daily consumption of 82 SCF per connection. This will give rise to an annual increase of gas consumption by this sector by 2.33 BCF. The trend is not going to change overnight just because the gas is available on the western bank of the river Jamuna. When the demand of the larger metropolitan areas like Dhaka and Chittagong will be fully served the sector will find the growth diminishing. The current growth has little bearing on the growth of economy or GDP. Because having a gas connection is an option for replacing the existing fuel type in use leading to convenience and comfort of cooking.

FIGURE 8.1: GAS CONSUMPTION BY DOMESTIC SECTOR (1990 – 2000)
AS SERVED BY THREE COMPANIES

8.4 Industry Sector

The consumption of gas in the industry sector will continue to rise in the franchise areas of TGTDCL, Table 6.3 and Figure 8.2. The franchise areas under WES GAS will show some initial growth like that shown by BGSL and JGTDCL, Table 6.3 and Figure 8.2.

Adding the system loss of 55 MMSCFD to this sector is a distortion. This has not led to additional sale revenue not to speak of proportional increase.

The consumption in the franchise areas served by BGSL and JGTDCL has remained static during the current decade 1991-2000. No growth is noticeable, Figure 8.2. Probably the potential industries were served as soon as the gas had become available.

FIGURE 8.2: GAS CONSUMPTION BY INDUSTRY (1990 – 2000) AS SERVED BY THREE COMPANIES

FIGURE 8.5 :GAS CONSUMPTION BY INDUSTRY IN TITAS FRANCISE AREA  
(Total and excluding captive power generation, 1980-2001)

Since the actual consumption in different franchise areas by the three older distribution companies are known, it would be useful to study the customers industry wise and uses of gas to understand the potential of this sector. This would provide a realistic basis for future planning of this sector.

The gas of Bangladesh contains more than 94% methane by volume. Its suitability as a feed stock for petrochemicals is not promising. It does not have technological edge over other raw materials used for petrochemicals worldwide and it is not considered as a potential raw material for petrochemical industry.

8.5 Commercial Sector and Seasonal Users

In 1998, the commercial sector used about 1.62% of the total gas consumption. The growth of this sector will remain slow. Similarly, the growth for the seasonal users will also remain slow.