Dhaka: A framework agreement was signed between China and Bangladesh on Sunday under which China will provide $ 550.40 million to Bangladesh to implement ‘Installation of Single Point Mooring (SPM) with Double Pipe Line’ project in a bid to ensure energy security of the country.

Of the total amount of $ 550.40 million, China will provide around $82.56 million under the Chinese government’s concessional loan while the rest of $ 467.84 million under its preferential buyer’s credit.

Economic Relations Division (ERD) Secretary Kazi Shofiqul Azam and Chinese Ambassador to Dhaka Ma Mingqiang signed the agreement on behalf of their respective sides at the ERD Conference Room in the city in presence of State Minister for Power, Energy and Mineral Resources Nasrul Hamid, reports the UNB.

The main objectives of the project under the Energy and Mineral Resources Division are to make balance between the demand and supply of the country’s energy need and ensure energy security in the country. It will also reduce the system loss during import of refined and non-refined fuel by literage operation.

Speaking on the occasion, Nasrul Hamid said although Bangladesh Petroleum Corporation (BPC) is one of the largest companies in Bangladesh with an annual turnover of $ 5 billion, but they are only tasked with importing oil and then sell.

‘But, this is for the first time, BPC is going for an infrastructure project,’he added.

He opined that the Single Point Mooring Project would be an eye opener for both Bangladesh and China in this sector. ‘We’re also going to set up two land-based LNGs where we’re looking for good partners and China could be a good partner.’

Nasrul Hamid also said that China will help Bangladesh in two big power sector projects of which one would be implemented by DPDC and another by PGCB.

He said that China is expected to disburse fund for the SPM project from the next January and it would take 36 months time to build two deep sea pipelines from the sea at the Eastern Refinery.

Once the SPM project is implemented, the oil unloading time will be reduced to only 48 hours from 12 days while the country would be able to save $100 million per year through addressing the system loss.

Chinese Ambassador to Dhaka Ma Mingqiang said that this SPM project is of vibrant importance to the country’s energy sector as it will save around $100 million per year side by side the unloading time will be significantly reduced.

Referring to criticism of some media over the past few weeks that the Chinese-funded projects are moving a bit slow, Ma Mingqiang said it is not that what will be said would be done overnight, but there are many phases like evaluation, approval, and sometimes, the bureaucracy matters.

ERD Secretary Kazi Shofiqul Azam said this fiscal year the foreign aid disbursement target is more than $7 billion of which $ one billion is expected to come from China.

China is one of the most important partners in the economic development of Bangladesh and providing financial assistance in various projects.