The government’s new energy policy, outlined in a recent gazette, permits defaulting companies and their directors to invest in private oil refineries, even with pending loan default cases. This marks a significant policy shift, allowing private sector participation in crude oil import, refining, and marketing.
Notably, the eligibility criteria for private entrepreneurs have been relaxed, encouraging collaboration and innovation in the fuel oil sector. The final policy sets a minimum capacity requirement for fuel oil refineries at 15 lakh tonnes per annum and reduces the practical experience requirement for consortiums to five years. The policy mandates the construction of jetties and introduces a new condition for the establishment of modern crude oil refinery effluent treatment plants.
Private refineries must sell 60% of their fuel oil outputs to the state-owned BPC at a government-determined price initially, with the option to sell the remaining 40% through their network. After five years, this proportion will be reviewed, and private refineries can establish petrol pumps. Prominent private entities like Bashundhara Group, Partex Group, TK Group, and Elite Group have applied to establish refineries under this new policy, challenging the historical monopoly of state-owned BPC in Bangladesh’s fuel oil supply management.
