Dhaka: State-run Bangladesh Petroleum Corp (BPC) is seeking help to pay for an estimated $4.3 billion (Dh15 billion) of oil imports in the next fiscal year to run new power plants to meet growing energy needs, a top executive said yesterday.

BPC, Bangladesh's only fuel importer and distributor, normally buys up to 3.8 million tonnes of refined and crude oil annually at costs between $2.5 billion and $3.5 billion, its chairman Anwarul Karim said.

"But for the next fiscal year our imports may rise to 4.4 million tonnes as the government plans to set up several oil-fired power plants," he said.

To meet the rising fuel bill, Bangladesh has asked the Jeddah-based Islamic Development Bank (IDB) to provide more funds, Karim said. The IDB gives Bangladesh about $1.2 billon a year now to pay for oil imports.

"We have also asked Bangladesh's central bank to allocate additional funds for oil imports," Karim added.

The new power plants fuelled by diesel and furnace oil will add more than 1,350 megawatts of power to the national grid, a partial fulfilment of promises by Prime Minister Shaikh Hasina to ease a nagging power crisis that affects households and industries.

But the BPC, which sells many fuels below cost as part of a complicated subsidy programme, has accumulated losses of $2.83 billion that may rise to $3.05 billion at the end of the current fiscal year ending in June.

Bangladesh now imports oil from Vietnam, Malaysia, the Maldives, Kuwait, Saudi Arabia, India and the UAE. But officials said it was also looking for other sources to buy the additional fuel.

Temporary power

Aggreko, a leader in the provision of temporary power and temperature control services, said it has signed an agreement with the Bangladesh Power Development Board (BPDP) for the provision of 200 megawatts of temporary power.

The pact has an estimated value of $150 million over three years, and will become effective as a contract following customary procedures and approvals. Bangladesh has recently been affected by power shortages caused by increased demand. Although the Government has embarked on an ambitious programme to increase the capacity of the national grid, power demand is now exceeding supply, with the result that widespread power cuts are inhibiting economic development. To bridge the immediate gap between power supply and demand, Aggreko will provide turn-key power packages to BPDP, which will feed power directly into substations connected to the national grid. The first tranche of power will be operational on July 1, with the entire project scheduled to be commissioned in August.