British firm to get $1b project

http://newagebd.com/newspaper1/frontpage/40679.html

British firm to get $1b project
Manjurul Ahsan

The government is likely to award a one billion dollar project to a British firm for trebling the oil-refining capacity of the state-run Eastern Refinery Limited.

A government official on Saturday told New Age that the Energy Division finally selected the proposal of Foster Wheeler as the best of the 17 proposals submitted for the project implementation.

The bids made were of three categories — Public-Private Partnership, Build-Own-Operate-Transfer, and Investment only.

The official said the British firm quoted around $0.9b for implementing the project, Balancing Modernisation Rehabilitation and Expansion of Eastern Refinery, on BOOT basis.

ERL managing director Rezaul Karim said they sent the proposal to the Energy Division after completing their tasks.

He, however, declined to say any thing about the project.

The Energy Division will send a proposal within this month to the cabinet committee on purchase for its approval before awarding the job to the British firm, an Energy Division official said.

Once the project initiated by the Bangladesh Petroleum Corporation is completed, the ERL will be able to refine 45 lakh tonnes of crude into diesel, petrol, octane, furnace oil, and other petroleum by-products a year.

At present its yearly refining capacity is a maximum of 15 lakh tonnes of crude and the government imports 50 lakh tonnes of diesel, furnace oil, and other petroleum oil to meet the domestic demand for transportation, power generation, industries, irrigation, and so on.

The BMRE project is designed to be housed in the existing ERL area and utilise the existing crude oil reception facilities.

The project also includes additional storage, ancillary utilities, and installation facilities.

An ERL official said the government would save $220m a year by refining a total of 45 lakh tonnes of crude with the state-run refinery. As per the latest calculation, the savings made by refining crude instead of importing refined petroleum products range between Tk 7 and Tk 8 per litre.

A government official told New Age that the contractor would complete the project in three years from signing of the deal and operate the ERL for 10 years for realising its investment and profit.