India to build diesel, gas pipelines to Bangladesh

A worker checks pipes and valves at Amaal oil field in eastern Libya October 7, 2011. Eight months of civil war have left Libya's oil industry in chaos, with fields that once pumped a total of around 1.6 million barrels per day (bpd) deserted and export terminals, pumping stations and pipelines damaged by fighting and sabotage. Engineers and other workers who left the field, which is about 1000 km (620 miles) southeast of the capital Tripoli, are returning in what the country's new rulers hope will be the resumption of full oil production as soon as possible. REUTERS/Ismail Zitouny (LIBYA - Tags: CONFLICT BUSINESS ENERGY TPX IMAGES OF THE DAY) - RTR2SD29

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India will build pipelines to carry diesel and natural gas to Bangladesh as the world's third largest energy consumer looks to strengthen ties with the neighbour.

While a 131-km pipeline will be laid from from Siliguri in West Bengal to Parbatipur in northern Bangladesh to transport diesel, a line from Dattapulia in West Bengal will take natural gas to Khulna, the third-largest city of Bangladesh.

Oil Secretary K D Tripathi today said the pipelines are part of a non-binding Framework of Understanding (FoU) which India will enter into with Bangladesh for cooperation in the hydrocarbon sector.

The Cabinet had yesterday approved signing of the agreement to establish an institutional framework mechanism for facilitating and enhancing India-Bangladesh bilateral cooperation in the hydrocarbon sector, he told reporters here.

As part of the cooperation, India is looking at setting up a liquefied natural gas (LNG) import terminal in Bangladesh, supplying diesel from Numaligarh Refineries Ltd and selling LPG, he said. Sunjay Sudhir, Joint Secretary (International Cooperation) in the Ministry, said during the visit of the Bangladesh Prime Minister Sheikh Hasina that a 15-year agreement to supply diesel to Bangladesh was signed.

To begin with, diesel will be supplied through train, moving one rake containing some 2,200 tonne fuel from Numaligarh Refinery's Siliguri terminal to Parbitipur depot of Bangladesh Petroleum Corp (BPC), he said.

Till July one rake per month will be moved and thereafter two rakes a month will travel some 516 km -- 253 km in India and 263 km in Bangladesh -- on an existing rail line to transport diesel. He said India will bear the cost of laying the Indo- Bangla Friendship pipeline from Siliguri to Parbatipur, with a carrying capacity of 1 million tons of fuel a year.

Also, India is looking at supplying gas to Bangladesh, he said. Under the proposal, LNG will be imported at the under- construction Dharma terminal in Odisha and gas transported through pipeline up to Dattapulia in West Bengal. A 70-km pipeline will be laid to Khulna for moving the gas.

Tripathi said an MoU for Petronet LNG Ltd to set up a Rs 5,000 crore LNG import terminal at Kutubdia islands in Bangladesh has also been signed during Hasina's visit. Petronet was one of the five global energy firms shortlisted for setting up the 3.5 million tonne LNG import terminal.

The others shortlisted included Anglo-Dutch super- major Shell, China's Huanqiu Contracting & Engineering, Tractebel Engineering of Belgium and Japan's Mitsui. Indian Oil Corp (IOC) is looking to transport LPG to north eastern states via Bangladesh.