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Bitumen Industry

Bitumen Industry

The ever-expanding road network across the country has kept the demand for bitumen on a constant rise. But in the absence of adequate supply of quality bitumen, substandard products have flooded the market, making roads and highways susceptible to early damage. Bitumen is an oil-based substance. It is produced by removing the lighter elements, such as LPG, petrol and diesel, from heavy crude oil while refining. The vast majority of refined bitumen is used in construction, primarily as a constituent of products used in paving and roofing.
Bangladesh has 21,000 km of road networks under the Roads and Highways Department (RHD) of the road transport and bridges ministry. The Local Government Engineering Division (LGED) has built another 100,000 km of metalled roads.
The present demand for bitumen is 370,000 tonnes against a supply of 250,000 tonnes. The deficit — 120,000 tonnes — is nearly a third of the total demand. Stakeholders in the sector said that out of 250,000 tonnes, only 70,000 tonnes supplied by the state-owned Eastern Refinery Ltd (ERL) are of good quality. Some private companies import the rest. The largest of the private bitumen importers is the PHP Group of Chittagong.
RHD officials said construction of the Dhaka-Mymensingh and Dhaka-Chittagong highways have pushed up the demand for bitumen, especially since the dry winter season is the peak season for construction.
Chief engineer of the RHD, Firoz Iqbal, said next year would be crucial for both projects. “We will need a huge amount of bitumen for carpeting. If it can’t be supplied, the projects will be delayed,” he said.
AFM Rashiduzzaman, chairman of Zaman Construction and Consultants Ltd, a listed contractor of the RHD, told The Independent that for construction of roads and highways, they always prefer the bitumen of the ERL because it’s of good quality.
“When we get a contract to build a road, we also get the duty to maintain it for some time. If substandard bitumen is used, the road is damaged within six or seven months, especially during the rainy season,” he said.
Mursalin Ahmed, an engineer with Nippon Construction Ltd, said if low-grade bitumen is used, the road surface wears off too soon. “The ERL bitumen is the best in the market right now. We always ask our supplier for it,” he said.
But the government’s plan of doubling the local bitumen production at the ERL has come to a standstill with the fate of its expansion being stuck in a limbo.
To reduce the growing demand-supply gap in the construction sector, the Prime Minster’s Office (PMO), at the RHD’s
request, had directed ERL two years ago to build a new unit for bitumen production. However, GMA Afzal, managing director of ERL, said the project was dependent on the expansion of the eastern refinery.
“In our mega plan for the second unit of the refinery,
we have incorporated some other plans, including a new unit for bitumen production. So without the expansion of the refinery, we can’t start the project for bitumen production,” said the MD.
Afzal said that recently, ERL has completed the third phase of paperwork for inviting new expressions of interest to appoint a project-management consultancy firm that would prepare a proposal to invite companies for the ERL expansion project.
“We will start the paperwork for construction of the bitumen production unit very soon,” said Afzal.
He said currently the total capacity of bitumen production of ERL is around 70,000 tonnes. “We are producing two types of bitumen — grade 80-100 or soft bitumen and grade 60-70 or hard bitumen,” he explained.
The price of soft bitumen is Tk. 63,000 per tonne and the other is priced at Tk. 68,000 per tonne. A 150 kg drum of soft bitumen is sold at Tk. 10,300 and a 150 kg drum of hard bitumen is sold at Tk. 11,000, he said.
“The bitumen we produce is the best in the country and has high demand among contractors,” Afzal added.
Md Abu Hanif, former general manager (marketing) of the Bangladesh Petroleum Corporation (BPC), also feels that the bitumen produced by ERL is the best and is highly sought after by contractors.
“ERL bitumen is distributed to the Padma, Meghna and Jamuna oil companies and the contractors get bitumen from these through work orders. Since the demand for the ERL bitumen is high, we don’t sell it in the open market,” he explained.
He said that a section of contractors would previously get the bitumen from the BPC and sell it in the open market at higher rates. To stop this, ERL has now set this condition of submitting a work order first.
But some private importers still buy bitumen from Iran and sell it in the open market at Tk. 7,500 per 150 kg drum, he said. “To stop such practices and to increase production, there is no option but to build the second unit,” said Hanif.

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