An Internship Report

On
Overall Activities of
Meghna Petroleum Limited

Internship Report On
1
 Overall Activities of
Meghna Petroleum Limited.
(Internship report is Submitted For the Partial Fulfillment of the Degree of Bachelor of Business of
Administration with a Major in Finance)

Submitted To:
Mr. A.H.M Shamsud Duha
Managing Director
PADMA Oil Company Limited
Strand Road, Sadarghat
Chittagong.

Prepared By
Name: Ireen Akter Mily
Roll No. 9950268
Registration No. 9999678
Program: BBA
Semester: 8th
Major in Finance

DATE OF SUBMISSION:

16-06-2014

Letter Of transmittal

Date:

To
The Supervisor
2
NCC Neural
Chittagong.

Sub: Submission of Internship report titled “Overall Activities of Meghna Petroleum Limited”.

Dear Madam
With the respect, I state the fact for your kind consideration that, I have to perform 2 month
internship program due to BBA course outline to acquire practical knowledge about the
present trend of MPL.

You will be interested to note that MPL is a subsidiary of Bangladesh Petroleum corporation
which marketing the Petroleum Oil and Lubricants. I try to focus the problems, prospects and
performances of my company in this report, with my all efforts.

May, I therefore, pray and hope that you would kindly accept my Internship report errors and
omission should be considered and oblige thereby.

Sincerely yours

Name:

( )
Name: Ireen Akter Mily
Roll No. 9950268
Registration No. 9999678
Program: BBA
Semester: 8th
Major in Finance

Acknowledgement

At first all praise and indebt ness to the Almighty Allah, the Lord of Glory and Honor and his Friend
our Prophet Mohammad (SM), for all the blessing showers upon me to make such a success.

In order to present the Internship Report to the Instructor of our department I proceeded to the
Meghna Petroleum Limited with the recommendation letter from the department. Gradually I

3
obtained the permission from the authority and started the Internship program with, Meghna
Petroleum Limited, Agrabad, Head Office, Chittagong.

I would like to offer a special thanks to my supervisor and the authority of NCC Neural.

During my internship program I attended the office regularly in the office time in order to collect
data and to observe the every day operating system of the Meghna Petroleum Limited.

It beings a part of academic study with practical implication. This study has been initiated to explore
the General activities, Account, ERL, finance, audit, HRM activities of Meghna Petroleum Limited.

In this regard, I would like thank my Managing Director, Mr. Md. Abul Khair, DGM (Operation),
Mr. Md. Alim Uddin, DGM (ER) Mr. Md. Masudur Rahman, DGM (Finance) Mr. Md. Kamrul
Hossain, AGM (Finance) Mr. Kazi Monowar Dilder, AGM (ER) Mr. Md. Akther Hossain.
At last numerous thanks to almighty Allah for pouring his blessing in every moment.

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 Executive Summary

Meghna Petroleum is a subsidiary of Bangladesh Petroleum Corporation (BPC), had been serving
the nation for the last four decades through marketing of petroleum product. The aim of the company
is to earn profit through consumer satisfaction & to deliver the product at the right time, at the right
place & right quantity. MPL do not produce my product they receive the product from ERL as per
share. Meghna Petroleum Limited has sales activities in whole country divided in 4 regions. These
are (1) Chittagong region (2) Dhaka region (3) Bogra Region and (4) Khulna region.
The price of the Bulk product are set by the government, they receive a margin for it. They offer
three incentive program in a year to increase the sales. They transport their product through river,
railway, road. They do business through dealer, agent, and customer. They sells in cash, They also
credit sales army, navy, defence, PDB, Bangladesh Railway. They sells the product through pay n
slip, DD, In MPL there are 2 worker union organizations for collective bargaining with management
for different aspect for the benefit of the workers, namely- Meghna Petroleum Sramic Karmachari
Union, Registration No-B-1743 & Meghna Petroleum Sramic Union, Registration No-B- 1833.
During 2009-2010, company’s net sales of all kinds of Petroleum Products (including Lubricating
Oils) were 11.96 Lac Metric Tons of sales value of Tk. 646386.35 lac. Market share participation of
MPL was 35.23 in Fuel, LPG & Bitumen and 47.10 (7523 MT) in Lubricants (among the three oil
marketing companies). During the year the countries overall petroleum product has been increased
by 3.50 Luc M.Tons.

Table of Content
Content Page no
Title Page i
Cover Page ii
Letter of Transmittal iii
5
Acknowledge iv
Executive Summary v
Chapter – One
1.0 Introduction
1.2 Objectives of the study: 1-4
1.3 Scope of the study
1.4 methodology of the study
1.5 Limitations of the study
Chapter – Two
2.1 Meghna at a Glance
2.2 Historical Background of MPL
2.3 Vision of the MPL
2.4 Company philosophy 5-12
2.5 Company Objectives
2.6 Company Goals
2.7 Company Rules & Regulations
Chapter – Three
3.0 Function of ERD
3.1 Introduction of ERD
3.2 ORGANOGRAM OF EMPLOYER RELATIONS DEPARTMENT
3.4 Practice of human Resource Management in MPL.
3.5 Sales & Marketing Department
3.6 Introduction of Marketing Department 13-34
3.7 Organogram of Marketing Department:
3.8 Companies Marketing Activities:
3.9 Marketing Management Process of MPL
3.10 Introduction of Sales Department:
3.11 Technical Services
3.12 Functions of Planning & Economics Department
3.13 Functions of Engineering Departme

