Govt to raise fuel import to meet soaring demand
Saturday, 2 January 2010
M Azizur Rahman
The country will import around 4.30 million tonnes of fuel worth around US$ 2.64 billion (Tk 184.87 billion) in 2010 to meet the soaring domestic demand, which is 16.21 per cent higher than the consumption level of 2009, officials said.
The state-owned Bangladesh Petroleum Corporation (BPC) imported around 3.70 million tonnes of fuel, both refined and crude, for the consumption in 2009, BPC chairman Anwarul Karim told the FE Tuesday.
He said the augmented quantity of fuel would be used mainly to run the government's new oil-based power plants next year.
A senior energy ministry official said arrangement of funds for the additional quantity of fuel would be a major challenge for BPC next year.
The Jeddah-based Islamic Development Bank (IDB) is currently the major lender for the corporation, which provides around $800 million annually to foot the fuel import bills, said the ministry official.
He said BPC is now searching for new sources to arrange additional funds.
Officials said, of the total fuel requirements for the next year, the government already approved deals with different overseas sources to bring in around 4.08 million tonnes of fuel for 2010.
The BPC would import 1.4 million tonnes of fuel from Petco, the trading arm of Malaysia's national oil company Petronas.
The corporation would import 920,000 tonnes of diesel and 130,000 tonnes of jet fuel from the Kuwait Petroleum Corporation (KPC), they said.
The corporation would import 240,000 tonnes of diesel form Egypt 's Middle East Oil Refinery or MIDOR.
It would import around 180,000 tonnes of diesel from Philippine National Oil Company (PNOC).
The corporation would import 700,000 tonnes of crude oil from Abu Dhabi National Oil Company (ADNOC) of the United Arab Emirates (UAE), and 600,000 tonnes from the Saudi Arabian Oil Company (SAOC) of Saudi Arabia, it was learnt.
Apart from Petco's parcel, the premium rates for all other sources have been set at $3.9 per barrel over mean of Platts Arab Gulf assessments (MOPAG) for diesel and at $4.9 per barrel for jet fuel.
Petco's premium rate as agreed is $4.70 per barrel for diesel and $6.25 per barrel for jet fuel.
The BPC has also completed negotiation to import around 120,000 tonnes of diesel from the Maldives National Oil Company in 2010.
Currently, 34 per cent of the total imported diesel or around 800,000 tonnes of diesel is used for running shallow-pumps during irrigation.
The new fuel-based power plants would consume around 18,750 tonnes of diesel every month from the dates of their operation, said a BPC official.
The government has decided to build a total of 18 fuel-run power plants to generate 1360 megawatts (mw) of electricity within the next two years.
Bids for five of these plants to generate 330 mw of electricity already got government approval and they are scheduled to initiate operation within next several months.
Sponsors for the remaining thirteen power plants would also be selected shortly, a senior power ministry official said.
The country will import around 4.30 million tonnes of fuel worth around US$ 2.64 billion (Tk 184.87 billion) in 2010 to meet the soaring domestic demand, which is 16.21 per cent higher than the consumption level of 2009, officials said.
The state-owned Bangladesh Petroleum Corporation (BPC) imported around 3.70 million tonnes of fuel, both refined and crude, for the consumption in 2009, BPC chairman Anwarul Karim told the FE Tuesday.
He said the augmented quantity of fuel would be used mainly to run the government's new oil-based power plants next year.
A senior energy ministry official said arrangement of funds for the additional quantity of fuel would be a major challenge for BPC next year.
The Jeddah-based Islamic Development Bank (IDB) is currently the major lender for the corporation, which provides around $800 million annually to foot the fuel import bills, said the ministry official.
He said BPC is now searching for new sources to arrange additional funds.
Officials said, of the total fuel requirements for the next year, the government already approved deals with different overseas sources to bring in around 4.08 million tonnes of fuel for 2010.
The BPC would import 1.4 million tonnes of fuel from Petco, the trading arm of Malaysia's national oil company Petronas.
The corporation would import 920,000 tonnes of diesel and 130,000 tonnes of jet fuel from the Kuwait Petroleum Corporation (KPC), they said.
The corporation would import 240,000 tonnes of diesel form Egypt 's Middle East Oil Refinery or MIDOR.
It would import around 180,000 tonnes of diesel from Philippine National Oil Company (PNOC).
The corporation would import 700,000 tonnes of crude oil from Abu Dhabi National Oil Company (ADNOC) of the United Arab Emirates (UAE), and 600,000 tonnes from the Saudi Arabian Oil Company (SAOC) of Saudi Arabia, it was learnt.
Apart from Petco's parcel, the premium rates for all other sources have been set at $3.9 per barrel over mean of Platts Arab Gulf assessments (MOPAG) for diesel and at $4.9 per barrel for jet fuel.
Petco's premium rate as agreed is $4.70 per barrel for diesel and $6.25 per barrel for jet fuel.
The BPC has also completed negotiation to import around 120,000 tonnes of diesel from the Maldives National Oil Company in 2010.
Currently, 34 per cent of the total imported diesel or around 800,000 tonnes of diesel is used for running shallow-pumps during irrigation.
The new fuel-based power plants would consume around 18,750 tonnes of diesel every month from the dates of their operation, said a BPC official.
The government has decided to build a total of 18 fuel-run power plants to generate 1360 megawatts (mw) of electricity within the next two years.
Bids for five of these plants to generate 330 mw of electricity already got government approval and they are scheduled to initiate operation within next several months.
Sponsors for the remaining thirteen power plants would also be selected shortly, a senior power ministry official said.