Bangladesh okays $3 bln Saudi Arabia oil investment

DHAKA (Reuters) - Bangladesh has approved to go ahead with a $3 billion investment by Saudi Arabia to set up an oil refinery with a capacity to produce 300,000 barrels of oil products a day, a senior official said on Saturday.

Hi-Tech International Group of Saudi Arabia and Cosmopolitan Oil Refinery Management Limited of Bangladesh last February signed a deal to implement the project within the next 40 months, officials said.

Mohammad Mohsin, secretary of government's energy and mineral resources division, told Reuters that the Saudi firm would produce for the domestic market but may also make products for export.

The plant will be set up with foreign investment and will import more than 5 million tonnes of crude oil from Saudi Arabia.

The refinery's production capacity will be more than three times that of the state-run Bangladesh Eastern Refinery Limited (BERL), the only refinery in the country, Cosmopolitan Oil Refinery Management Chairman Dewan Sultan Ahmed told Reuters.

BERL, at the port city of Chittagong with 1.5 million tonnes capacity, supplies refined oil to three state-owned oil firms for distribution across the country.

Bangladesh imports 3.8 million tonnes of fuel a year, including about 1.5 million tonnes of crude oil, officials said.