Chapter – Four
4.0 Operations Department
4.1 Introductions of Operations Department:
4.2 Organogram of Operations Dept:
4.3 Functions of Operations Department
4.4 Deport: 35-62
4.5 Introduction of Main Installation.
4.6 Functions of Main Installation
4.7 Introduction of S&D
4.8 Functions of Supply and Distribution Department:
4.9 Introduction of Purchase Department
4.10 COMPANY’S PURCHASING PROCEDURES:
4.11 Section of Accounts & Finance:
Chapter – Five
5.1 Problems 63-66
5.2 Recommendations
5.3 Conclusion

6
7
 Chapter – One
Introduction

1.0 Introduction

Padma Oil Limited, a subsidiary of Bangladesh Petroleum Corporation, is engaged in Procuring,

storing and marketing of Petroleum products, lubricants and greases, bitumen and Liquefied
Petroleum Gas (LPG) throughout the country. The company get the entitled to market the products
from Bangladesh Petroleum Corporation (BPC), which import finished products and crude product
8
(Subsequently convert it into finished products) as per country’s requirement. It gets the lubricants
products from British Petroleum Company plc (BP) London. The company perform its operation
through is main installation at Guptakhal, Potenga, Chittagong and 16 upcountry Depots throughout
the country, It has appointed a lot of dealers, (Filling Station), Distributors, packed point dealer’s to
market petroleum products and LPG Dealers for marketing of LPG gas throughout the country.

None of us are beyond of marketing. Without ensuring proper marketing let alone a firm, not even a
man can think of its long existence in a present competitive world. At present there are three oil
marketing companies owned by GOB engaged in marketing of petroleum, oil & lubricants (POL) in
Bangladesh. Padma Oil Limited (POL) has a long history of operation in oil sector with wide
network and distribution channel. It has also great contribution in establishing equal price for
petroleum products all over the country with proper supply. POL was offload its 30% shares, it will
require more transparency and more operational and financial efficiency,

1.2 Objectives of the study:

. The other objectives are as follows,

1) To know about the managerial activities of POL.

2) To know about the marketing activities of POL.
3) To find out the market position of the POL in the oil marketing companies.
4) To know about the import process of POL.
5) To monitor the sales volume of POL in different category.
.

9
1.3 Methodology of the study:
The information and the data have been collected after attending the internship program. Both
primary and secondary sources of data are being used, these sources are as follows.
Secondary sources:
 Different Publications of Padma Oil.
 Different Publications of BPC.
 Web sites of BPC,Pol, MPL, Related ministries, divisions and departments of GOB.

1.4 Limitations of the study:

All efforts have been made to arrange all the collected data and information in the present form of
the report. The main limitations are:-
1) Lack of sufficient data & information.
2) Lack of harmonious relationship & close contract between the officials of the organization.
3) Lack of financial support.
4) The study requires experience to be fruitful but it was completely absent to me.

Despite of numerous problems with limitation & Bottlenecks, I tried my best to make the report
more information with recent data, so as to arouse high satisfaction to my respectable teacher as per
his expectation. .

10
 Chapter-2
Overview Of the Company

11
Padma Oil Company Limited is not only the biggest but also the oldest with its antecedents stretching well back to the
colonial period of British-India. Its ancestral enterprise 'Rangooon Oil Company' established petroleum business in this
part of the world by the middle of the nineteenth century. Following is a synopsis of Padma Oil Company's historical
background;

1.In 1871 'Rangoon Oil Company' was registered as a joint stock company in Scotland having its main business activities
in Burma (Known to the British until the later years of the 19th century as Burmah, which was a province of the then British
India). 
2. In 1885, Rangoon Oil Company was reconstituted and reformed as Burmah Oil Company. Business of this company
was then spread over other provinces of British India, including Assam and Bengal. The Company's Head office was at
191 West George Street, UK.

3. Burmah Oil Company for the first time introduced drilling equipments for exploration of Oil in Burma in the year 1888.
Previously oil was being collected in Burma by hand dug well.

4. Burmah Oil Company established their 'Moheshkhal Oil Installation' at Chittagong in the year 1903.

5. In 1908, Burmah Oil Company conducted a geological survey in Chittagong.

6. In 1914, Burmah Oil Company drilled a well at Sitakunda, Chittagong.
7. In the year 1920, M/s Bullock Brothers, a major distributor of Burmah Oil Company established their trading office at
Sadarghat, Chittagong.
8. In the year 1929, Burmah Oil Company took over the office of Bullock Brothers at Sadarghat, Chittagong including 4.1
acres of land and established their own office there.
9. Prior to the partition of the sub-continent in 1947, mainly two oil marketing companies namely Burmah Oil Company
(BOC) and Burmah Shell Oil Storage and Distribution Company (BSOC) were operating petroleum business in the area
what now comprise Bangladesh. Burmah Shell established Aviation Depot at Tejgaon Airport in the year 1948.

