smuggled LPG Imports and Allegations
Smuggled LPG shipments are reaching Bangladesh at low prices, while companies are selling them at higher prices. Furthermore, there are allegations that LPG is being imported from Iran via Iranian ports, and that this is being done in violation of regulations.
Since January of this year, approximately 22 billion dollars has been allegedly siphoned off through the illegal import of LPG. The Executive Director of the Transparency International Bangladesh (TIB), Dr. Iftekharuzzaman, has called for a thorough investigation into this matter.
Two Iranian-flagged vessels, carrying LPG, were docked in the outer anchorage of Chittagong Port. Allegations have emerged that a leading business entity in Chittagong was illegally importing LPG from Iran via these two vessels. The LPG Operators Association of Bangladesh (LOAB) has raised this complaint, which has been submitted to the Chairman of Chittagong Port Authority, the Governor of Bangladesh Bank, and the Advisor to the Ministry of Shipping.
The LOAB alleges that a group based in Chittagong is importing and marketing LPG illegally from Iran, often via Iranian ports before onward shipment to Iraq and subsequent re-import into Bangladesh. The organization claims that approximately 256,000 tons of LPG has been illegally imported between January and August, representing $175 million in illicit funds transferred abroad.
The company involved in these illegal imports has allegedly used several banks to open Letters of Credit (LCs) for the import of LPG. Despite prior notification to Bangladesh Bank, no action was taken.
The LOAB has identified two specific vessels: the GJYMM and Captain Nicholas. The GJYMM vessel has an IMO number of 9139696, while Captain Nicholas has an IMO number of 9008108. These vessels were involved in the suspected illegal trade.
Imported LPG from Iran lacks a distinctive odor, posing a significant risk of undetected leaks. This deficiency violates the regulations stipulated by the Ministry of Power, Energy and Mineral Resources, which mandates that imported LPG must contain a detectable odor.
However, Basra Gas Company officials in Iraq claim they are the only authorized Iraqi company exporting LPG via the Um Qasr Port. They state that the GJYMM vessel did not load any LPG on it, and that Basra Gas Company did not load any LPG on it either. A certificate of confirmation was attached to the letter from Basra Gas Company.
The allegations indicate that the imported LPG suffers from inconsistent propene and butene (odorant) ratios, leading to quality issues and potential hazards. It is standard practice to add a detectable odor to imported LPG in Bangladesh, to facilitate detection of leaks.
The letter, signed by LOAB President Azam Jo Chowdhury, has generated considerable public concern. The letter highlights the presence of illegally imported LPG on the vessels GJYMM and Captain Nicholas, currently docked in the outer anchorage of Chittagong Port. A team led by Member Harbourer of Chittagong Port has inspected the vessels.
Port Authority Secretary Mohammad Omar Faruk confirmed receipt of the complaint. However, he declined to comment further.
According to the LOAB, the demand for Liquefied Petroleum Gas (LPG) is increasing in Bangladesh, used as a crucial and environmentally friendly fuel for household, commercial, and industrial applications. Approximately 1.4 million tons of LPG are imported annually from various countries, including Turkey, Qatar, and Africa, which are then bottled and distributed nationwide.
Only 2% of the LPG demand is met through local production at the ISTAR Refinery.
Source: Barterbazar/SM2
