The government stands guarantor in favour of the Bangladesh Petroleum Corporation (BPC) for importing about 0.36 million tonnes of petroleum products for the next January-June period under deferred payment, officials said.
Under the guarantee, the BPC will import around 0.36 million tonnes of refined petroleum oil from four suppliers during the first six months of 2015. The suppliers are: Petronas Trading Corporation Sendirian Berhad (PETCO) of Malaysia, Petro-China Company Limited of China, Philippine National Oil Company (PNOC) Exploration Corporation of the Philippines and UNIPEC Singapore Pte Ltd, they said.
In August, Standing Committee on Non-Concessional Loan of the government approved the deferred payment deal worth US$ 300 million from PETCO-Malaysia, US$ 250 million from Petro-China, US$ 200 million PNOC-Philippines and US$ 150 million UNIPEC-Singapore for 150 days with a 3.78 per cent annual interest rate for the fiscal year (FY) 2014-15, according to the BPC data.
The state-run fuel importer is utilising some US$ 300 million out of US$ 900 million until the current month of December, the BPC data showed.
Some US$ 400 million may be spent to meet the country's liquid fuel demand for January to June, 2015 which was approved at the last meeting of the Standing Committee on Non-Concessional Loan held in the ministry of power, energy and mineral resources. Md Abu Bakar Siddique, Secretary of the Energy and Mineral Resources Division presided over the meeting.
Some US$ 200 million out of US$ 900 million may be utilized for July to December, 2015, data also mentioned.
"The BPC will have to inform in details before using stated deferred payment (US$ 400 million) for January-June-2015 to the committee concerned of the ministry of power, energy and mineral resources," a high official of the ministry told the FE Sunday.
"We are now making some profit against sale of different fuel oil. If the price remains at this level, we will definitely make profits at the end of the fiscal year, an official of BPC told the FE.
However, he said the BPC was using the deferred payment mechanism to import petroleum products due to a significant amount of bills remain outstanding with some organisations.
"The BPC will import about 60000 metric tonnes of petroleum products per month under the deferred payment facility from four international suppliers. It will be continued to next June, 2015" Moni Lal Das, deputy general manager (finance) of the BPC said.
The BPC has been earning a net profit worth around Tk 2.0 billion per month since October, 2014. The profit might increase further in the coming months as the oil prices have lowered to US$61 per barrel now on the global market, sources said.
"The BPC is making Tk 1.70 profit per litre of diesel and kerosene after payment of VAT and other duties while it also earns Tk 4-5 profit per litre on furnace oil sales. Besides, it also got profit of around Tk 12 per litre on Octane, they said.
The BPC is likely to start talks with Islamic Trade and Finance Corporation (ITFC) and other international lenders to get loans at lower rate of interest, sources said.
The entity borrows from various agencies and banks for this purpose including International Islamic Trade Finance Corporation (ITFC), the lending arm of Islamic Development Bank, and from international banks like HSBC, Standard Chartered and Citibank.
The BPC has fixed a target to import petroleum products of 5.6 million tonnes for the current FY. It was 5.35 million tonnes in the previous FY.
Bangladesh government stands as the guarantor against the deferred payment schemes.
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