10. Considering the Oil Marketing situation in erstwhile East Pakistan, Burmah Shell Transferred their share to BOC and
in the year 1965 a new company called 'Burmah Eastern Limited' was formed with 49 per cent share of BOC. The rest
portion of the share was issued to public and private individuals of Pakistan.
11. In 1977, Burmah Eastern Limited became a subsidiary of Bangladesh Petroleum Corporation.
12. In the year 1985, BOC transferred its entire property in Bangladesh (including share of Burmah Eastern Limited) in
favour of Bangladesh Petroleum Corporation (BPC)
As per terms of the transfer of BOC, Burmah Eastern Limited was required to change its name and as such subsequently
the company's name was changed as 'Padma Oil Company Limited' in the year 1988.

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Mission:

To be the leader in oil marketing industries in Bangladesh in terms of efficiency, capital adequacy, asset quality, sound
management and profitability having strong liquidity.

Vision

To build an efficient, market-driven and customer-focused institution with a good corporate governance structure.
Continuous improvement in our business policies, procedure and operations through Integration of technology at all
levels.

To have sustained growth, broaden and improve range of products and services in all areas of Bangladesh with the aim
to add increased value to share holders' investment and offer highest possible benefit to our customers.

PADMA BHABAN, STRAND ROAD CHITTGONG –

CORPORATE 4000,BANGLADESH
HEADQUATERS:
RESIDENT OFFICE: 6 PARIBAGH, DHAKA, BANGLADESH
MAIN
GUPTAKHAL, PATENGA, CHITTAGONG, BANGLADESH
INSTALLATION:
YEAR OF
27 APRIL 1965
INCORPORATION:
PROCURING, STORAGE AND MARKETING OF PETROLEUM
BUSINESS LINE: PRODUCTS,LUBRICANTS & GREASES,BITUMEN AND
LPG,MANUFACTURES & MARKETING OF AGRO CHEMICALS
LISTING STATUS: PUBLIC LIMITED COMPANY
DHAKA STOCK EXCHANGE, CHITTAGONG STOCK
STOCK EXCHANGE:
EXCHANGE
AUTHORIZED
1000 MILLION TAKA
CAPITAL:
PAID UP CAPITAL: 661.50 MILLION TAKA

13
NUMBER OF
66.15 MILLION
SHARES:
NUMBER OF
14,063
SHAREHOLDERS:
NUMBER OF
993
EMPLOYEES:

Padma oil-Directors Panel

Md. Eunusur Rahman Chairman,Bangladesh Petroleum
Chairman Corporation,BSC Bhaban,Saltgola,Ctg-4100

Mamtaz-Ala-Shakoor Ahmed Joint Secretary Finance Division, Ministry of

Director Finance, Dhaka

Md. Masud Sadiq Commissioner of Custom,Custom

Director House,Chittagong.

Dy. Secretary (Operations-1).Energy & Mineral

Begum Farzana Mamtaz
Resources Division, Ministry of Power, Energy &
Director
Mineral Resources, Dhaka

Mohammed Abdul Awwal

Chairman. Bengal Shipping Lines Ltd. Chittagong
Director

AKM Afzalur Rahman Babu Managing Director, Landmark Footwear Ltd.

Director Baridhara, Dhaka

Ahmed Jamal Khan Chowdhuri CEO Dairy Farm Project of the Consolidated Tea
Independent Director & Lands Co. Ltd. Dhaka

Md. Abul Khair Managing Director, Padma Oil Company Ltd.

Director Chittagong

14
 Corporate Management
Md.Abul Khair
Managing Director

Md. Kazi Ali Hossain

GM (Marketing)

Helal Ahmed Chowdhury

GM (Finance)

Khondakar Sarwarul Alam

DGM (Chemicals)

Swapendau Sekhar Gayen

DGM (P&A)

Naresh Chandra Das

DGM (Dhaka)

Ataur Rahman
DGM-CA

Kafil Uddin Mahamud Chowdhury

DGM (Sales)

Mohiuddin Ahmed
DGM (Audit) & Company Secretary

Akter Udduza
DGM (Chemical Prog.Co-ord)

M. Enayet Kabir Chowdhury

DGM (Aviation)

Md.Abu Saleh Iqbal

DGM(Operations)

Md. Numan Ahmed Taffader

AGM(E&P)

15
Major Petroleum Products of Padma Oil Company

Revised
Short Effect
Product Name Unit Price(TK Remarks
Name From
)

HIGH SPEED DIESEL 30/11/199

HSD litter 42.71
OIL 9

SUPERIOR KEROSENE 29/11/199

SKO Litter 43.13
OIL 9

29/11/199
MS MOTOR SPRITE Litter 71.79
9

HIGH OCTANE
29/11/199
HOBC BLENDING Litter 74.81
9
COMPOUND

29/11/199
FO FURNACE OIL Liter 26.00
9

29/11/199
JBO JUTE BATCHING OIL Liter 45.70
9

29/11/1999
LDO LIGHT DIESEL OIL Litter 45.70

Minor Petroleum Products of Padma Oil Company

Padma Lubs
Revised
Effect
Type Product Name Unit Price(TK Remarks
From
)

16
 5
PADMA SUPER ENGIN 29/11/199
Engine Oil Liter 645.79
OIL 9
Can
5
Automative AUTO GEAR OIL 90 29/11/199
Liter 698.64
Gear Oil EP/140 EP 9
Can
205
Industrial INDUSTRIAL GEAR OIL 29/11/199
Liter 136.14
Oil 68/100/150/220/320/460 9
Drum
205
HLP OIL 29/11/199
Hydrolic Oil Liter 125.42
32/46/68/100/150/220 9
Drum
205
BOC SUPER SPINDLE 29/11/199
Spindle Oil Liter 190.00
OIL ISO 10 9
Drum
Padma Greases
Revised
Short Effect
Product Name Unit Price(TK Remarks
Name From
)
180
WROG COMPOUND 29/11/199
KG 146.00
A/C/D/E/F/G/H 9
Drum
Padma LPG
Revised
Short Effect
Product Name Unit Price(TK Remarks
Name From
)

