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Single Point Mooring (SPM) with double pipeline project worth Tk 8,300 crore is failing to utilise its full capacity due to the non-expansion of the country's refinery capacity.
According to official sources, the newly installed SPM can now hardly utilise 60 per cent of its capacity while around 40 per cent remains unutilised, reports UNB.
The SPM project took about nine years to implement and now the project has been operational recently through execution of a test-run. But formally the project will be completed in June this year, said an official of the Bangladesh Petroleum Corporation (BPC).
Officials informed that after the recent commissioning of the SPM project, now it takes only 48 hours to transfer the imported petroleum from the mother vessel to storage tanks.
Before setting up the SMP, it took 11-12 days to bring the imported fuel to the oil tanker of Eastern Refinery Limited in the Petenga area through lighterage ships, which is very time-consuming, expensive, and risky.
Currently, no lighterage is required to carry fuel from the mother vessel, which is now moored at the outer quay, after the implementation of the project, said the officials.
The SPM was built on over 90 acres of land under a G2G project of Bangladesh and China at a cost of Tk 8341 crore at Maheshkhali Upazila in Cox's Bazar.
Officials said that three tanks have a storage capacity of 1.80 lakh kilolitres of crude oil and three tanks with 1.08 lakh kilolitres of furnished oil.
Project Director of the SPM Sharif Hasanat admitted that the project's 30-40 per cent capacity remained unutilised because of the limitations in refining more crude oils.
He informed that Bangladesh annually imports about 4.5 million tonnes of refined oils and another 1.5 million tonnes of crude oil from abroad.
"Through handling the imported oils, the SPM project now utilises 60 per cent of its capacity," he said, adding that if more crude oils are imported SPM can be used for transportation purposes.
Officials said the government has undertaken a project to expand the capacity of the country's only refinery --the Eastern Refinery at Patenga with the title ERL-2 to increase the existing capacity by 3 million tonnes.
However, that project has not been implemented in the last 14 years since the project was conceived by the Bangladesh Petroleum Corporation (BPC).
According to official sources, BPC was considering a technical offer from Technip, a French engineering company, which was engaged through an unsolicited process for creating Front End Engineering Design (FEED) involving Tk 371.81 crore for the proposed ERL unit-2 through a contract signed in January 2017.
But Technip has left and a local company is trying to persuade the government to implement the ERL-2 project through a public-private partnership (PPP) although that private company has no experience in implementing such a project, said a top official of the BPC.
The Unit-2 project was taken by BPC in 2010 to enhance the company’s capacity to 4.5 million tonnes by adding 3 million tonnes from the new one.
The Unit-1 of the ERL, which was installed in 1968 by the same French company, has an annual production capacity of 1.5 million tonnes.
Recently, an Indian firm claimed that it would be involved in the project to implement it at a cost of $1.7 billion dollars over a period of the next three years.
Officials said when BPC conceived the idea of ERL Unit-2 in 2010, the project cost was estimated at Tk 13,000 crore. Then, the project’s cost was raised to Tk 16,739 crore in a revised proposal.
But now, the cost may cross Tk 18,000 crore, he said, adding that BPC has sent a new development project proposal (DPP) to the Planning Commission through the Energy and Mineral Resources Division (EMRD) seeking another revision to the cost.
The country consumes about 6-6.5 million tonnes of petroleum of which 4.8-5 million tonnes is imported as refined while the remaining 1.2-15 million tonnes is crude oil to refine those at ERL.
