Power crunch hits ERL\\\'s output

M Azizur Rahman | Published: July 25, 2014 00:00:00 | Updated: November 30, 2026 06:01:00

Electricity supply problem in the country's lone crude oil refinery - the Eastern Refinery Ltd (ERL) - has been rampant recently, affecting its regular production and delaying export of refined petroleum products, industry insiders said.
The state-owned Bangladesh Petroleum Corporation (BPC), the parent company of ERL, had to cancel an international tender and re-offer it for selling naphtha as well as delay another one in the past three months due to lower-than-expected naphtha output, following the power supply crunch, a senior BPC official said.
Production of almost every refined petroleum product, including diesel, furnace oil, petrol, octane, jet fuel, kerosene, and liquefied petroleum gas (LPG), from the country's lone refinery declined due to the problem, he said. ERL's one 2.0 megawatts (MW)-capacity diesel-fired generator tripped in April last that caused slower pace in refining crude oil and less output of required quantity of naphtha.
BPC had to defer the tender, as it was not in a position to supply the offered quantity of naphtha to the best bidder - Vitol Asia - in due date because of the technical fault in electricity supply.
It had also informed Vitol about its inability to supply 170,000 barrels of naphtha for May 10-12 loading, and requested the company to take the naphtha supply in a deferred schedule for May 25-27 loading.
But Vitol had refused to take the naphtha supplies in the deferred date, which forced BPC to go for re-tender for selling naphtha in the international market. This is very rare for BPC, as it usually maintains tender schedule, he added.
Vitol had offered the most competitive bid to the Mean of Platts Singapore naphtha assessments, FOB, for the naphtha purchase, said another BPC official.
BPC delayed a mid-July tender again by five days to sell 170,000 barrels of heavy naphtha due to lower production at its sole refinery over electricity supply constraints, he also said.
"ERL informed us of its inability to supply the required quantity of naphtha due to a problem in the process plant."
This time 3-MW steam turbine generator at the refinery, which helps pump
crude to CDU, was in overhauling, resulting in lower output of refined product.
When contacted, a senior ERL official said the plant's old electricity generators are running at de-rated capacity, resulting tripping and electricity outages. These electricity generators require to be replaced with new ones.
"ERL does not take electricity from national power grid, as it has captive power plant."
He, however, said ERL is now running at its normal capacity after overhauling and repairing two of its electricity generators.
He said the power supply problems slowed down crude refining pace of ERL refinery in Chittagong, as the unit could not pump in required quantity of crude to the distillation unit.
The power supply crunch held back its output by around 15-17 per cent than its de-rated capacity of around 4,000-4,200 tonnes per day.
"We could send around 3,400-3,500 tonnes of crude per day to the distillation unit instead of regular 4,000-4,200 tonnes per day due to the problem," said an ERL official.
The lower refining of ERL, however, did not hamper the country's petroleum product supply chain that much. The country did not require importing additional refined oil due to the problem, he added.