Ctg-Dhaka oil pipeline set for December commissioning

The 250-kilometre Chattogram-Dhaka oil pipeline, designed for rapid fuel transport, is set for commissioning in December, with the contractor expected to hand over the project in January 2025.

This Tk3,600 crore project will mark Bangladesh's first use of pipelines to transport oil, aiming to save time, reduce transportation costs, and lower system losses and environmental pollution, according to industry insiders.

The Bangladesh Petroleum Corporation (BPC) estimates that the pipeline, capable of transporting 30 lakh tonnes of fuel oil annually, will save Tk150 crore in transportation costs annually.

BPC officials have confirmed that pipe installation is fully complete, and 90-95% of the tank station construction is finished. Pre-commissioning activities are currently underway.

"Everything is proceeding as planned, and if no major issues arise, the commissioning will be completed in December," Anupam Barua, director of operation and planning at BPC, told The Business Standard.

Aminul Hoque, assistant director of the project, acknowledged delays during the political unrest in July and August but noted that progress had resumed.

"Construction was disrupted as workers and engineers faced access issues, and material transport was delayed. However, we intensified efforts to get back on track, especially since the project has already been delayed four times," he said.

Hoque added, "We are in the final stages of pre-commissioning and, barring any unforeseen complications, expect to complete the process by late November or early December. The contractor is expected to hand over the project by January next."

The nation currently relies on coastal tankers, railway wagons, and tank lorries to distribute fuel after imports arrive at Chattogram depots from global suppliers.

Dhaka and its surrounding areas consume nearly two million tonnes of oil annually, 90% of which is transported via waterways using around 200 tanker vessels.

This transportation method costs approximately Tk150 crore per year and is vulnerable to pilferage during transit, causing significant financial losses to the BPC.

The pipeline was initially planned in 2015, with the government aiming to complete it by 2017, intending to reduce transportation costs and prevent theft.

That same year, BPC initiated a feasibility study and enlisted Engineers India Limited as consultants. Following the study, a policy decision was made to proceed with the project.

In October 2018, the Executive Committee of the National Economic Council (ECNEC) approved the pipeline project, titled "Supply of Fuel Oil in the Pipeline from Chattogram to Dhaka", with an initial budget of Tk2,861.31 crore.

The pipeline was designed to transport 27-30 lakh tonnes of fuel annually, with a future capacity increase of 50 lakh tonnes. However, delays and cost revisions pushed up the budget to Tk3,171.85 crore.

The project was then revised again and the total cost was finalised at Tk3,600 crore, with the Ministry of Energy and Mineral Resources extending the deadline to December 2024.

The 24th Engineer Construction Brigade of the Bangladesh Army is overseeing the project's implementation.

So far, 241.28 kilometres of the pipeline have been installed from Guptakhal in Patenga to Godnail in Narayanganj, passing through Feni, Cumilla, Chandpur, and Munshiganj.

The 16-inch diameter pipeline is buried five feet underground for security and stability. An additional 8.29 kilometres of pipeline with a 10-inch diameter is set to connect Godnail to Fatullah.

The entire pipeline is protected by a three-layer extruded polyethene coating. The pipeline route has traversed the beds of 22 rivers and canals, with nine stations along the way, and a new fuel depot already established in Cumilla's Barura upazila.

As part of future expansions, BPC plans to install a 59.23-kilometre, 8-inch diameter pipeline from Cumilla to Chandpur to facilitate oil distribution to the Chandpur region.

Once operational, the pipeline will improve fuel delivery times, reduce traffic congestion, and lower transportation costs and accidents.

In the last fiscal year, BPC imported 63.71 lakh tonnes of petroleum products at a cost of Tk55,663.25 crore.

During the same period, 67.61 lakh tonnes of fuel were sold across the country. The distribution network supporting these operations includes 27 depots—11 along waterways, nine rail-based, two barge depots, one near a gas field, and four aviation depots.

Around 50,000 personnel are directly involved in maintaining uninterrupted fuel supply operations throughout the country.

Earlier in April this year, another 110 km pipeline, the Single Point Mooring project, to transport imported fuel oil from the mother vessel to the Easterner Refinery in Chattogram was commissioned.

The project, which was constructed at a cost of Tk8,300 crore, has yet to go into operation as the appointment of an international operator has been stuck in a bureaucratic tangle. BPC estimates that the project would save Tk800 crore in freight costs annually.