The Financial Express

ERL resumes operation

| Updated: July 01, 2020 17:29:38

ERL resumes operation

Eastern Refinery Ltd (ERL), the lone crude oil refinery of the country, resumed operation this week as private sector started taking furnace oil from its stocks.

Local Summit Group took around 10,000 tonne of furnace oil from the ERL storage a couple of days ago facilitating the refinery to back in operations, ERL managing director Md Akterul Hoque told the FE.

He hoped that private sector will continue taking furnace oil to run their furnace-oil fired power plants from the ERL stocks to keep it operational.

The ERL, a wholly-owned subsidiary of state-run Bangladesh Petroleum Corporation, or BPC, had to suspend operation due to inadequate furnace oil storage facility.

ERL’s oil storage capacity was saturated due to muted domestic demand as a result of the ongoing coronavirus pandemic and subsequent limited scale of business and commercial operations.

The BPC had to cancel one 100,000 tonne Murban crude oil term cargo from Abu Dhabi National Oil Company, or ADNOC, this month as the consequence.

The ERL was last shut on regular overhauling for 35 days starting from November 16, 2019.

It shuts operations once in every two years for overhauling and maintenance.

Consumption of ERL’s furnace oil reached the lowest level due to limited operations of state-owned furnace oil-fired power plants.

All other refined petroleum products, which are the output of the ERL like diesel, jet fuel, petrol, octane and super kerosene, have consumption though at reduced level due to the ongoing coronavirus pandemic.

ERL is the sole supplier of furnace oil to the furnace oil-fired power plants owned the government.

ERL has around 150,000 tonne furnace oil storage capacity across the country.

Bangladesh has around 5700 megawatt or MW capacity furnace-oil fired power plants, of which 4500 MW capacity are owned by the private sector, while the remaining 1200 MW capacity is owned by the public sector.

The Bangladesh private sector typically imports around 3.0 million tonnes of furnace oil independently to run their power plants.

Private sector has storage capacities separately to carry out furnace oil imports regularly to run their power plants.

During a recent meeting the private sector pledged to take around 10 per cent of their total furnace oil requirements from the ERL offering the state-run refinery a breathing space to facilitate storage of furnace oil.

The installed capacity of the ERL, established in 1968, is 1.5 million tonnes per year.

But currently it has been refining crude oil at de-rated capacity.

ERL produces refined petroleum products from crude oil and sells it in Bangladesh's local market through BPC's subsidiary marketing and distribution companies.


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