The state-run petroleum corporation has finalised a design to build a new crude oil refinery in Chattogram with a capacity of 3.0 million tonnes per year.
Bangladesh Petroleum Corporation (BPC) recently approved the front-end engineering design (FEED) three years after initiating the move.
French firm Technip drafted the design.
The FEED was finalised after consulting Engineers India Limited (EIL), BPC director (operations and planning) Sayed Mohammad Mozammel Haque told the FE on Tuesday.
An engineering, procurement and construction (EPC) contractor would now build the refinery, he said.
After finalising the FEED, Mr Haque said Technip showed interest to build it as an EPC contractor.
The Indian consultant has revised the estimated project cost at $1.8 billion (180 crore).
Technip, however, estimated the cost at $2.8 billion, calculating labour cost and relevant expenses in European standard, Mr Haque mentioned.
Technip initially signed a memorandum of understanding (MoU) with the BPC on November 11, 2015, to build the plant aimed at trebling the refining capacity to 4.5 million tonnes per year.
The country's current crude oil refining capacity is 1.5 million tonnes per year, the BPC official said.
The French firm subsequently sent technical and financial offers to the BPC on December 20, 2015, to implement the project.
To expedite work, the BPC on April 19, 2016, assigned the EIL as a project management consultant (PMC).
The BPC will have to pay around Tk 1.61 billion against PMC fees, which include $16.54 million plus Tk 82.28 million inclusive of local taxes, within three years.
Mr Haque said the corporation on January 18, 2017, assigned Technip to carry out the FEED for the proposed refinery at Tk 2.57 billion ($32.10 million).
Technip submitted a draft FEED in March 2018.
Once implemented, the refinery could help the country save $220 million every year, BPC officials said.
Currently, Bangladesh imports around 7.50 million tonnes of crude and refined petroleum products every year to meet the local demand.
The BPC purchased land from industries ministry at Tk 2.30 billion for the project.
Officials said the refinery could enable the country to process any type of crude oil and it might make Bangladesh a refined petroleum product exporter.
Nepal has already shown interest to import refined petroleum products from Bangladesh and agreed to ink an MoU in this regard, Mr Haque said.
The surplus finished petroleum products could be exported to Sri Lanka, Bhutan, Myanmar and the north-eastern parts of India as well, the officials said.
A consortium of three French companies, led by Technip, had installed the first unit of the ERL, the country's sole refinery, having the refining capacity of 1.5 million tonnes per year.
The first unit started commercial operation in the port city in 1968 with 30 years of economic life.
It is still in operation having a derated capacity of around 1.4 million tonnes a year.
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