March 21, 2011

Bitumen Supply from IOCL to Bhutan- Weight Issue

A nexus between the Bhutanese supplier and their transporter might have resulted in underweight bitumen barrels entering Bhutan, according to the five-member investigation team from Indian Oil corporation limited (IOCL), the principle suppliers, who were in the country recently to investigate the issue.

The team, which was in Phuentsholing and Thimphu on a two-day visit from March 13, carried out a random verification of bitumen barrels of KSD Supplies and Bhutan Tshongley in Phuentsholing, where a shortfall of about five to 10kg were found, while some weighed two to five kilograms more. Water content was also found to be very high.

The investigation report was submitted to the trade department yesterday.

IOCL officials said, of the 60,000MT of bitumen they supplied in a month from their refinery in Haldia, West Bengal, around 15,000MT were packed in barrels. Of this, two to five percent of barrels a month were supplied to Bhutan. “The remaining quantity is supplied to other areas in West Bengal,” IOCL’s chief manager of consumer and sales division, Saibal Das, said. “No complaints on quality or quantity have been received from other areas, apart from Bhutan.”

Bitumen is a product supplied on ex-MI basis, meaning IOCL’s responsibility ceases once the product exits the gate of their premises at Haldia.

IOCL officials also asked trade officials to visit their refinery to be assured of the quality and quantity.

They said a representative of KSD Supplies visited the refinery to check the filling and stacking and a quality assurance letter was signed between KSD’s representative and IOCL.

KSD’s representative, Binay Jain, who visited the refinery, said it wasn’t an assurance letter he signed, but a report after random checking of bitumen barrels at Haldia. “They can’t make such baseless allegations,” he said, adding there was an excess of about 2.6 kg a barrel at the refinery.

Bhutanese contractors, who have imported bitumen in the past, said they have found old shoes and rags inside the barrels.

The senior divisional consumer sales manager, Sujon Bhattacharya, said there’s no scope for water at a temperature of 1130C. They said their refinery in Haldia followed standard norms in filling and stacking, where they do not put water, because at a temperature of 1130C, mixing water wasn’t possible as it led to huge expansion of foams inside barrels.

Sick and leaked drums are also instantly separated at the source, they said. Presence of foreign materials inside the drum wasn’t possible, since bitumen was directly pumped from filling machines and then sealed.

IOCL officials said tampering en route was possible, as many technologies were available for squeezing out bitumen from barrels within a short period of time, and that there’s a possibility to refill bitumen by a third party in barrels, which are similar to IOCL’s.

IOCL officials also said KSD and Bhutan Tshongley had the same transporter, Kalpana road carriers, while Bhutan bitumen had a different transporter, AS transporter, which did not report any discrepancies.

Bhutan bitumen, however, imports bitumen in tankers to process it in to emulsion, but faced a similar shortfall of about 200kg for a truckload, when they imported in barrels last month.

KSD Supplies said the investigation report is one-sided. “When no tampering is visible on the barrels, KSD won’t accept it,” the proprietor, KS Dhendup, said, adding that they were told the barrels were forklifted. “The fork marks were clearly visible on the barrels, with no tampering of any sort.”

Both the supplier Bhutan Tshongley and KSD said that their consignment from the IOCL always came within the stipulated time of three days from Haldia to Bhutan a distance of 850km. “We know that our transporters aren’t capable of doing it,” said KS Dhendup.

KSD supplies said they enquired with some transporters in India and found that there were cases where some faced a similar situation.

The issue started after Wangchuk Construction had bought 1,000 barrels of bitumen worth Nu 5.8M from KSD last month, but found that the consignment was short by Nu 1.1M in weight. The proprietor then filed a complaint with the trade department, and a joint inspection was carried out on February 12 by trade, roads and standard quality and control authority officials, in the presence of both the parties.

Apart from KSD, Bhutan Bitumen and Bhutan Tshongley, had also filed complaints with IOCL when the bitumen barrels indicated shortage in weight.

Bhutan Tshongley’s proprietor, Sangay Dorji said he doesn’t see any solution to the issue. “They are aware that there are no other alternatives for Bhutan,” he said. “We don’t have a choice but to go back to them,” he said. “I’ve told them that they are the god and whether they give us excess or less, we’ll have to take it anyhow.”

IOCL has been the sole supplier to Bhutan for the past 36 years.

By Kinga Dema &
Nidup Gyeltshen


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