Aiming at saving money and time, a BPC project – the installation of a major pipeline system to pump in crude oil from ships in deep-sea, was not accomplished as of today.
The cost of the project has increased by almost 50 percent with a three-time extension of the deadline. The new deadline is now June 30, 2023, which was set for June 30, 2022, after the second revision of the tenure. All in all, the additional cost that will be needed would be around taka 2500 crore to complete the project.
The project titled, ‘Installation of Single Point Mooring (SPM) with Double Pipeline’ started in 2015. The State-owned Bangladesh Petroleum Corporation (BPC) had undertaken the project to transport imported raw petroleum from Bay of Bengal to Eastern Refinery Limited (ERL) in Chattogram.
It is one of the top priority projects of the Energy Division as the project will substantially save around taka 1000 crore a year from fuel transportation cost along with time. There will be no need to use lighter vessels to transport the raw petroleum.
The Project Director Md. Sharif Hasnat told Bangladesh Post that it could not be completed on time due to various reasons including Covid-19 pandemic and delay in the process of loan disbursement from Exim Bank of China.
“Now there is a lot of progress. Around 70 percent of work has been completed so far and we were expecting to complete the work by this year. All efforts are being made for this,” he added.
According to the project official, some 195 km out of 220 km of pipeline has already been laid. The buoys (floating) will be installed at the mooring point of the sea by next February. Once installed, there will be no more complications in the project.
BPC officials said the project was originally taken up in 2012 and after a long official process, BPC signed a contract with Chinese state-run company China Petroleum Pipeline Bureau (CPP) in 2015.
As per the deal, CPP is supposed to implement the project as EPC (engineering, procurement and construction) in the next 36 months from the signing of the agreement.
Sources said the original cost of the project was Tk 4,936 crore. In the first revision, it was raised to Tk 5,426 crore. The second revision took it to Tk 6,568 crore. BPC has recently sent a proposal to the Ministry for a third revision and said that the expenditure will increase by around taka 600 crores. The company has also applied for an extension of the project till June 2023. The cost of the project stood at Tk 7,124 crore due to a three-fold increase in time.
“State Minister for Power, Energy and Mineral Resources Nasrul Hamid has called for speedy implementation of the project ahead of schedule. For this, if necessary, a lot of work has to be done together in parallel,” he said.
He said, "The progress of the ‘Installation of single point mooring with double pipeline’ project is not satisfactory. Sometimes project costs increase due to failure or incompetence of the project director. Why would the ministry take responsibility for this?
At present, crude/ refined fuel oil imported from abroad is unloaded from mother vessels in the deep sea of the Bay of Bengal by small vessels, for which time and money are needed, the amount of system loss is higher.”
In this context, a deep-sea floating unloading facility has been set up for quick, easy, safe and cost-effective unloading of imported oil directly from the ship through crude oil and from there through a subsea pipeline directly to ERL’s tank for refined fuel oil.
The demand for fuel is increasing day by day. ERL currently refines 1.5 million tonnes of crude petroleum annually. On completion of unit -2, its capacity will increase to 4.5 million tonnes.
The SPM will have an annual unloading capacity of nine million. It will be able to unload 120,000 metric tons of crude oil in 48 hours and 70,000 metric tons of diesel in 24 hours.
Currently, it takes 10-11 days to unload crude oil at Eastern Refinery Limited (ERL) from mother vessel to small or lighter vessel.
The project will establish an SPM and Pipe Line End Manifold, set up 220 km pipelines, a tank farm and a pumping station at Moheshkhali, supervisory control and data acquisition system, as well as carry out land acquisition and offer compensation, expert services, and put in place fire-fighting systems and related facilities.
Under the project, six storage tanks will be constructed on a 90-acre area at Kalarmarchhara in Maheshkhali to store oil from mother vessels. Of these, refined diesel will be stored in three and crude oil in other tanks.
BPC officials said that despite the growing demand for oil in the country, the oil storage capacity has not increased much. As a result, even if the price of oil decreases in the world market, its benefits are not available. The construction of storage along with the pipeline will also increase the oil storage capacity of the country.
