Emerald Oil Industries PLC has once again missed its production restart deadline, as delays in obtaining an electricity connection and a seasonal shortage of rice bran, its main raw material, have stalled the listed company's plan to resume commercial operations.
The company had expected to restart production by 30 September 2026, but the deadline passed without operations resuming. It is also holding back production during the current off-season because of insufficient raw material, according to a disclosure published on the Dhaka Stock Exchange (DSE) today (15 October).
The share price of the company closed at Tk27.90 on the Dhaka Stock Exchange today.
Emerald Oil said recent electricity shortages in rural areas and shortfalls in the national grid had delayed the required electricity connection from the Bangladesh Power Development Board (BPDB).
To facilitate the connection, the company has installed solar panels worth around Tk80 lakh and deposited approximately Tk50 lakh towards the connection costs specified by BPDB. However, it has not announced a revised date for resuming commercial production.
The company also said rice bran, its primary raw material for producing rice bran oil, becomes available in the market from November because of its seasonal nature. Limited supplies during the current off-season have therefore prevented it from starting commercial operations.
The latest delay follows an earlier disclosure on 30 July, when the company said it expected to resume commercial operations by the end of September.
Factory shut for more than two years
Emerald Oil's factory has remained closed since 1 January 2024, when the company suspended production citing inadequate gas supply.
In a disclosure on 8 July, the company said its board had authorised management to take the necessary steps to reopen the factory and carry out repairs and maintenance.
The planned work included purchasing and installing a new boiler, transformer and electrical substation, along with repairing and maintaining machinery, including the refinery unit. The company estimated that the work could cost around Tk10 crore.
Despite these preparations, the company has yet to restart production because of the electricity connection issue and the unavailability of sufficient rice bran.
Repeated shutdowns undermine recovery efforts
Established in 2008, Emerald Oil began producing rice bran oil under the Spandan brand in 2011 and was listed on the stock market in 2014.
The company suspended production in 2017 amid financial and business difficulties. It resumed trial production in late 2021 following investment from Minori Bangladesh Ltd, an associate of Japanese agricultural company Minori Co Ltd, before returning to full-scale production in January 2022.
However, the recovery proved short-lived as gas shortages, raw material constraints and financial difficulties continued to affect operations.
In September 2023, Emerald Oil, Minori Bangladesh and Jamuna Edible Oil signed an agreement to increase rice bran oil production. Under the plan, Jamuna Edible Oil's facilities would be used to process crude rice bran oil, with a target of raising daily production to 160 tonnes by processing 800 tonnes of rice bran a day.
The subsequent suspension of operations and business difficulties, however, disrupted the company's recovery plans.
Financial disclosures not updated
The prolonged shutdown has been compounded by the absence of updated financial information. According to the information provided, Emerald Oil has not published financial statements since January 2023, leaving investors without a clear picture of its current financial position, liabilities and ability to finance a production restart.
The company's shares are currently traded in the Z category on the DSE. General investors hold 41.04% of its shares.
The lack of recent financial statements makes it difficult for investors to assess the company's performance and recovery prospects, particularly after more than two years of suspended production.
For Emerald Oil, securing a reliable electricity connection, ensuring adequate supplies of rice bran and completing factory repairs will be crucial to restarting operations.