BPC claims compensation from PDB

BPC claims compensation from PDB

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Bangladesh Petroleum Corporation (BPC) has sought compensation of about Tk 12 crore from the Power Development Board (PDB) for not receiving fuel as per its requisition.Both the BPC and PDB are state-owned agencies. BPC is the state-owned fuel import and supply body of the Energy Division while PDB is power generating agency under the Power Division. Both the Divisions are under the Ministry of Power, Energy and Mineral Resources.
BPC has been supplying huge petroleum fuel to the PDB for its power plants including the rental ones installed by private sector sponsors under tripartite agreement where Bangladesh Railway is also partly responsible to transport the fuel.
As per the agreement, PDB will submit a requisition plan to the BPC to import fuel and supply to the power plants. But in last few months, the PDB submitted such plans, but did not receive the fuel as per requisition.
A top official of BPC informed that the PDB had submitted a requisition for 80,000 metric tons of furnace oil for the month of February 2012, but it received only 64,000 metric tons. Similarly, PDB’s fuel requisition was 133,000 metric tons for March, but it took only 93,000 metric tons only.
Such gap in receiving huge petroleum fuel by the PDB put the BPC in great trouble as the state-owned fuel supply agency was not in a position to store the unconsumed fuel.
BPC officials said that storing of the unconsumed fuel costs them a lot as it involves various expenses like cancellation of transportation orders, storing them in vessels or in depots apart from fuel’s evaporation losses. As the BPC has limited storage capacity, it had to keep most of the fuel unloaded in the vessels and pay compensation to the shipping agencies.
They said the BPC had to pay about US$ 15,000 per day for keeping the imported fuel unloaded in vessels.
When contacted, BPC chairman Eunusur Rahman admitted the financial loss and said that his organization has sent letters claiming compensation from the PDB for its loss.
“We had sent letters on several occasions to the PDB urging them for compensation,” he told UNB.
According to the BPC officials, they sent the last letter about 15 days ago, but so far received no reply from the PDB.
Apart from non-consumption loss, the BPC has been incurring huge financial loss for its import of petroleum fuel and selling those at subsidized rates. In the fiscal 2011-12, the BPC had incurred a loss of Tk 12,000 crore. The government compensated the state-owned body under a subsidy package.
The government allowed private sponsors setting up the rental and quick rental power plants as emergency short-term measures to address the nagging power crisis. But production cost of the plants is very high.
The rental and quick rental power plants now generate about 2,000 MW of electricity while the PDB’s total power generation is about 6,000 MW. UNB

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