Over five years have gone by since the process of building a second unit of the state-owned Eastern Refinery Limited (ERL) got underway, but the construction work has yet to start.
And by the time, the estimated cost of the project has spiked from Tk 130 billion to Tk 195 billion, according to ERL sources.
Now, Bangladesh Petroleum Corporation (BPC), the parent company of ERL, awaits approval for the Development Project Proposal (DPP) on the second unit before it takes steps to float tenders for the construction.
The approval depends on the allocation of requisite funds, now under consideration by the finance ministry, the sources said.
After the fund allocation, the cabinet committee will finally approve the DPP and the construction work is likely to start next month, they added.
Managing Director of the ERL Md Lokman told The Financial Express, "We have submitted the DPP, which is now in the planning commission. And the energy ministry has sent a request for fund allocation to the finance ministry."
With a view to ensuring energy security of the country, the government approved of the proposal for construction of the Unit-2 with a refining capacity of 3.0 million tonnes of crude oil.
The formal process to build the second unit began in 2016 and the process for its construction started in 2018, sources said.
The process, now at the final stage, saw the DPP go through amendments several times.
Meanwhile, the design and layout of the second unit is now ready. Technip of France, the company that was appointed to do the job, has already submitted the design and layout plan to the ERL authority.
Presently, the crude oil-processing capacity of ERL is 1.5 million tonnes a year while the domestic demand for petroleum products stands at nearly 6.5 million tonnes a year.
Once the second unit goes into operation, the processing capacity of ERL will increase to 4.5 million tonnes per annum.
It will also contribute to the production of eco-friendly motor gasoline and diesel oil. A total of 30 acres of land near the ERL has already been acquired for its expansion.
BPC is in talks with a Chinese state-owned firm, Wuhan Engineering Company Ltd, to implement the project, the sources said.