Cylinde 29/11/199
LPG FILLED CYLINDER 678.00
r 9

01/01/197
LPG EMPTY CYLINDER
0

Padma Bitumen
Revised
Effect
Short Name Product Name Unit Price(TK Remarks
From
)
29/11/199
BITUMEN BITUMEN 80/100 Drum 6350 9

17
 Other Petroleum Products of Padma Oil Company

Revised
Short Effect
Product Name Unit Price(TK Remarks
Name From
)

29/11/199
OCTANE 100/130 OCTANE 200.00
9

29/11/199
MTT MINERAL TURPENTINE 48.00
9
 

Agro Chemical Products of Padma Oil Company

Revised
Short Effect
Product Name Unit Price(TK Remarks
Name From
)

29/11/199
FURADAN FURADAN 5G
9

29/11/199
MIPCIN MIPCIN 75WP
9

29/11/1999
RIPCORD 10EC

Company Objectives:
 To maintain consumer rights.
 To deliver product within specific time with good quality.
 To promote employees
 To motivate employees for better service

18
  To pay Govt. Tax, Duty, Vat etc.
 To increase profit with minimization of cost.

ERD looks after the Company rules & regulations. These are
1) Maintains the office hour and attend the office just in time.
2) Enjoy leave by maintaining the company’s leave policy.
3) By getting the permission of Managing Director and need of the company, company will send the
employee for office tour and that employee will receive transport allowance & daily allowance as
per company rules.
4) If an employee has any potentiality and good quality & qualification, he will get yearly
increments.
5) If an employee are transferred by company one office to another then he or she will get transfer
benefit as per company rules.
6) Medical allowance also offered by the company for its employee himself/herself, his/her wife/
husband, children who are less than 18 years old and also parents if they stay with them.
7) As per company rules employees will get yearly two bonuses.
8) Employees should always give priority of the company interest.
9) Employee’s salary and other allowances are fixed by Government & Board of Directors.
10) Every employee should try to hard & soul for the better service to the company with sincerity,
honest, patience, experience, responsibility, dedication & concentration.
11) Employer & every employee must keep secret any kind of information of the company.
12) Employee does not have any right to involve with labor organization.

19
 Chapter - Three
Activities Of Padma Oil

20
 Five Years Sales Performance
Quantity in M. Ton:

PRODUCT 2005-06 2006-07 2007-08 2008-09 2009-10

HOBC 45316 34167 33029 29259 31668

MS 47866 40909 38499 34054 38199

SKO 191799 166414 153851 126819 145375

HSD 855261 814442 830587 805551 910521

LDO 0 0 0 0 0

FO 87230 66432 61514 45999 36243

JBO 4914 3750 3972 3299 5052

LUBE/GR 8397 6490 8076 6823 7523

LPG/Battery Water 5094 3839 3722 2963 4003

BITUMIN 19485 17928 13022 12288 17245

TOTAL 1265362 1154371 1146272 1067055 1195829

Sales & Marketing Department:

Introduction of Marketing Department:
Marketing is very important part of an organization. Companies profitability mostly depend on the
marketing activities. So the importance of marketing is boundless.
Meghna Petroleum Limited is a marketing company. The company does not manufacture anything.
It markets there POL products tart are received from two Eastern Refinery Ltd. (ERL) and Direct
Import. MPL can not import petroleum products directly. Bangladesh Petroleum Corporation (BPC)
imports two types of petroleum products.
a) Refined Oil : Every year BPC imports 70% of total requirements of Bangladesh and
distributes by turns among the three marketing companies i.e. POL, JOCK and POCL
as per their requirement.
b) Crude Oil: The rest of the total requirements i.e. 30% is imported as crude oil by BPC
and sent to ERL for refining. After ERL distributes the products among three oil
marketing companies according to their market share.
Companies Marketing Activities :

21
The Companies Marketing Activities are as follows:
1. To monitor dealers sales, receive and stock and keep them running.
2. Agent can receive product from others competitors so that we have to be aware about their
activities.
3. Visit direct customer and keep them good relation & ensure better service increase business
with them.

Organogram of Marketing Department

Padma Petroleum Ltd.

Sales & Marketing Organogram

General Manager
(Marketing)

DGM DGM DGM DGM

(P & E) (Sales) (Operation) (Engineering)

AGM(Chemical Sales)
AGM(Direct Business)

AGM(Technical Service)
AGM(Retail Trade) (Technical Service)
AGM(Chittagong)
AGM(Agency)

AGM(Khulna)

AGM(Dhaka)
AGM(Bogra)

(Sales)Central A/cs

Manager(Sales),H/O
Manager
Manager (Sales)

Manager (Sales)
Manager (Sales)

Manager (Sales)

Manager

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Marketing Management Process of POL:
The marketing management process consist of analyzing marketing opportunities, selecting target
markets, developing the marketing mix and managing the marketing effort. The marketing
management process of POL is given below.

