Wednesday, October 25, 2017

Crossing border: NRL inks 15-year diesel export deal with Bangladesh Petroleum Corporation

NUMALIGARH Refinery Ltd (NRL), the Assam-based subsidiary of state-run Bharat Petroleum Corporation (BPCL) has inked a 15-year agreement with Bangladesh Petroleum Corporation (BPC) for exporting gas oil (off road diesel). In the process, the Miniratna PSU has become the first Indian company to sign a long-term fuel supply deal with Bangladesh.
The heads of the two entities inked the deal in the presence of external affairs minister Sushma Swaraj, who concluded her two-day visit to Bangladesh.
BPC will initially...
import up to a quarter million tonne per annum (MTPA) of gas oil from NRL for the first three years through a 133-km product pipeline proposed to be built with a capacity of 1 MMTPA, the company said in a statement. The quantity will be gradually raised to 400,000 tonnes over the tenor of the supply agreement which will take effect after the pipeline is built.
The deal envisages BPC paying a premium of $5.50 per barrel over Middle East rates, which is higher than US dollar 2.20 the Bangladesh company pays as premium for fuel imported in ships at the Chittagong port.
Bangladesh roughly imports 3.2 million tonne of diesel annually from companies in Kuwait, Malaysia, UAE, Philippines, Vietnam, Thailand, Indonesia and Zhenhua Oil. But the Indian imports will still be cheaper as there would be no additional expenditure on transporting the imported fuel upcountry. NRL will supply the fuel at the main distribution depot in the northern part of Bangladesh, the main consumption centre.
NRL is already supplying a small volume to BPC for the country's northern region. India and Bangladesh had entered into a new era of petroleum trade with a goodwill tanker- train, flagged off by the oil minister Dharmendra Pradhan in March 2016 from NRL's Siliguri marketing terminal to the neighbouring country. In April 2017, another railway rake containing diesel from NRL's Siliguri marketing terminal to BPC's Parbitipur depot was flagged off by PM Modi and his Bangladesh counterpart Sheikh Hasina through remote device from New Delhi. A few more railway rakes have been dispatched from NRL to BPC in the intervening period.
The 3 MMTPA Numaligarh Refinery Limited was dedicated to the nation by former Prime Minister AB Vajpayee on July 9, 1999. Its commercial production began in October, 2000.

The present authorized capital of NRL is Rs. 1000 crore and paid up capital is Rs. 735.63 crore. Bharat Petroleum Corporation Limited has 61.65 percent stake in the Miniratna PSU. Govt. of Assam owns 12.35 percent whereas Oil India Limited has 26.00 percent stake in the PSU. Its major products include LPG, naphtha, motor spirit (MS), aviation turbine fuel (ATF) superior kerosene oil (SKO), high speed diesel (HSD), raw petroleum coke (RPC), calcined petroleum coke (CPC) and sulphur.

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