Dhaka: After last few days’ fall in gas production, the supply situation has started improving following a ‘transitory understanding’ between the government and the private refineries on condensate receiving.

According to official sources, over a discrepancy about the condensate price, the private gas companies have been refusing to receive condensate from the gas fields which forced authorities to reduce production.

On 8 March this year, the government reduced all kinds of petroleum products by 8% to 35% for the products produced locally by different refineries. At present, some 12 private refineries are operating in the country. They buy condensate from the gas fields and produce different petroleum products including octane, petrol, diesel, and kerosene.

Subsequently, the price of condensate was also reduced from Tk 58 to Tk 42.47 for per litre of heavy condensate and Tk 53.08 for thin condensate.

Being dissatisfied with the government price cut decision, a group of companies filed case against the new price and a court also suspended the government’s price cut decision.

Secondly, some of the companies also stopped receiving condensate from the gas fields which the fields produce as by-product.

Once the refineries refused to receive condensate from gas fields, the gas field authorities were forced to reduce gas production as they usually face problem in storing the extra condensate.

At this stage, the largest gas field, Bibiyana, has to reduce the gas production to 800 million cubic feet per day (mmcfd) from 1,200 mmcfd.

This resulted in overall shortage in gas supply to power plants, industries and also to CNG filling stations. Household consumers in some areas also had to experience pressure-fall in gas discharge at the point of use.

However, despite fall in gas supply, the Power Development Board (PDB) managed normalcy in power production by increased generation in fuel-fired plants, but the CNG stations and industries had to suffer a lot. After continuation of such situation for more 10 days, the government moved to resolve the problem.

State Minister for Power and Energy Nasrul Hamid on Saturday held meetings with Petrobangla and BPC officials and directed them to resolve the problem through discussion with refinery operators.

The Petrobangla officials and refineries operators reached a temporary understanding to resume receiving condensate from the gas fields.

After the decision, they increased receiving of condensate to 5500-6000 barrels from 4,000 barrels. As a result, Chevron also increased gas production to 1,130 mmcfd from last few days’ 800 mmcfd, said Petrobangla officials.

Managing director of Sylhet Gas Fields Limited, who deals with the matter, said they resolved the condensate issue through discussion.

‘We’ve reached understanding and now there is no problem in supply of gas or condensate,’ he told UNB.