Analyzing Market Opportunities :

Marketing research and information system
Consumer Markets
Organization Markets

Selecting target markets:

Measuring and forecasting demand
Market segmentation targeting and positioning

Developing marketing mix:

Designing products
Pricing products
Placing products
Promoting products

Managing the marketing

Competitors analysis and competitive
Planning, implementing and controlling
Marketing programs

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Marketing research of
Marketing research is the faction that links the consumer, customer and public to the marketer
through. Information are used to identify and define marketing opportunities and problems to
generate, refine and evaluate marketing actions to monitor marketing performance and to improve
understanding of the marketing process.

Research methods (a) Observational research

The research officer gathers primary data by observing the number of irrigation projects number of
ships, new industries coming up increase of vehicles, actions and situations. Observational research
is used to obtain information that consumer of POL products are unable to provide.

(b) Survey research:

Survey research is the approach best suited for gathering descriptive information. POL wants to
know about the users knowledge, attitude performance or buying behavior of petroleum products
asking them directly.

(c) Laboratory research

This method is used by POL to test the quality and quantity of the petroleum products. When the
customers complain about the quality, grades and colour variation of the POL products of MPL, this
type of research in laboratory is arranged.

Selecting the target markets:

It is impossible to satisfy all consumers in a given market, at least not all consumers in the same
way. There are too many different kinds of consumers with too many different kinds of needs. We
select four (4) steps:
1. Demand measurement and sales forecasting.
2. Market segmentation.
3. Marketing targeting and
4. Market positioning.

24
Demand measurement and sales forecasting :
The total market demand for a product or a service is the total volume that would be bought by a
defined consumer group in a defined geographic are during a defined time period in a defined
marketing environment under a defined level and mix of industry marketing effort. Forecasting is the
art of estimating future demand by anticipating what buyers are likely to do under a given condition.

Market segmentation:
Market consists of buyers and differ in one or more ways. They may differ in their wants resources
and locations, buying attitudes buying practices. Any of these variables can be used to segment a
market. Market segmentation is the act of dividing a market into distant groups of buyers who might
call for separate products of marketing mixes. Its segments its total market into four regions.
They are:
1) Chittagong region
2) Dhaka region
3) Khulna region
4) Bogra region
On the other hand, MPL segments total market on the basic of business characteristics, which are as
follow:-
1) Retail trade business.
2) Reseller business
3) Direct business.

Market target:
Market segmentation reveals the market segment opportunities facing a firm. The firm now has to
evaluate the various segments and decide the number of segments. Market targeting is the act of
evaluating each market segment to enter. POL targets those who use POL products and to serve them
in a better way than other oil marketing companies.
Market Positioning:
Market Positioning is the arrangement for a product to occupy a clear distinctive and desirable place
relative to competing products in the market of target customer. POL determines positions that
distinguish its lubricating oil from competing products and that give it the greatest strategic
advantage. For example, POL is in the position to say for liberating oils “Use BP engine oils. We
have the right oil for your engine”.
25
Developing the marketing mix:
The marketing mix consists of everything the firm can to do influence the demand for its products.
The many possibilities can be collected into four groups of variables known as the 4 Ps:
1) Product
2) Price
3) Place
4) Promotion
The marketing mix of POL are discussed as under:
Product:
A product is anything that can be offered to market for attention, acquisition, use or consumption
that might satisfy gnat or need. Products that are marketed include physical goods (e.g. automobiles,
books), service (e.g. hair cuts, concerts), person (e.g. Mow, Bipasha), places (e. geckoes Bazaar,
Rangamati).

Product : The product of POL

Petroleum products:
MPL markets various types of POL products. These are:
Name User
High Octane Blending components (HOBC) Motor Vehicles
Motor sprit (MS)/ Petrol Motor Vehicles
Superior Kerosene oil (SKO) Domestic Use.

High Speed Diesel (HSD) Motor Vehicles

Light Diesel Oil (LDO) Industry Railway Ship
Jute Batching Oil (JBO) Jute Mill
Furnace Oil (FO) Industry & Brick Field
Liquefied Petroleum Gas (LPG) Domestic Field use
Bitumen Road Carpeting
Lubricants Engine Oil
Battery Water

Price:
Pricing is very important factors.

26
They have different pricing for different product. Such as
1. Pricing of bulk product : Set by the BPC
2. Pricing of lube: Set by the condition of BP.
3. Element of cost considered in pricing : Cost oriented Demand oriented.
4. Demand difference pricing
5. Competition oriented.
6. Going rate pricing
7. Special pricing
 Zone pricing
 The basing- point system
 Uniform FOB pricing
The Principle of pricing are as follows:
1. Bank charge commission
2. Insurance
3. Port duties
4. Survey fees
5. Handling commission
6. Refinery cost
7. Import duty
8. VAT

27
Technical Services
Technical services department plays a vital role to market lubricating oil. Technical service Manager
experienced in technical side. All activities are performed to import lubricating oils from world
famous British petroleum. He also gives suggestion to blend base oil imported by PBC as per MPL
requirements to the two blending company i.e. SAOCL and ELBL according to formula of BP.
Lubricating oils is the most profitable product which gives the highest profit margin. Technical
Services manager also renders post sales service to the customer regarding quality and performance
of the product.

