Anisul Islam Noor :
Bangladesh Petroleum Corporation (BPC) wants to get return its rights to import the entire quantity of petroleum products, including furnace oil, for selling those in local market.
BPC is now in strong position to ensure efficient management of petroleum products and to check pilferage, a senior official of the Corporation told The New Nation on Saturday preferring anonymity.
“We have sent a letter to the Energy and Mineral Resources Division under the Ministry of Power, Energy and Mineral Resources in this regard,” the BPC official said.
He added that the BPC also sought waiver of supplementary duty (SD), Value Added Tax (VAT) and Customs Duty (CD) the way the private sector enjoys.
“If we get waiver from paying duties and taxes to the national exchequer, we will be able to provide furnace oil at lower price to power plants,” the official added.
It is to be noted that several years back the government had allowed import of furnace oil by the private sector power plants. SD, VAT and CD were also waived during the time to encourage the private importers, he said.
Besides, he said, the government has also been providing 9 percent service charge along with import costs to the private oil importers as an incentive.
But the BPC now thinks that the situation has changed as it has been making hefty profits because of lower global oil prices, he said.
The Bangladesh Petroleum Corporation Act has assigned it with the task of managing the country’s overall fuel import and supply chain, the official said.
BPC had lost one of its profit-making ventures — furnace oil marketing — from 2015 in a major policy shift. This made room for private sector importers for doing brisk business.
Currently, the private sector imports around 1.50 million tonnes of furnace oil a year to run their oil-fired power plants.
Officials said the country currently has around 50 oil-fired power plants, mostly owned by private sector entrepreneurs.
Bangladesh will need to import additional 750,000 tonnes of furnace oil from next year as over a dozen new oil-fired power plants are set to go into operation in 2018.
But the BPC official expressed the fear that privately-owned power plants might sell a large quantity of the petroleum fuel in the open market to make ‘extra’ profit.
Although the government-fixed rate for furnace oil is Tk 42 per litre, the private sector can import it at rates as low as Tk 25 per litre by taking advantage of lower oil prices in the international market.
This allows the private sector to bag hefty profits by selling furnace oil in open market, sources said.
Allegations are rife that private importers of petroleum products are violating the government directives over import procedures and continuing brisk business in the absence of transparency.
The private sponsor is not providing necessary information to any state agencies during import, which is a violation of the government directives, the BPC official alleged.
As per the BPC rule, the private sector importers are supposed to inform it (BPC) about each of their import consignment, he pointed out.
