Bangladesh to import diesel from Philippines

DHAKA (Reuters) - State-owned Bangladesh Petroleum Corporation (BPC) will buy 90,000 tonnes of diesel from a supplier in the Philippines for consumption from January to June next year, a senior energy official said on Sunday.

"The BPC will import the diesel from the Philippines National Oil Company (PNOC) for consumption during the half of next year and also to diversify sources of fuel as demand is rising gradually," the official said.

The BPC, country's sole importer and distributor of oil and fuels, on Thursday ended negotiations with the PNOC to buy the fuel oil at a cost of about $58 million.

He said the PNOC had approved Bangladesh's proposal to sell diesel at a premium of $3.90 per barrel, to benchmark spot quotes by price reporting agency Platts, lower than rates offered by Gulf refineries.

The BPC, under the existing contract, will import 150,000 tonnes of diesel and 30,000 tonnes of jet fuel from the PNOC for consumption during July to December of this year.

Bangladesh received the first consignment of fuel from the PNOC in July 2009 and started to tap new sources to diversify import markets to reduce its dependence on Kuwait Petroleum Corporation (KPC).

The BPC has, in the past two weeks, completed negotiations with state-run KPC and Egypt-based Middle East Oil Refineries (MIDOR) to buy more than 1.06 million tonnes of refined oil including diesel.

BPC is also eyeing Vietnamese company Petrovietnam as it has recently shown interest in supplying fuel under soft terms, official said.

To meet growing demand, BPC has already renewed its contract with Petco, the trading arm of Malaysia's national oil company, Petronas, for the import of about 1.4 million tonnes of diesel and jet fuel in 2010.