Project detail - OMERA PETROLEUM LIMITED

Who is our customer

Omera Petroleum Limited (OPL) in Bangladesh is a company that imports, stores, bottles and distributes liquefied petroleum gas ("LPG) throughout Bangladesh. OPL sources its LPG on the global market. The company will mainly target domestic use as it is considered one of the safest, eco-friendly and healthy cooking fuels. OPL is one of the subsidiaries of a strong and reputable energy player in Bangladesh and benefits from its sector and market experience and established brand..

What is our funding objective?

In 2015, FMO has financed and invested in the development and construction of 4 LPG plants with a local capacity of 100,000 ton/year. Total project costs amount to approximately US$60 million. The funding was used for the construction of the main terminal, the three satellite plants and the distribution network. The main terminal is located in Mongla (close to one of the country's principal seaports) where the LPG is delivered and then redistributed to the three satellite bottling plants located in Dhaka, Bogra and Chittagong and further on to private and commercial users. In 2018 FMO participated in the capital increase of Omera, which was used to finance the further expansion of Omera.

Why do we fund this investment?

LPG can be used for cooking, heating, electricity generation, transportation (autogas), refrigerating and many other industrial and commercial applications. Given the lack of natural gas in rural and urban areas in Bangladesh due to the fast growing economy, households are looking for alternatives for cooking. LPG is a more expensive alternative for cooking compared to charcoal and kerosine but the health and environmental benefits easily outweigh the cost, for those who can afford it. By engaging in this transaction, FMO contributes to the positive impact that LPG has on the health and productive time consumption on local Bangladeshis, especially women and children.

What is the Environmental and Social categorization rationale?

E&S Category is B+, as the project poses environmental and social risks which are mitigatable though well-known and available mitigating measures. This investment triggers IFC PS 1-4, with safety aspects being the most important ones during operation and transportation of LPG, as it is a highly flammable substance. PS 5 is not triggered as no additional land was acquired since the initial establishment of the company. PS 6 is also not triggered as the sites are situated within industrial areas, and (former) agricultural areas. Mongla plant is situated about 7 km far from the Sundarban National Park. This distance is very large considering the limited environmental impacts that the OPL plant might cause. PS7 and PS 8 are also considered not to be triggered as no indigenous people or cultural heritage sites are negatively impacted by the project.

More investments

Date	Total FMO financing
9/3/2018	BDT 157.03 MLN
12/19/2014	USD 9.50 MLN