Two types of lubricants marketed by POL. These are:

i) Blended
ii) Non-Blended

1. Blended : POL directly imports BP lubricants in different packed sizes and drum sizes.
MPL imports lube in the following sizes:
Can Size – 5Ltr, 4 Ltr, 3 Ltr, 1 Ltr, Ltr.
Drum size – 210 Ltr, 209 Ltr, 208 Ltr, 205 Ltr and 200 Ltr.
2. Non Blended : In this case base oil is imported by BPC in 3 grades i.e. SN150, SN500,
SBS150 and blended in ELBL or SAOCL using additives according to BP formula and
marketed in the name of BP Brand.

Locally blended lubricating oil has different category like as

Engine Oil
Hydraulic Oil
Turbine Oil
Industrial Oil
Circulating Oil

28
Complains Handling :
One of important function of sales department is to handle complains properly and efficiently.
Complains come from various sources which are as follows.
1. Maximum complains come from direct customers who directly procure from POL.
2. Sometimes retailers also complain about the quality Quantity grades color etc. of POL
product.
Complains should be handled with due care and attention to protect the goodwill of company. For
this reason MPL takes some steps to handle complains which are given below:
* Listing complains with care and attention.
* Classify the nature of complain
* Send officer to investigate the real facts

* If any complains comes from customer regarding product quality, grades, uses etc. then
advices and technical assistance are provided to them.

Functions of Planning & Economics Department

This department performs the following functions:
* Sales forecasting
* Schedule operation program
* Company’s Future demand forecasting and infrastructure development plan to meet demand.
* Long term and sustainable planning.
* Study economical and technical feasibility
* Analyze previous sales tread find out area wise weakness and plan effective strategy.
* Business diversification plans.
Generally sales forecasting is done considering the amount of crude and finished products planned
for sales and the availability of funds for making that amount of sale etc.
Operational program ensures right quantity of POL products in the right place and right time with
the bet mode of transportation. For this operational program, a nationwide
network is designed connecting all dealer’s, agents all over Bangladesh to make available the
products in all required concerns.
Once Meghna decided to start fertilizer business other than marketing POL products but due to some
constraint this business was stopped. At present MPL has an agreement with Rahim Afrooz for
marketing battery water.
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Functions of Engineering Department
Engineering department is very important department of POL as it is responsible for project planning
& implementation, preparing & reviewing the company’s budget estimation before tending etc.
Engr. Department takes measure for total safety & securities at the depots through out the country. It
follows & implements the explosive rules of 1937.

1. Capital Budget : This budget is about 20/25 crore take per year that include project like
storage tanks building, big amount of renovation, procuring office equipment etc. For capital
budget expenses required BUD-2c (cut of budget allocation).
2. Revenue Budget – Expenses for normal day to day items like stationery, salary, maintenance
etc. are revenue kinds of budget. It is about 5 crore taka per year.
SHIPPING, DUTY & CLAIMS SECTION:
Shipping : This section has been closed when Esso Company sold out their company to the
Bangladesh Government.
Duty : MPL has 27 tanks, Two type of tanks:
 Duty paid tank (ERL paid the Duty)
 Bonded tank for imported bulk product.
When MPL received the oil from Ship, they submit the Into Bond Bill of entry to the Custom
Authority within 15 days from the receiving time. POL will submit the Ex Bond bill of entry to the
Custom Authority when product will be dispatched and POL will pay the duty as per rules, BPC
reimburse this duty to the POL.

Duty for own import: POL import lube, additives, grease, transformer oil, meter, hose pipe, pump,
with the approval of BPC. After approval of BPC, MPL open L/C. When supplier send the shipment
document, MPL handover this document to the C&F Agent. C&F Agent completes the whole
formalities within free times. When this time extend, Custom claims demurrage to the MPL. If the
fault is from BP, BP bears the demurrage, otherwise POL bears it.

Claims: 4 types of Claims:-

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 1. Claim lodged with Bangladesh Railway dispatch through tank wagon within 6 months
being dispatch.
2. Lodged with sea Custom Authority against excess payment of Customs dues with 120
days being payment.
3. Lodged with Customs, Excise & VAT Authority against excess payment of VAT within
120 days.
4. Lodged with Insurance Company against short receive of imported packed product. There
is no time limit.
SECURITY SECTION:
Security section plays a vital role in any organization. Indirectly they are the owner of the
organization. MPL has a security section with a Strong Security officer and a large number of elder
securities. But in the security section of MPL no young security.
There are various ways of wastes and theft change of POL products through the pipe line or tank. So
the security system of main installation is highly organized. They maintain of checking every person
who are entering in the area through metal detector.
MPL operates mainly three jetties:
I. Dolphin Oil Jetty (DOJ-5)
II. River Mooring (RM-5)
III. Lighter Jetty (LJ-4)
According to organogram three should be 60 safety where three are only 36 guards among them 16
are from Ansers. They do their duties through 3 shifting hours:
a) 1st shift 8am – 4pm
b) 2nd shift :4pm – 12am
c) 3rd shift; 12am – 8pm
The functions of this section are:
 Bulk products delivery (registered)
 Lube products delivery (reg)
 LPG in & out (reg)
 Bitumen in & out (reg)
 All source of store item
 Material gate pass
 Maintain Local Store House Order (LSHO) Form
 Maintain daily labor slip
 Checking all the men and materials

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  Lubricants import handling (reg+ marine products)
 Import handling.
LPG SECTION:
POL receives LPG from only sources LPG plant Chittagong. LPG plant Chittagong bottles LPG and
MPL markets it. The LPG section is responsible for all kinds of marketing activities of LPG. LPG
section invites and makes agreement with the carrying contractors through tender. These carrying
contractors carrying out the LPG bottles/ cylinders from LPG plant to main Installation in order to
that these contractors Tk. 2.90 per cylinder as carrying charges and also distribute through out the
country. Every cylinder contains 12.5 kg’s of LPG.

