ASIFUR RAHMAN

The Bangladesh Power Development Board (PDB) has said it paid Tk 644 crore more than necessary to the Bangladesh Petroleum Corporation (BPC) for furnace oil supplied to power plants over the last one and a half years.

At a public hearing yesterday, PDB officials said BPC charged a fixed price of Tk 86 per litre during the period, despite its actual procurement cost varying between Tk 57 and Tk 83 per litre in different months.

PDB noted that 35 percent of BPC’s furnace oil supply comes from the state-owned Eastern Refinery, while the remaining 65 percent is imported.

It argued that prices should be set based on a weighted average of domestic and imported costs, rather than through a fixed or arbitrary calculation.

“Furnace oil is a byproduct of crude oil and has a global benchmark price, known as Free on Board (FoB). The cost at Eastern Refinery should not exceed this, but BPC does,” said Md Jahangir Alam Mollah, a PDB director, during a hearing before the Bangladesh Energy Regulatory Commission (BERC).

He said BPC has sold furnace oil at Tk 86 per litre for a long time, while private companies imported the fuel at Tk 57 per litre in December last year.

BERC held the public hearing on furnace oil pricing

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