DHAKA: A Bangladesh government team is currently visiting India to finalize terms over construction of the proposed 130-kilometre cross-country pipeline and long-term import of petroleum oil from the neighboring country, said officials.
The team, comprising officials from the Ministry of Power, Energy and Mineral Resources (MPEMR) and state-run Bangladesh Petroleum Corporation (BPC), will also discuss planned building of a liquefied petroleum gas (LPG) bottling plant and other relevant issues on energy cooperation, they said.
Final deals over energy sector cooperation including the construction of the pipeline are expected to be inked during the forthcoming visit of Prime Minister Sheikh Hasina to India in April.
India’s state-run Bharat Petroleum Corporation Ltd (BPCL) recently had reneged on the agreed term of bearing the cost of building the pipeline, it has been alleged.
The BPCL had intended to provide the cost from Indian credit line instead of its own coffer, a senior BPC official said.
The proposed pipeline, once constructed, will carry around 1.0 million tons of diesel per year to Bangladesh’s northern region.
Diesel demand is around 1.10 million tons in 16 northern districts, the BPC official said.
Initially, the pipeline is planned to carry around 300,000 tons of diesel to Bangladesh, which will gradually be increased to 1.0 million tons. They said the 130-kms pipeline will touch Panchagarh, Nilphamari and Dinajpur to reach Parbatipur oil storage tanks. Of the total 130 kms, the length of pipeline inside Bangladesh will be 125 kms and in India it will be of around five km, said officials.
Both the countries finalised pipeline route and tested the soil to quicken the installation of the pipeline. But the row over fixing of premium rate has delayed progress of building the first cross-country pipeline between the two neighbouring South Asian countries since then.
Separately, the BPC has been importing 2,200 tons diesel per month through railway from India’s Numaligarh refinery.
The benchmark price of Indian diesel is similar to the price that the BPC pays currently for imports having 0.05 per cent sulfur content from international market, a senior BPC official said.
But the BPC has been paying a premium of US$ 7.0 per barrel to MoPAG diesel assessments on cost and freight (CFR) basis to the Indian BPCL.
The Corporation currently imports around 3.5 million tons of diesel annually to meet local demand.
