The interim government is on the path of major structural reforms in the state-owned energy sector. As part of this, initiatives have been taken to merge the country's three state-owned fuel marketing institutions - Padma Oil Company, Meghna Petroleum and Jamuna Oil Company - into two companies. At the same time, it has been decided to reduce the total eight institutions under Bangladesh Petroleum Corporation (BPC) to five.
According to sources, the Energy and Mineral Resources Department wrote a letter to the BPC chairman on January 11 to take the initiative to reorganize the eight institutions of BPC into five companies according to the type of work. The letter, signed by Md. Ahsan Uddin Murad, Deputy Secretary of the Department's Company Affairs-3 Branch, said that a committee was formed on February 11, 2025, to rationalize the manpower and scope of work of BPC and its subordinate companies, reorganize the organizational structure and other necessary reforms. The committee submitted its report on the reforms of BPC and its subordinate companies on December 8.
Sources from the BPC and the Ministry of Energy said that this initiative was not taken suddenly. A committee was formed on February 11 last year to rationalize the manpower, scope of work and organizational structure of BPC and its subordinate companies. After a long review, the committee submitted its report on the reforms on December 8.
Then, on December 10, a meeting chaired by Power, Energy and Mineral Resources Adviser Muhammad Fouzul Kabir Khan discussed the report. Five recommendations were finalized there. The letter with the recommendations reached the BPC office on January 15.
Adviser Muhammad Fouzul Kabir Khan said, “There have been some structural complications in the fuel sector for a long time. This reform initiative has been taken with the aim of rationalizing manpower and scope of work and restructuring the organizational structure. The work of implementing the recommendations will start soon.”
Eight institutions under BPC
Currently, eight state-owned institutions are operating under BPC. These are- Eastern Refinery PLC (ERL)
LP Gas Limited (LPGL),
Eastern Lubricants Blenders PLC (ELBPLC), Petroleum Transmission Company PLC (PTCPLC), Padma Oil Company PLC, Meghna Petroleum, Jamuna Oil Company, Standard Asiatic Oil Company Limited (SAOCL).
Among these, Eastern Refinery is the only oil refinery in the country. Padma, Meghna and Jamuna basically do the same work, marketing fuel oil through depots and sales centers across the country.
The decision to merge According to the decision of the ministry, Meghna Petroleum and Jamuna Oil will merge to form one company
Three marketing institutions including Padma Oil will be merged to form two companies. Eastern Lubricants Blenders and Standard Asiatic Oil Company will be merged with Eastern Refinery by purchasing 50 percent of the private sector shares.
According to the ministry's decision, the two companies will be merged with ERL by purchasing 50 percent of the private sector shares of ELBL and SAOCL. In addition, three marketing companies, Padma, Meghna, and Jamuna, will be merged to form two companies.
BPC sources said that having multiple companies for the same type of work has increased costs and created complexity in management. If merged, costs will be reduced, decision-making will be faster, and accountability will increase.
An employee who did not want to be named said, "There is concern among the employees. Discussions have started between the employees of BPC and its subordinate companies regarding this initiative. Especially if Padma, Meghna and Jamuna are merged, there is uncertainty about the possibility of posts, promotions, transfers and layoffs. Although there is talk of merging Padma-Meghna-Jamuna into two institutions, the ministry has basically decided to merge Meghna-Jamuna. However, these merger processes are very complicated."
However, BPC Chairman Md. Amin ul Ahsan said, "There have been discussions about converting eight institutions into five. However, no final decision has been made yet. Details on this will be known soon."
BPC Secretary Shahina Sultana said, "As part of the reform of the fuel department, the ministry has decided to reduce the number of BPC's eight companies to five. We have received a letter from the energy department in this regard. We have learned about the merger of three marketing companies out of them into two. However, the issues of merging companies are a long process. It requires a lot of time."
The total net profit of the state-owned oil companies in the 2024-25 fiscal year stood at around Tk 664 crore. A large part of this came from oil sales, interest on bank deposits, and the lubricants and gas sectors.
According to experts, the merger will speed up decision-making and reduce operational costs. However, they have emphasized on ensuring the security of employees' jobs and facilities.
