MJL Bangladesh PLC, one of the leading private lubricant marketers, plans to invest $32.5 million, or Tk 350 crore, to purchase a newly-built tanker and provide rental services to private liquefied petroleum gas (LPG) companies.

The tanker, with a capacity of 11,000 cubic meters, a unit of measurement for the volume of the tanker, will transport LPG in a compressed form, said a top official of the company.

"We will purchase the vessel to transport imported LPG," said Rokibul Kabir, company secretary of MJL Bangladesh following a decision of the board.

On Monday, the board of directors of MJL Bangladesh, a joint venture between East Coast Group and state-owned petroleum marketer Jamuna Oil Ltd, approved the purchase of the tanker.

It approved an additional amount of $1.50 million for shipbuilding supervision fees, consultancy fees, modification-related spending, takeover expenses, legal fees and operational expenses, and travelling expenses, the company said in a disclosure to its shareholders today.

Kabir said they would purchase the vessel from Japan. And the vessel would be rented out to Omera Petroleum, and other LPG sellers in Bangladesh to generate revenue. 

The tanker is expected to be delivered by the shipbuilder by 2026.

Shares of MJL remained unchanged at Tk 86.7 a share as of 1.08 pm on the Dhaka Stock Exchange.

MJL Bangladesh decided to buy the tanker at a time when demand for bottled LPG is growing steadily for household use as the government stopped giving new piped gas connections. 

Now Bangladesh needs around 16 lakh tonnes of LPG per year and the total market size is around $3.2 billion in Bangladesh, according to industry people and a recent market assessment. 

At present, at least 30 LPG companies are operating in Bangladesh and Omera LPG accounts for nearly one-fifth of the market. 

A top official of a leading LPG company said some companies have their tankers but there are small ones. 

However, he said around 60 percent of companies use rented tankers to import LPG.