Anisul Islam Noor :
A high-level Bangladesh team is now visiting India to finalise terms and conditions of the proposed 130 kilometers cross border pipeline setting up project for fuel oil business between the two neighbours.
The final deal of energy sector cooperation, including the construction of the pipeline between the two countries, are expected to be inked during the scheduled visit of Prime Minister Sheikh Hasina to India in April, Power Ministry sources said.
The members of the team include officials from the Ministry of Power, Energy and Mineral Resources and Bangladesh Petroleum Corporation (BPC).
During the visit they will also discuss planned setting up of a Liquefied Petroleum Gas (LPG) bottling plant and other related issues on energy cooperation, sources said.
India’s state-run Bharat Petroleum Corporation Ltd (BPCL) recently had backtracked from the agreed term of bearing the cost of building the pipeline, it was alleged.
The BPCL had intended to provide the cost from Indian credit line instead of its own coffer, a senior BPC official said.
It was a violation of the terms of memorandum of understanding (MoU) inked in October last year as the BPCL had agreed to build the pipeline at its own cost to export around 1.0 million tonnes of diesel from its Numaligarh refinery in Assam to Bangladesh for 15 years, he said. The BPC and the BPCL also had agreed to fix the premium rate at US$5.50 per barrel to Mean of Platts Arab Gulf (MoPAG) diesel assessments on cost and freight (CFR) basis meaning that the price would be above US$5.50 per barrel from international price of diesel.
In the MoU, the BPCL had agreed to build the pipeline spending money from its own coffer subject to import of diesel by the BPC from the BPCL.
The cost of fuel transportation and the loss from evaporation are covered from the premium. Two state-run oil entities also had agreed to stall the initial plan of building a joint venture company to share the costs of building the oil-carrying pipeline.
The proposed pipeline, once constructed, will carry around 1.0 million tonnes of diesel per year to Bangladesh’s northern region.
Diesel demand is around 1.10 million tonnes in 16 northern districts, the BPC officials said.
Initially, the pipeline is planned to carry around 300,000 tonnes of diesel to Bangladesh, which will gradually be increased to 1.0 million tonnes.
They said the 130 kilometers pipeline will touch Panchagarh, Nilphamari and Dinajpur to reach Parbatipur oil storage tanks.
According to BPC, the total 130 kilometers, the length of pipeline inside Bangladesh will be 125 kilometers and in India it will be of around 5 kilometers, said the 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 countries since then.
