Dhaka: Modernizing and expanding the refining capacity of Eastern Refinery Limited, the country’s sole facility for converting crude oil into refined petroleum products, is finally set to see the light of day. This development promises to directly reduce Bangladesh’s reliance on imports, particularly in the refined petroleum sector.
According to United News of Bangladesh, the Jeddah-based Islamic Development Bank (IsDB) will provide over $1.0 billion in financing for the modernization project. A financing agreement titled “Modernization and Expansion of Eastern Refinery in Bangladesh” was signed between the Government of Bangladesh and the IsDB. Dr. Md Mizanur Rahman, Additional Secretary of the Economic Relations Division (ERD), represented Bangladesh, while Anasse Aissami, Director General of Country Programs, signed on behalf of the IsDB. The signing ceremony was witnessed by Prime Minister Tarique Rahman and IsDB Group Chairman Dr. Muhammad Al Jasser.
The ERD stated that the project will be implemented by the Bangladesh Petroleum Corporation (BPC) under the Energy and Mineral Resources Division. This funding is set to elevate the ongoing development partnership between Bangladesh and the IsDB, which operates as an instrument of the Organisation of Islamic Cooperation (OIC), to new heights. This marks the largest investment in a single project by the IsDB in Bangladesh to date.
Upon implementation, the refining capacity of Eastern Refinery-the country’s primary oil refinery-will increase from the current 15 lakh metric tonnes to 45 lakh metric tonnes per annum. The government anticipates that the project will enhance fuel supply capacity, reinforce national energy security, and enable the production of eco-friendly Euro-5 standard petroleum products.
Tripling the refinery’s capacity will significantly reduce Bangladesh’s dependence on imported refined oil, thereby saving foreign currency and ensuring stability in the domestic energy supply chain.
As one of Bangladesh’s key multilateral development partners, the IsDB has historically supported the nation through grants, project loans, trade financing, private sector funding, and export credit guarantees. Following the agreement signing, IsDB Group Chairman Dr. Muhammad Al Jasser paid a courtesy call on Prime Minister Tarique Rahman, reiterating the bank’s commitment to supporting Bangladesh’s development priorities. During the meeting, the Prime Minister emphasized the importance of concessional financing and assured full government cooperation to deepen the partnership between Bangladesh and the IsDB.