By Ruma Paul
DHAKA Nov 21 Bangladesh Petroleum Corp (BPC)
has finalised term contracts with 10 companies for refined oil
product imports in the first half of 2017 at lower premiums than
this year's term deals.
The premium for gasoil for the January to June period will
be $2.30 a barrel over Middle East quotes, two company sources
with direct knowledge of the matter said on Monday. That is down
from $4.40 a barrel for the first half of 2016.
BPC's term contract for jet fuel was fixed at a premium of
$3 per barrel over Middle East quotes, the sources said, down
from $5.40 a barrel during the same period in 2016.
Suppliers for Bangladesh's middle distillates contracts
include Kuwait Petroleum Corp, Malaysia's Petronas, Emirates
National Oil Company, Philippines National Oil Company,
Vietnam's Petrolimex, Indonesia's Bumi Siak Pusako, PetroChina
and Thailand's PTT. The companies will all receive the same
BPC sought 965,000 tonnes of gasoil with a sulphur content
of 500 parts per million, 120,000 tonnes of 180-centistoke high
sulphur fuel oil and 90,000 tonnes of jet fuel for the first
half of 2017 in the tender issued in October.
BPC started issuing tenders for its long-term contracts in
February after a 15 year hiatus, during which it directly
negotiated with suppliers.
The premiums are higher than the lowest offers it received
in its tender.
China International United Petroleum & Chemicals Co (Unipec)
offered to sell gasoil at $2.16 and $2.08 a barrel over Middle
East quotes, an offer document seen by Reuters showed. It also
had the lowest offer of $2.76 a barrel for jet fuel.
BPC will pay a premium of $15.80 a tonne to Singapore spot
quotes for the first half of next year, the company sources
That is the same level that Vitol offered into the tender.
BPC plans to lower the sulphur content of its gasoil imports
from January 2017, in line with a global trend towards cleaner
BPC plans to buy 1.6 million tonnes of gasoil, 200,000
tonnes jet fuel and 200,000 tonnes fuel oil through term
arrangements in the next year, the company sources said.
A shortfall in supplies of natural gas has forced the South
Asian country to burn oil, a costlier option, to generate
(Reporting by Ruma Paul; Editing by Christian Schmollinger)