Emerald Oil Industries, the manufacturer of Spondon-branded edible oil, has announced that it is temporarily suspending its operations due to an ongoing shortage of gas supply to its factory.

The disruption in gas supply has significantly affected the production process, forcing the company to suspend operations and operate below full capacity, according to a disclosure made to the stock exchange on Thursday.

In an effort to resolve the issue and resume normal production, the company has imported a 12 MT capacity, 17.50 high pressure boiler, which is currently being installed in the factory. The company plans to resume operations once the installation is complete and the new boiler is operational.

Despite the production shutdown, Emerald Oil has assured its employees and investors that there have been no redundancies during this period, and the company is retaining its workforce while working to resume full operations.

According to Bangladesh Securities and Exchange Commission (BSEC) officials, the region has been facing an acute gas crisis for several months, which has directly affected Emerald Oil’s ability to maintain its normal production levels.

The lack has meant that the company cannot function properly, forcing it to suspend operations. However, the company’s management had not previously disclosed this ongoing issue to its general investors.

In January this year, the company received regulatory approval to pledge shares as collateral for a loan, raised from the mandatory 30% owners by sponsor directors, to meet its working capital needs.

Minori Bangladesh, which owns 38.26% of Emerald Oil, acquired 7.81%, or 46.66 lakh shares, from the secondary market, while the rest was raised through issue of new shares.

BSEC has permitted the company to pledge its sponsor shares without a lock-in period, although certain conditions must be met.

A letter from BSEC noted that Minori Bangladesh is prohibited from pledging or using its 30 percent holding as collateral or margin, and all newly issued shares will remain for a three-year lock-up period, with restrictions on pledging or encumbrance of those shares.

Minori Bangladesh, a subsidiary of Japan’s Minori Co. Limited, took over Emerald Oil in 2021. As of yesterday, the company’s shares closed at Tk 24.90 on the Dhaka Stock Exchange.

Established in 2008, Emerald Oil began producing Spondon-branded rice bran oil in 2011 and went public in 2014.