Bangladesh holds first tender for fuel oil
(Reuters) Bangladesh Petroleum Corp. (BPC) issued its first tender to buy fuel oil as part of efforts to move away from direct-term deals with fuel products suppliers to try to buy at cheaper rates.
State-owned BPC is seeking 160,000 tons of 180-centistoke high sulfur fuel oil, a tender document showed. The tender closes on July 20 and is valid till Oct. 2.
In February, BPC issued its first tender to buy oil products in 15 years when it sought more than 11 MMbbl of diesel and jet fuel and managed to buy at lower rates than its term deals.
The fuel oil tender is the first since BPC started importing the oil product through term deals with oil companies in late 2010, a senior BPC official said.
"Achieving more competitive rates is a main reason for switching to tenders," the official said.
The tender was for delivery between August and December.
A shortfall in supplies of natural gas has forced Bangladesh to burn oil, a more costly option, to generate electricity.
BPC imported 140,000 tons of fuel oil during the first half of 2016 and two more cargoes, each containing 20,000 tons, are being imported in July, another official said.
For the rest of the current year, the BPC has no plan to import further fuel oil through term deals, the official added.
Bangladesh buys fuel oil from a number of national oil companies, including Malaysia's Petronas and Vietnam's Petrolimex.
BPC's 33 Mbpd refinery in Chittagong meets about 30% of the country's fuel oil needs for oil-fired power plants.
Until early 2010, Bangladesh was an occasional seller in the Asian fuel oil market, offering small volumes of about 30,000 tons irregularly.
Reporting by Ruma Paul; Editing by Jane Merriman
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