Ctg-Dhaka oil pipeline commissioning begins, full operation expected by April

After several delays, the commissioning of the 250-kilometre Chattogram-Dhaka oil pipeline began late Monday night, marking a major step towards a more efficient and cost effective fuel supply system in Bangladesh.

The pipeline, extending from Chattogram to Godnail in Narayanganj, has already supplied 50 million litres of fuel by 9am today, according to officials from the Bangladesh Petroleum Corporation (BPC) who expect the pipeline to be fully operational by April.

Once in full operation, it is likely to save hundreds of crores of taka annually by reducing transportation costs, minimising system losses, and lowering environmental pollution.

The BPC estimates that the Tk3,600 crore project will transport 30 lakh tonnes of fuel oil each year, leading to annual savings of Tk150 crore in transportation costs.

This is Bangladesh's first use of pipelines for oil transportation. The nation currently relies on coastal tankers, railway wagons, and tank lorries to distribute fuel after imports arrive at Chattogram depots from global suppliers.

"The commissioning [trial run] started on Monday night and will take about a month to assess all technical aspects. The contractor is expected to hand over the project after March," Anupam Barua, director of operations and planning at BPC, told The Business Standard.

"Construction was disrupted as workers and engineers faced access issues, along with delays in material transportation. However, we intensified efforts to get back on track, especially since the project has already been delayed four times," said Aminul Hoque, assistant director of the project.

"The project was scheduled for commissioning in December, but several technical complications caused further delays. Finally, we started on Monday night, and we are now checking for any faults. So far, everything is in order," he added.

Aminul further said the test run will be conducted in two phases – 20 days in the first phase and 10 days in the second.

"About 2 % of the project's work is yet to be completed, which will be done after the completion of commissioning. The project will be fully ready for handover by April," he added.

Currently, 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 system costs approximately Tk150 crore per year and is vulnerable to pilferage, causing significant financial losses to BPC.

Project details and future expansions

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. 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, with an additional 8.29 kilometres of pipeline with a 10-inch diameter is set to connect Godnail to Fatullah.

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.