WAGON SECTION:
Wagon section is a part of Bulk section. Bulk product like- HSD, FO, JBO, SKO, MS etc. send to
different rail-head depots by wagon. By this wagon a certain amount of necessary oil are send to
Railway. We provide oil in our different depots by railway wagon. Such as:
 Shreemongal Depot-HSD, SKO
 Rangpur Depot-SKO, HSD
 Chandpur Depot- JBO.
 Rangpur Gas Turbine power plant- HSD.
Wagon Filling Shed:
Before load POL product into wagon this is necessary to wash up the wagon purely. So every wagon
should discharge system under it which wagon I load POL products. This is
necessary to have different pipe line from BP Shed for Wagon Shed because for wagon and DP shed
there have parallel line and both move at a time. As a result line pressure become slowly and it will
take time to load. Some times we see that wagon loading keep stop for DP shed after shutting down
the DP shed wagon will give to load. It is very watchful task to load the wagon, because no delivery
flow meter is used to load the wagon.

ORDER & BILLING SECTION:

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Order & Billing section is the payment receiving section. All payment against POL and Lube oil
from customers received here. Amount received through pay-in-slip, payment order / DD etc. There
is no cash received. But no on account sells excepts Defense, Railway, and Port for special
consideration.

Introduction of S&D:
Supply and Distribution Department plays a vital role in case of supply and distribution of POL
products to all of the depots in Bangladesh to supply & distribution properly for every product, there
is an AGM (S &D) who supervises the timing, dispatching, agreement of rent and payment of coastal
tanker, shallow tanker, railway box wagon and tank wagon etc. S&D works as vein of human body
which helps to flow the blood between heart & cell. Without vein the blood cannot flow. Like as
vein without S &D, the POL product cannot be sold everywhere in Bangladesh.

Functions of Supply and Distribution Department :

 To share out POL product from ERL and import on the basis of demand.
 To provide POL product through all the depots from MI.
 To help BPC to prepare import schedule.
 To give coastal tanker program.
 To inform JOCL and POCL about import product.
 To recruit coastal tanker, shallow draft tanker, truck, etc. on contract basis by tender on
basis of company charter.
 To make transit loss and deduct it from freight bill.
 To prepare ERL and import received statement.

4.9 Introduction of Purchase Department:

Any kind of purchase of the MPL everything is done by this department. To maintain the purchase
department there is a manager in this department. Through different types of purchase depend on
different top level employee; every single purchase goes through the purchase department.
Depending on the price purchase can divided in to theree types These are:
1. Direct purchase by user up to Tk. 2000
2. Purchase of goods valuing below Tk. 30000
3. Purchase of goods valuing above Tk. 30000.

Types of purchase:
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  Local Purchase (It is done by local tender)
 Foreign Purchase (It is done by International tender)
Types of Tender:
 Open Tender
 Seal Tender (Only enlisted party can participate & it only done
when the value is with 30,000 Tk)
4.10 COMPANY’S PURCHASING PROCEDURES:
1st Step:
Budget item Summary Sheet (BUD-2C):
This is applicable only for capital items and must.
2nd Step:
Purchase Requisition (PA-07):
o Single Envelope System
o Two Envelope Systems.
The purchase Requisition (LPR: From PA-07) is an advice and authority to the purchasing Section to
make a purchase. No purchase will be made by the Purchase Section unless authorized by a properly
approved purchase requisition on from PA-07.
3rd Step:
Quotation:
 Direct procurement or Committee procurement in a very special case & approved
by MD.
 UP to Tk. 30,000/- Distributed thru enlisted party.
4th Step:
Opening for Tender (Technical):
It has finished thru Tender Committee. It is applicable for Two Envelope System only. At least 3
bidders are required to fulfill tender quorum otherwise it is proposed/noticed for re-tender but for 3rd
time tender it is not applicable to fulfill tender quorum.

5th Step:

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 Evaluation of Tender :
It has finished thru Technical evaluation Committee. It is applicable for Two Envelope System only.
At least 3 bidders are required to fulfill quorum otherwise it is proposed/noticed for re-tender but for
3rd time tender it is not applicable to fulfill tender quorum.

6th Step:
Opening of Tender (Commercial) :
It has finished thru Tender Committee. At least 3 bidders are required to fulfill tender quorum
otherwise it is proposed/noticed for re-tender but for 3rd time tender it is not applicable to fulfill
tender quorum.

7th Step:
Comparative Statement (PA-31) :
 The Tender Committee recommends awarding the job to the lowest bidder/bidders
to the Management.
 Up to Tk. 50,00,000/- must be approved by MD.
 Above Tk. 50,00,000/- Up to Tk. 1,00,00,000/- must be approved by MD & as
well as by MPL Board.
 Above Tk. 1,00,00,000/- must be approved by MD and as well as By MPL Board
& BPC Board.
8th Step:
Purchase Order (PA-09) :
Finally purchase order issued to the approved lowest bidder/bidders.

