No headway in ER Unit-2 project

Eliminate red tape in no time

Published : 30 Sep 2022 07:30 PM

A project titled “Eastern Refinery Unit-2” taken 12-year back to enhance the country’s petroleum refining capacity has not seen the light of the day yet. The Unit-2 project was taken by Bangladesh Petroleum Corporation in 2010 to enhance the company’s capacity to 45 lakh metric tons by adding 30 lakh metric tons from the new one. As the bureaucratic red tape holds up Unit-2 project, it has become very difficult to implement it. 

The Unit-1 of Eastern Refinery Limited, the state run lone petroleum refinery installed in 1968 by a French company, has an annual production capacity of 15 lakh metric tons. At present, Bangladesh has a demand of 60 to 65 lakh tonnes of liquid fuel annually that includes diesel, furnace oil, jet fuel, kerosene, petrol and octane. Apart from petrol, Bangladesh is wholly import-dependent for fuel oil. Of the total import, around 80 per cent is refined fuel, which is costlier than crude oil and comes from countries in the Middle East.The country has been spending extra dollars to import a large amount of diesel every year as its oil refining capacity has not increased in the last 51 years. So, a lack of oil refining capacity, making it necessary to take an immediate measure to install the second unit of the  Eastern Refinery.

We expect that the project will

 get approval and its installation 

will begin as early as possible to 

ensure energy security of the country

This year the government is importing some 16 lakh metric tons of crude oil and 58.50 lakh metric tons of refined oil to meet the growing demand of the country. The cost of the project has been estimated at over Taka 19,400 crore. However, the Eastern Refinery Unit-2 project is expected to be placed in the ECNEC meeting for approval very soon. When the Unit-2 will be installed, the new refinery could help the country save $220 million every year, jumping the country’s crude oil refining capacity to 45 lakh tonnes from the existing 15 lakh tonnes per year. Besides, the refinery can enable the country to process any kind of crude oil and become an exporter of the refined petroleum products. On the other hand, Bangladesh would also be able to export the surplus finished petroleum products to different foreign countries including Sri Lanka, Bhutan, Myanmar and the north-eastern parts of India as well.

We all are now concerned about energy security as fuel price continues going up in the international market. We expect that the project will get approval and its installation will begin as early as possible to ensure energy security of the country.