A major part of the fuel oil demand in the country is diesel. About 36 lakh tonnes of diesel is imported every year. The Russia-Ukraine war has destabilized energy markets around the world. The government stopped buying oil and LNG gas at high prices from the spot market. In such a situation, low-cost fuel oil imports from India can resolve the ongoing crisis. At present the process of import from India through railways is going on.
Under the India-Bangladesh partnership pipeline project, fuel oil or diesel will be imported into the country from March next year. Pipeline construction is underway.
India-Bangladesh Partnership Pipeline Project started in 2020 to import fuel oil from India.
A 131.50 km pipeline is planned from India's Nulaibari Refinery Limited to Parvlbatipur Oil Depot in Dinajpur, including five km on the Indian side and 126.5 km on the Bangladeshi side.
Meghna Petroleum Limited and India's Numaligarh Refinery Limited are working on the implementation of this project.
If the project is implemented, 2 lakh metric tons of fuel oil can be imported in the first three years, 3 lakh metric tons in the next three years, 5 lakh metric tons in the next four years and 10 lakh metric tons in the remaining five years.
Since 2017, BPC has been importing around 2200 tonnes of diesel per month from Numaligarh Refinery Limited (NRL) through railway.
It takes a month to reach the oil depot in Parvlbatipur by train. However, after the implementation of the pipeline project, it will take only a few hours for the diesel to arrive at the Parbatipur railhead depot from India. This will greatly reduce the cost of transportation.
Pipeline project director Tipu Sultan said, the final phase of the pipeline will be completed in December. Now how much oil can be brought depends on the capacity of India's refineries and pipelines.
However, according to the agreement, BPC said that it will be able to bring diesel from India for 15 years.
Chairman of Bangladesh Petroleum Corporation (BPC) ABM Azad said that the process of bringing oil from India is ongoing. For this purpose, the storage capacity of Parbatipur railhead depot is being increased. 2.5 lakh tonnes of oil is expected to be imported, which will be increased in phases. Bringing oil through pipelines will reduce our costs to a great extent. The cost of buying oil from abroad is $10 per barrel including freight and accessories. It would cost as much as $8 to bring oil there via pipeline. We hope to start bringing diesel from India through the pipeline by February or early March next year.
According to BPC, a reduction of $2 per barrel compared to the international market price of fuel oil from India can save about $15 lakh or Tk 15 crore per 1 lakh tonne, which will contribute to foreign exchange savings. No need to worry about dollars as payment is made through rupees.
Import of oil through pipeline from India is a positive thing for Bangladesh. It is creating an alternative source of imports. But if we transacted in rupees instead of dollars. This will reduce the pressure on our foreign exchange. This will reduce the fuel oil crisis.
