To import petroleum products for the state owned Bangladesh Petroleum Corporation (BPC), a total of sixteen international organisations submitted tender documents, BPC Chairman AM Badrudduja told energynewsbd.com on Thursday.
BPC on February 11, 2016 floated an international tender to import petroleum products, doing away with the government-to-government (G2G) negotiations. The last date for submission was February 18.
Badrudduja said that the tender bidding will be open on February 22. He said BPC will pay the cost of importing products from its own or GOB fund.
He also said the BPC wants to procure of 9.875 million barrels (13,20,000 tonnes) of import refined diesel (GASOIL) and 1.440 million barrels (18,0000 tonnes) of Jet A-1.
The BPC Chairman said the government believed premium rate would be lower for importing oil through international tenders instead of G2G purchase.
It is to be noted that the state-owned BPC incurred huge losses after introducing the G2G system in 2003-04.
Until 2003, the BPC imported petroleum products through tenders and negotiated premium rates –transportation, insurance and other costs- every six months. Recently, it imported refined diesel with a premium of $4.50 per barrel.
G2G negotiations came into effect in 2005. Under the agreement, BPC closed minimum two-year deals with the oil companies. Before that, its losses were lower under the competitive market tender policy.
The BPC has been importing about 5 million tonnes of fuel oil worth about $3 billion every year from 13 countries under the G2G deals. It made a profit of Tk 3,500 crore in 2014-15 when oil plummeted between $40 and $50 per barrel from $117.
In 2011-12, it incurred a record Tk105.52bn loss. In 2003-04, the amount was Tk9.6bn. Badrudduja claimed that buying oil at high rates and selling it at low prices back home had led to the losses.