Bangladesh’s apparel makers have been facing one of the country’s worst bouts of gas shortages, which has disrupted production in 350 units in Dhaka and its vicinity, with no immediate let-up in sight.
With gas power plants supplying 70% of Bangladesh’s electricity, power cuts have halted production. Many factories have captive power plants which run on gas. But it is also used in Bangladesh’s garment factories for directly heating irons, boilers, steaming, washing and denim production processes.
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Industry leaders told just-style that garment factories in Gazipur, Konabari, Savar and Kashimpur are struggling to meet buyers’ shipment deadlines and are opting for expensive air delivery to save time.
“The gas shortage has worsened again in the past three days after an improvement for a week,” said Siddiqur Rahman, president of the Bangladesh Garment Manufacturers and Exporters Association, the industry lobbyist group. “The entire sector is affected,” he told just-style.
For more than a month, the apparel belt has been hit by the shortage in local gas production and supplies, which has been worsened by damage to two wells of the key Shahjibazar gas field, in Brahmanbaria. “Gas pressure is nowhere. Gazipur and Konabari are the worst affected,” Rahman said. Only a handful of people are getting gas in their factories, he said without naming those few businesses.
Confronted with the situation, the BGMEA has been talking to the Government’s Power, Energy and Mineral Resources Ministry, asking its officials to take action. But the Government’s response is that there is no quick-fix.
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By GlobalData“We don’t have gas. That’s why gas pressure has plunged,” Bangladesh’s Junior Minister for Power, Energy and Mineral Resources, Nasrul Hamid, told just-style.
He said textile and apparel industry entrepreneurs may have to wait until April for regular supplies when imported LNG (liquefied natural gas) will be made available to make up the shortfall in supplies.
The country’s first floating LNG terminal, with a capacity to store and re-gasify 3.75m tonnes of imported LNG a year, is scheduled for commissioning in April 2018. The US-based Excelerate Energy is building the terminal.
In September, state-run Bangladesh Minerals, Oil and Gas Corporation (BMOGC) signed a 15-year agreement with Qatar’s RasGas to secure annual supplies of 2.5m tonnes of LNG. “LNG is coming. There will be no crisis then,” Hamid said.
