BPC to save $2.91m on fuel imports over six months
The government is set to import about 1.18 million tonnes of petroleum products from two Singaporean companies under competitive bidding -- a move that will save the public exchequer about $2.91 million.
The premium, which is the cost of shipping petroleum products and includes freight charges and insurance, will be $2.16 to $2.08 per barrel for gas oil and $2.76 for jet fuel for imports between January to June next year.
In contrast, under the open tender that took place in April for the first time since 2005, the premium stood at $2.37-$2.57 per barrel for gas oil and $3.06-$3.54 for jet fuel.
The development comes after the cabinet committee on economic affairs yesterday approved Bangladesh Petroleum Corporation's proposal to purchase 965,000 tonnes of gas oil from Unipec Singapore Pte.
The company will also supply 90,000 tonnes of jet fuel. Besides, the committee also approved a proposal for importing 120,000 tonnes of furnace oil through open bidding process. Singapore-based Vitol Asia won the contract by offering a premium of $15.8 per tonne.
The petroleum price is always as per the market rate but various quarters raised questions about whether the premium was being fixed properly, said an energy ministry official.
“That is why the cabinet committee directed the BPC to purchase half of the annual fuel requirement through open bidding.” In December last year, the cabinet committee on purchase decided that 50 percent of the petroleum imports made in a year will be through open tender and the other 50 percent through government-to-government deals.
After Bangladesh introduced the bidding system, the premium for government-to-government deals came down as well.
In September, the purchase committee approved importing petroleum products under government-to-government arrangement from July this year to March next year. The premium price of gas oil was $2.3 per barrel.
For instance, the BPC has been negotiating rates with Kuwait Petroleum Corporation for premium that is $0.07 to $0.06 lower than that received in the open tender.
The BPC imports about five million tonnes of petroleum products annually at a cost Tk 50,000 crore to Tk 60,000 crore.
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