Titas Gas Transmission and Distribution Company Ltd has blacklisted three international companies including two Chinese firms, accusing those of supplying faulty pipes.
It is also preparing to file a case against them.
Recently, the Energy and Mineral Resources Division of the power ministry communicated the matter through a letter to the foreign ministry so that it takes the issue up with the Chinese Embassy in Dhaka. The Business Standard has obtained a copy of the letter.
The companies facing the accusation are Chinese Hebei Changfeng Steel Tube Manufacturing Co Ltd and Henan Light Industrial Products I/E Xinxing Co Ltd, and the UK-based Intertek International Ltd.
Sources at the largest gas transmission company in the country said a project to set up an 8km gas pipeline had been taken up to supply gas from Gojariya Town Bordering Station to the Abdul Monem Economic Zone, a private economic zone, in Munshiganj.
The pipes imported from China for the project were produced by Hebei Changfeng Steel and supplied by Henan Light Industries.
The pre-shipment inspection of the imported pipes was done by Intertek International.
But the project authority identified leaks during the hydraulic test of the pipes last year after those had been shipped and installed.
Titas Gas then formed two committees to investigate the leakage.
The pipeline not fit for use
Both the probe committees reported that there were welding-related leaks in the pipes. The defects could be detected at the manufacturing stage through a test. Therefore, manufacturers and suppliers are responsible for supplying faulty pipes.
However, Gas Oil Orbit JV, a joint venture of Gas Oil Liners and Orbit Construction, that installed the pipes at the project site was not held responsible for the leaks.
Titas Gas officials, who oversaw the project, were also not linked to the defects or blamed for the poor implementation of the project.
The committees suggested blacklisting the Chinese companies in Bangladesh, so as to bar them from participating in any future pipeline projects here.
They also suggested blacklisting Intertek International for providing incorrect certification upon the pre-shipment inspection.
According to the probe reports, the pipeline should be abandoned because it has massive leaks.
A new pipeline to replace the faulty one
Titas Board decided to reconstruct the pipeline with money from the economic zone due to its liquidity crisis.
Md Shafiqul Islam, general manager (planning and development) at Titas Gas Transmission and Distribution Ltd, said they had started the initial work to float a fresh tender.
He did not disclose the cost of setting up the existing pipeline and the one that will replace it.
Meanwhile, businessmen are not showing any interest to invest in the economic zone for the lack of gas supply, said a source at the zone.
At present, the production of two large factories, including a pharmaceutical company, requiring a huge amount of gas, is being disrupted.
Titas Gas' Managing Director Ali Iqbal Md Nurullah refused to comment on the issue.