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Unipec, Vitol win tender to supply Bangladesh with fuels in H1 2020

February 11/2020

MOSCOW (MRC) -- Energy traders Unipec and Vitol have won a tender to supply Bangladesh Petroleum Corp (BPC) with up to 1.06 million tons of oil products in the first half of 2020 after placing the lowest offers, as per Hydrocarbonprocessing

State-owned BPC is seeking 760,000-880,000 tons of gasoil with a sulfur content of 500 parts per million, 110,000 tons of jet fuel, 40,000 tons of 180-centistoke high-sulfur fuel oil and 30,000 tons of 95-octane gasoline.

Unipec and Vitol have won the tender as they came up with the lowest bids, a senior BPC official said.

The oil products are due for delivery from Jan. 1 to June 30, the tender document showed. Six traders competed for the tender, another BPC official said.

Unipec - a trading arm of Chinese state major Sinopec - placed the lowest offer for up to 450,000 tons of gasoil and 60,000 tons of jet fuel at premiums to Middle East quotes of USD2.33 and USD3.32 a barrel on a cost-and-freight basis respectively, the official said.

The Asian unit of trading house Vitol submitted the lowest offers for the remaining oil products, which included up to 430,000 tons of gasoil, 50,000 tons of jet fuel, 40,000 tons of fuel oil and 30,000 tons of gasoline.

Vitol offered a premium of USD2.20 a barrel for gasoil, USD3.30 a barrel for jet fuel, USD24.98 a tonne for fuel oil and USD5.43 a barrel for gasoline. BPC had also awarded Unipec and Vitol a similar import tender to supply nearly 1.35 million tons of oil products in the second half of 2019.

A shortfall in supplies of natural gas has forced the South Asian country to burn oil, a costlier option, to generate electricity. BPC resumed issuing tenders for long-term contracts in 2016 as part of efforts to buy at cheaper rates after a 15-year hiatus, during which it negotiated directly with suppliers of fuel products.

Currently, BPC has term contracts with eight companies for refined oil product imports. Suppliers for Bangladeshs middle distillates contracts include Kuwait Petroleum Corp, Malaysias Petronas, Emirates National Oil Company, Thailands PTT, Indonesias Bumi Siak Pusako, PetroChina and Unipec.

Bangladesh has also signed a 15-year deal with Indias Numaligarh refinery to supply diesel, its first long-term contract with any Indian supplier, in which 60,000 tons will be imported in 2020. Bangladesh typically imports about 3.5 million tons of diesel and 2.5 million tons of fuel oil annually, making it one of the top 10 importers for those fuels in Asia.

BPC also buys 700,000 tons of Murban crude from Abu Dhabi National Oil Co annually and another 700,000 tons of Arab Light from Saudi Aramco for its only refinery.

As MRC informed earlier, Thailands PTT Global Chemical Public Co Ltd still has plans to shut two crackers at its petrochemical complex in Map Ta Phut in January 2020. The company might take two of its naphtha/mixed feed crackers offline for 35-40 days while there are no planned maintenances at other cracker units. The number 1 and number 2 cracker have a combined capacity of 915,000 tons of ethylene per annum. Thus, cracker No. 1 with a capacity of 515,000 tonnes of ethylene and 310,000 tonnes of propylene per year is scheduled to be shut for 40-day maintenance in late January, 2020, whereas cracker No. 2 with a capacity of 400,000 tonnes of ethylene and 50,000 tonnes of propylene per year is to be taken off-steam for 35-day turnaround in mid-January, 2020.

Ethylene and propylene are feedstocks for producing polyethylene (PE) and polypropylene (PP).

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 2,093,260 tonnes in 2019, up by 6% year on year. Shipments of all PE grades increased. PE shipments rose from both domestic producers and foreign suppliers. The estimated PP consumption in the Russian market was 1,260,400 tonnes in January-December 2019, up by 4% year on year. Supply of almost all grades of propylene polymers increased, except for statistical copolymers of propylene (PP random copolymers).
Author:Anna Larionova
Tags:petroleum products, crude oil, PP, PE, petrochemistry, Crude oil.
Category:General News
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