Bangladesh seeks Indian Oil help
Team To Visit Dhaka To Help Sort Out Fuel Import Issues
The Bangladesh government
has called state-owned Indian Oil Corporation to discuss the modalities for expanding the present trade in diesel, co-operation in
refinery revamp and construction of coastal fuel import and
handling facilities.
A team from Indian Oil is to visit Dhaka next month for talks with officials, including counterparts from Bangladesh Petroleum Corporation .The agenda includes discussion on pricing of diesel being exported ,revamp of the two-million –tonne capacity Chittagong refinery and construction of a diesel/petrol import terminal at Mangla
Bangladesh currently imports roughly 1.6 million tonne of petro products per year, mainly from Kuwait which gives special discounts. Indian Oil supplies 200,000 tonne of diesel, cheaper than the Kuwaiti product .The discussions are likely to weigh a revision in price and increase Indian Oil’s share.
The Bangladesh government has also shown interest in Indian Oil’s participation for revamping the country’s lone ageing refinery at Chittagong. Along with that ,it wants Indian Oil to set up crude/fuel import and handling facilities at Chittagong and Mangla
Transportation charges cost Bangladesh over $1 per barrel extra because it lacks handling facilities. Since Chittagong port, the lone petro products import route, does not have water depths to accommodate large vessels, supplies are moved in smaller ships from the large carriers anchored in the high sea, increasing the handling costs.
Transportation costs also impact the price of the Chittagong refinery’s output because both imported and domestic products are moved in barges to Khulna, from where are loaded on train tankers for upcountry distribution.
Indian Oil had proposed exporting diesel from the Haldia refinery in barges to Khulna, a distance of 90 miles .This way, Bangladesh can save in transportation costs .Another option is supplies by rail tankers directly to Rajshahi from Malda in Bengal.
Indian Oil is already revamping the Trincomalee tankage facilities in Sri Lanka where it is exporting 30,000 tonne of diesel and 10,000 tonne of jet fuel besides running 300 retail outlets.
Haldia port handles more than 10 million tonne of traffic for Indian Oil about six to seven million tonne of crude and another three to four million tonne of products.