BPC to import over 1.0m tonnes of refined oil from Kuwait next year
Tuesday, 3 November 2009
FE Report
Bangladesh is set to import more than 1.0 million tonnes of refined fuel oil worth US$ 580 million from Kuwait by older vessels as usual next year as the state-owned Bangladesh Petroleum Corporation (BPC) completed a negotiation to this effect last week, officials said Sunday.
"We'll import 920,000 tonnes of diesel and 130,000 tonnes of jet fuel from the Kuwait Petroleum Corporation (KPC) in 2010 to meet the growing domestic demand," a senior energy ministry official told the FE.
The KPC has lowered the premium rate for diesel to $3.9 per barrel from the previous $4.9 and the rate for jet fuel to $4.9 from the previous $6.35, said the official.
But the KPC turned down a plea of the BPC to supply the fuel by vessels less than 20 years old.
The KPC stuck to its stance of shipping the fuel by vessels more than 20 years old and in turn cut the premium rate by over 20 per cent.
The Kuwaiti corporation also offered to supply fuel more than double the agreed quantity of around 2.1 million tonnes. But the BPC was not interested, as the KPC did not agree to supply the fuel by less than 20-years old ships.
A senior BPC official feared that shipping of the fuel by older vessels might lead to revival of the tussle between the two corporations over standard of the fuel.
The BPC might count a loss of $577,200 in the event of shipment of any substandard fuel, the official added.
The BPC had rejected KPC's jet fuel shipments twice since July last as the KPC supplies by ships more than 21-years old reached Bangladesh port in a 'substandard' state.
The KPC argued that it shipped the jet fuel from its port in the perfect condition.
Currently, Bangladesh has a term contract with Kuwait for supplying 60,000 tonnes of jet fuel and 360,000 tonnes of diesel during July-December, 2009.
The country resumed import of oil products from the KPC in July last after a gap of several months.
The KPC suspended supplies to BPC in April last as Dhaka delayed changing of a regulation that barred entry of vessels older than 20 years to its port.
Bangladesh later agreed to allow vessels up to 25 years old, while the KPC also agreed to accept letters of credit again from Bangladesh's state-owned commercial banks.
Bangladesh is set to import more than 1.0 million tonnes of refined fuel oil worth US$ 580 million from Kuwait by older vessels as usual next year as the state-owned Bangladesh Petroleum Corporation (BPC) completed a negotiation to this effect last week, officials said Sunday.
"We'll import 920,000 tonnes of diesel and 130,000 tonnes of jet fuel from the Kuwait Petroleum Corporation (KPC) in 2010 to meet the growing domestic demand," a senior energy ministry official told the FE.
The KPC has lowered the premium rate for diesel to $3.9 per barrel from the previous $4.9 and the rate for jet fuel to $4.9 from the previous $6.35, said the official.
But the KPC turned down a plea of the BPC to supply the fuel by vessels less than 20 years old.
The KPC stuck to its stance of shipping the fuel by vessels more than 20 years old and in turn cut the premium rate by over 20 per cent.
The Kuwaiti corporation also offered to supply fuel more than double the agreed quantity of around 2.1 million tonnes. But the BPC was not interested, as the KPC did not agree to supply the fuel by less than 20-years old ships.
A senior BPC official feared that shipping of the fuel by older vessels might lead to revival of the tussle between the two corporations over standard of the fuel.
The BPC might count a loss of $577,200 in the event of shipment of any substandard fuel, the official added.
The BPC had rejected KPC's jet fuel shipments twice since July last as the KPC supplies by ships more than 21-years old reached Bangladesh port in a 'substandard' state.
The KPC argued that it shipped the jet fuel from its port in the perfect condition.
Currently, Bangladesh has a term contract with Kuwait for supplying 60,000 tonnes of jet fuel and 360,000 tonnes of diesel during July-December, 2009.
The country resumed import of oil products from the KPC in July last after a gap of several months.
The KPC suspended supplies to BPC in April last as Dhaka delayed changing of a regulation that barred entry of vessels older than 20 years to its port.
Bangladesh later agreed to allow vessels up to 25 years old, while the KPC also agreed to accept letters of credit again from Bangladesh's state-owned commercial banks.