Bangladesh Petroleum Corp (BPC) has received offers in its first tender to buy fuel oil at premiums lower that its term deals, two company sources said on Sunday.
The tender was issued as part of an effort to move away from direct-term deals with fuel products suppliers to try to buy at cheaper rates.
A total of nine international oil and trading companies have been competing to win the tender for 160,000 tonnes of 180-centistoke high sulphur fuel oil. The tender closed on 20 July and is valid till 2 Oct.
Vitol came up with the lowest offer of a premium of $15.80 a tonne to Singapore spot quotes, while the state-owned BPC imported fuel oil in the first half at a premium of $24 in term deals with companies.
“Vitol will get the tender if all other papers submitted by them fulfil terms and condition set out by the tender,” one source said, adding that other documents were being scrutinised.
The tender was for delivery between August and December.
A shortfall in supplies of natural gas has forced Bangladesh to burn oil, a more costly option, to generate electricity.
In February, BPC issued its first tender to buy oil products in 15 years when it sought more than 11 million barrels of diesel and jet fuel and managed to buy at lower rates than its term deals.