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Supply Of Lubricating Oil

BPC bars local companies from tender process

Published : Thursday, 26 November, 2020 at 12:00 AM  Count : 192

Bangladesh Petroleum Corporation (BPC) has barred local companies from participating in its new tender process of supplying lubricating oil to the government.
BPC, the state-owned principal petroleum marketing agency, has floated tender to supply 5,400 metric tonnes (MT) of lubricating oil to the government under a framework agreement.
It has also introduced some clauses barring local entrepreneurs from participating in the tender process, said a government source.
BPC set a condition in the eligibility provision of the tender that the supplier of 5,400MT lubricant oil must be a foreign manufacturer while supplier of such kind of products does not necessarily to be a foreign one.
About 15 local companies are engaged here in manufacturing lubricants through their blending plants are not getting the opportunity to participate in the tender process.
They are producing quality  lubricating oils in association with different world leading brands, Saifullah Kabir, Managing Director of Lub-rref (Bangladesh) Limited said.
"Despite having good experiences and capabilities as blender, supplier and exporter of     world class lubricants, local companies are not getting opportunity to participate in the tender process to supply the product," he added.
This is a tough condition which ultimately blocks local companies' participation in the bidding process while the most damaging condition is that no company having any partnership with BPC could participate in the bidding process, he said.
Meanwhile, MM Mukul Hossain, Chief Executive Officer (CEO) of the MJLBL, has already made an appeal to the BPC Chairman to remove the impediments by bringing some small amendments to the tender provisions to facilitate the company's participation.
Another condition of the tender is that the supplier has to have export experience of $15 million in last 5 years and minimum annual production capacity of 50,000MT.
Local industry insiders said it seems each of the conditions was set targeting the local companies to impede their participation in the bidding process.
But if a local company is given the opportunity to supply bulk lubricants to the government, it would ultimately help saving foreign currency and play a vital role in growing the local company, he added.
Mobil Jamuna Lubricants Bangladesh Limited (MJLBL), a maiden public-private partnership (PPP) company and a sister concern of the state-owned Jamuna Oil Company Limited (JOCL), established in partnership with EC Securities, has also failed to participate in the bidding process.
But MJLBL officials said some of the unnecessary provisions in the tender blocks its participation in the bidding process.
Officials said the MJLBL has been blending lubricants since its inception in 1988 as a partner of the global lubricant leader Mobil under a partnership between Mobil Corporation (after the merger known as Exxon Mobil Corporation).
JOCL, also a subsidiary of the BPC, has remained engaged in marketing of different petroleum products across the country for long.
"The decision to procure lubricating oil was taken as part of the government's instruction to import from foreign suppliers mainly to maintain the high standard and quality of the product," a senior official of BPC said preferring anonymity.
Meanwhile, JMLBL officials said it had been supplying different lubricating oils to local market to meet the growing demand in motor vehicles, locomotive engines, river, sea and ocean going vessels, aviation and power and other sectors of the country.
"We have been exporting our blended products to Nepal," said a top JMLBL official adding that the company envisioned that Bangladesh would be one of the few countries in the region to blend high quality lubricants.
He said as part of its vision, it had already commissioned a state-of-the-art Lube Oil Blending Plant (LOBP) - the first of its kind in the country - in May 2003.
Since then the production of this plant and marketing activities of MJL Bangladesh Limited have expanded greatly, he said.
He said, "We want a level playing field for local entrepreneurs and it is the government's responsibility to ensure it."

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