Future Energy Source Company Limited (FESCO) is currently working to resolve a minor regulatory issue at its Bernard Lodge liquefied petroleum gas (LPG) facility, following the denial of an environmental permit renewal by the National Environment and Planning Agency (NEPA). According to managing director Jeremy Barnes, this issue stems from a missing lease document, which the company is actively working to rectify.
Earlier this month, NEPA declined FESCO’s application for the environmental permit renewal, citing the “non-submission of proof of lease agreement or ownership of site.” This permit is essential for the continued operation of the company’s LPG plant, which serves as a key part of FESCO’s foray into the cooking gas market. The company submitted its application in November 2023, marking its first renewal request for the Bernard Lodge plant since it acquired the facility from Wilson Beck LPG Limited in April of the same year.
The plant, originally launched in May 2020 by Wilson Beck, plays a crucial role in FESCO’s efforts to capture market share in the Jamaican LPG industry, which is currently dominated by Massy Gas’s brands, Gas Pro and IGL. These two brands hold a commanding 70 percent of the market. FESCO, through its own LPG brand, FesGas, aims to challenge that dominance and expand its presence.
Ownership of the land where the LPG plant is located belongs to the Sugar Company of Jamaica, according to records from the Office of Titles Jamaica. The previous lease held by Wilson Beck remains officially registered, and FESCO inherited the arrangement as part of the acquisition. Despite the existing lease, NEPA’s request for proof led to the temporary permit denial.
Barnes remains optimistic about resolving the issue swiftly, stating that the company will submit the required lease document shortly. “This is simply a renewal of a previously approved permit. NEPA misplaced the lease document, and we are already in communication with them to submit it,” Barnes explained. Insiders suggest FESCO may explore purchasing the land in the future to avoid similar issues.
Despite the regulatory hiccup, FESCO’s LPG business continues to gain momentum. Since acquiring Wilson Beck’s assets, the company has made significant strides in establishing itself in the competitive LPG sector. The Bernard Lodge facility is a core element of this strategy, and its FesGas brand has already exceeded initial sales expectations.
For the 2023/24 financial year, FESCO reported $590 million in LPG sales, contributing just over 2 percent to its overall revenue of $28.7 billion. While petroleum remains the company’s mainstay, distributed through over 20 service stations island-wide, the LPG segment has shown promising early growth. In fact, although FESCO officially entered the LPG market in April 2023, much of its growth came in the latter half of the year, starting in October.
As part of its expansion strategy, FESCO invested $1.4 billion during the 2022/2023 financial year to establish new LPG filling plants in locations such as Naggo Head, Discovery Bay, and Stony Hill. However, for the current fiscal year, the company has scaled back capital expenditure to $270 million while continuing to focus on expanding its LPG operations.
While the company resolves the final regulatory requirements, FESCO is positioning itself as a strong competitor in Jamaica’s LPG sector. Barnes emphasized that continued growth in this segment will require additional capital to remain competitive and meet growing demand. Despite the regulatory delay, FESCO remains confident in its vision for long-term success in the LPG market, supported by strategic investments and an expanding customer base.
