Among the countries in Asia, Bangladesh has been known for its natural gas consumption for several years. Since the natural gas reserves are depleting day by day, the LPG industry is growing at a rapid pace in the country. The government has also realised that the need for alternative energy sources can be met by increasing the number of LPG service providers and supporting the LPG tank manufacturers in Bangladesh.
Liquefied Petroleum Gas or LPG is a popular alternative to natural gas. Propane and Butane are the main constituents of LPG. LPG, also known as auto gas, is used for a variety of purposes in areas such as constructions, sailing, agriculture, hospitals and so on. Due to the low amount of heavy metals and lead-free content in its chemical composition, LPG is also considered a greener alternative to natural energy resources.
Bangladesh Petroleum Corporation (BPC) began supply of LPGs in Bangladesh in the 1980s.With a large number of private players entering the LPG markettoday, there will be a rise in the number of LPG bottling plants and LPG tank installations. LPG filling stations installation will be set up in many regions too. As per the recent report by World LPG Association (WLPGA), the demand for fuel in Bangladesh will reach 3.0 million tonnes by 2025.
Factors driving the LPG industry’s growth in Bangladesh:
- Rising demand for LPG among consumers
Bangladesh is a growing economy. The income level per family is rising too. With natural gas shortage in future, the demand of LPG services will increase. LPG prices are affected by global fuel prices. Government subsidies can be a relief for private players to offer competitive prices for LPG services. Also, the increasing earning potential of the people will make it easier for them to switch to LPG usage.
- Government Initiatives for auto LPG
Other than LPG tank installation for households, there is opportunity for LPG tank manufacturers in Bangladesh in the automobile sector. The Bangladesh government has already released the rules and regulations for auto LPG conversion centres and auto LPG filling stations. These initiatives will encourage switching from CNG to LPG for automobile owners in Bangladesh.
- LPG licenses for private companies
When the demand for LPG increases in the market in the future, there will be a number of LPG service providers for consumers to choose from. The Bangladesh government has already granted licenses for LPG services to over thirty private operators.
- Opportunities in rural markets
Other than rising demand for LPG in urban markets, there is untapped potential in the rural markets. There are rural areas in Bangladesh where piped gas services have not reached yet and the existing energy supply may not be enough. This also means that there is immense opportunity for LPG vaporizer manufacturers and LPG tank manufacturers in Bangladesh.
Bangladesh is one of the rapidly growing developing countries in Asia. There are several private companies including LPG tank manufacturers who look forward to increase their plant capacities and upgrade their operations. Operational efficiencies will lead to better customer services in a competitive LPG market of the future.
While the LPG market in Bangladesh grows, there will be need for high-quality engineering products as well. Outsourcing of these LPG products from reputed global players will help reduce the cost of LPG filling stations installation.