Eastern Refinery Limited posted its highest crude oil processing volume and financial performance in its 57-year history during the 2024-2025 financial year, company records show. The performance comes as the state-owned refinery advances a major expansion project valued at Tk 31,000 crore, approved by ECNEC in December 2025.
Managing Director Engineer Sharif Hasnat assumed leadership in August 2024, following the political transition, and has overseen the refinery during a period of operational expansion and project development alongside record production numbers.
Record Production Year
The refinery processed 1.535 million metric tonnes of crude oil in FY 2024-2025, exceeding its 1.5 million tonne annual capacity for the first time in its history. This represents approximately 35,000 tonnes above the facility's rated capacity.
The ERL team’s diligence went on to record their highest net profit and made the largest deposit to the national treasury in the company’s history.
"Achieving this year's output required consistent supply of crude oil and continuous operation and maintenance," Hasnat told the press in July 2025. "Several factors aligned to help us utilize the full refining capacity."
Modernization Project Approval
The Executive Committee of the National Economic Council approved the "Modernisation and Expansion of Eastern Refinery Limited" project on December 23, 2025, at a total cost of Tk.15 crore. The government will provide Tk 21,277.59 crore through loans, with ERL financing the remaining Tk 14,187.56 crore from its own resources.
The project cost was reduced from an initial estimate of Tk 35,365 crore after Planning Commission review. The approval came after the interim government cancelled a previous arrangement with S Alam Group and opted for state financing.
The project underwent multiple revisions between 2020 and 2024 before receiving final ECNEC approval.
Project Scope and Timeline
Implementation is scheduled from December 2025 to November 2030. The project will triple ERL's crude oil refining capacity from 1.5 million tonnes to 4.5 million tonnes annually.
The modernized refinery will produce Euro-5 standard gasoline and diesel, meeting international environmental standards. The facility will be capable of processing crude oil from diverse sources including the Middle East, Russia, Norway, and Nigeria, according to Energy Division officials.
Once operational, the expanded refinery is expected to meet 45-50% of Bangladesh's petroleum demand, compared to the current 20%. This would significantly reduce the country's dependence on imported refined petroleum products.
Supporting Infrastructure Complete
Bangladesh Petroleum Corporation completed the Single Point Mooring (SPM) installation with double pipeline in February 2024. Hasnat served as project director for the SPM during its implementation phase.
The SPM facility, located 16 kilometers off the Moheshkhali coast having total pipeline length of up to 220 km (including 110-120 km of double pipeline) to transport fuel from the offshore buoy to the Eastern Refinery. It enables direct crude oil transfer from ocean tankers to storage tanks and the refinery. The system can transport up to 4.5 million tonnes of crude oil annually, reducing transfer time from 10-12 days to approximately 48 hours.
Despite being the most technologically complex project, it was successfully completed during the coronavirus pandemic in line with the country's priorities.
Oversight and Governance
The modernization project operates under Bangladesh Petroleum Corporation's oversight framework, which includes technical evaluation committees, procurement committees, and review by the Bangladesh Petroleum Exploration Company.
Each major procurement decision requires approval from multiple oversight bodies. Foreign and domestic technical experts provide input on design specifications and implementation plans.
The project includes 20 processing units and 18 utility and off-site units. Work is being divided into phases to allow continued refinery operations during construction.
Development History
Plans for expanding ERL were first developed in 2010. The government approved the project in 2013, but implementation did not proceed. BPC attempted to revive the plan in 2022 but work again stalled.
Finally, the project was approved in December 2025 with a budget of Tk 35,465 crore after a reduction from Tk 42,973.70 crore, reflecting inflation, expanded scope, and updated technical specifications. The interim government's decision to pursue state financing rather than foreign partnership or PPP arrangements represented a shift in implementation strategy.
The Islamic Development Bank also expressed interest in providing up to $1 billion in financing for the project, which could revise the funding structure, according to Economic Relations Division officials.
Industry Context
Eastern Refinery Limited, established in 1968, is Bangladesh's only state-owned petroleum refinery. The facility has operated without major expansion for over five decades.
Bangladesh currently imports approximately 6-7.5 million tonnes of refined petroleum products annually at significant foreign exchange cost. The modernization project represents one of the largest infrastructure investments in the country's energy sector.
Over the past 50 years, no effective energy security system has been established for Bangladesh. Through Unit-2, a meaningful and effective step has finally been taken ensuring the country’s energy security for a vibrant economy.
The refinery operates under ISO certifications and follows international standards for quality management and occupational health and safety systems.
