A costly delay
It is very unfortunate that the project to treble the capacity of Eastern Refinery Limited, a subsidiary of the state-run Bangladesh Petroleum Corporation, once intended to refine 4.5 million tonnes of crude oil a year and save more than $220 million spent every year on the import of refined liquid fuel, is yet to see the light of day even 10 years after efforts in this regard had started. As New Age reported on Saturday, the Energy Division planned in 2003–04 to implement the project with funds from international lending agencies but to no avail. Then, four years ago, with a government decision to explore the possibility of public-private partnership to make the project a reality, the contract was given to a local private firm-led consortium though only to scrap the deal later with the discovery by the Energy Division that the funding bank based in the United Kingdom hardly owned the capacity to fund a $1.3 billion project.
In 2011, the BPC authorities gave the contract to the same consortium reportedly selected through a tender process in which 17 firms participated. This time, the consortium quoted around $0.9 billion to implement the project on a build-own-operate-transfer scheme including the condition of the sharing of 48.9 per cent of the profit by the contractor for nine years and a half. But, again, the Energy Division asked the corporation to cancel the deal on the same plea shown on the earlier occasion. Not only that, the ministry also came up with a fresh project abandoning the last one, that too, blaming that the latter, meant for balancing, maintenance, rehabilitation and expansion of the refinery, does not suit the actual purpose of the project, apparently in a show of its key figures’ dismal efficiency as they took a decade to locate the alleged flaw. The less said about the lack of coordination among the people high up in the ministry and the corporation, perhaps, the better.
Either way, in line with the new proposals drafted by the corporation, as its chairman told New Age, a second unit at the refinery is to be set up in the next three financial years with government funds to enhance its capacity to refine three million tonnes of crude oil a year. It is hoped that the top brass of the energy ministry will redouble their efforts to this end. After all, the project directed to reduce the fuel oil cost per litre by Tk 6 to Tk 7 from the current level is also crucial for a public respite, at least partly, from the living cost fuelled by repeated increase in prices of liquid fuels during the last three and a half years or so in the incumbents’ bid to adjust the rising import bill for refined petroleum products.
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