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Functions of Accounts & Finance:
1. Financing the equipment personal, operational facility etc. of the oil market & office.
2. Preparing & verifying the consolidated financial statement of the centralized and
decentralized cost center unit.
3. Obtaining accounting report from all units in each months.
4. Monitor mgt information using competitor and other system & keep all sorts of
financial analysis & calculation update.
5. Carries out auditing by internal external & international auditors in order to verify
consolidated financial statement report analysis.
6. Verifies the efficiency & effectiveness of inventory control, security wastage,
supervision.

4.11 Section of Accounts & Finance:

1) Cash Section
2) Trade Accounts Receivable Section (TAR)
3) Banking & Insurance Section
4) Order & Billing Section (O&B)
5) Budget & Marketing Section
6) Accounts Payable Section
7) Stock Section
8) Ledger & Taxation Section
9) Payroll section

10) Office Service Section

11) Provident Fund Section
12) Computer Section

CASH SCTION:
This section deals with petty cash. Initially it receives Tk. 100000 as revolving fund to bear small
day-to-day cash payment. Normally this section pays conveyance bill, small amount of medical bill,

36
small amount stationery bill. On the payment of accumulated amount of Tk. 50000 cash section
prepare a PCR to have the Tk. 50000 again.
In addition to this, Cash Section deals with the Main Installation (MI) sales proceed like Pay Order,
Demand Draft (DD), Pay-In-Slip etc. deposit to Bank & Prepare a monthly bank statement of deposit
instruments & give it to computer section.,
Further more when Terminal receive Pay-Order or Demand Draft through SA-02, they send a
summary sheet after making to the Bank and this section done the cross check with Invoice.

TAR SECTION:
The TAR Section prepares individual customer-wise sales data. Basically when Govt. party i.e.
Defense, PWD, Railway and PDB wants to receive product by credit. This section made the actual
figure of sales. This section also looks after the sales of Semi Govt. organization wise, Filling Station
wise, Agency points wise. Dealer wise etc. It is also known as “Customer Account”. Normally each
depot sends sales report-party wise, product wise details to TAR department & this section input the
data to party wise ledger book. This section normally does the following functions and
responsibilities:
 Prepares monthly statement of A/R through SA-01.
 Prepares aging analysis.
 Prepares summary of Control Sheet.
 Maintain each customer account.
 Maintain Customer’s ledger namely GE-09 & RE-23 in
every month for every region.
Data of this section is very much essential for taking decision.

ORDERS AND BILLING SECTION:

O & B section performs the following responsibilities to protect the financial jeopardize in MPL
depending on invoices SA-01 and SA-02, which are sent by different depots to O & B section.
 Record the sales for every depot with location wise, product wise, agent wise.
 Prepare & Issue of Debit note & Credit note.
 Prepare Freight Poll account.

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  O & B prepares the only monthly Journal Voucher. The Journal are-
o JV-01- To issue with Credit Note.
o JV-02- To issue with Debit Note.

o JV-20- Record the sales.

The entire sales & stocks figure of the company confirm by the reconciling the data of TAR section
& O&B section. This section prepares the Debit note for receiving the payment & Credit note for
receiving excess payment.

BUDGET & MARKETING SECTION:

The section is responsible to prepare different type of budget. Basically every department prepare
their round the year requirements & this section compile all the requirements, transforms the
requirements into financial data & thus the transform into MPL budget.
*** Expenses Budget – Revenue Budget.
*** Project/ Establishment Budget = Capital Budget.
This section also prepare the review budget after 6 (six) month of every year.
The main objectives of this department are to:
 Ensure custodianship of all company assets to verifying their physical existence.
 Monitor and assets proper informational needs pertinent to company activities and
thereby facilities according procedures and achieve financial growth.
The main features of the department are:
 Financing the equipment, personnel, operational facilities etc. of the oil market and
office.
 Preparing and verifying consolidated financial statements of all centralized and
decentralized cost centers units.
 Obtaining according reports from all units in each month.
 Monitor management information using competitor and other system and keeps all
sorts of financial analysis and calculation update.
 Carriers our auditing by Internal External and International Auditors in order to verify
consolidated financial statements, reports and analysis.
 Verifies the efficiency and effectives of inventory control, security wastage, working
procedures, supervision, machine maintenance workers safety, advertising tools etc.
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ACCOUNTS PAYABLE SECTION:
Payment sections are made by two sections:
1. Banking Section.
2. A/P Section
The Nature of payments are-Salary, Leave Encashment & every allowance other than direct
payment. Cartage bill, Railway, CPA, BIWTA, BIWTC, Tanker Bill, Defense, Rent for Office,
Medical fee, Gas, Wasa, Electricity bill, Fitness for car, Telephone bill, Newspaper bill, Purchase of
medicine, Employees Traveling expenses, Reimbursement of Petty cash.
It is very important section of the accounts department as all mot all the payment process through
this, section makes the following payments.
 Payment for purchase of ERL,
 Payment for product imported to BPC
 Payment to Tanker Owner.
 Payment to Trolley Owner.
 Control all the payment to depots, offices through out the country.

STOCK SECTION:
Stock section deals with procurement and distribution and storage amount the POL products. This
section calculates stock in hand of all the depots and MI to calculate stock positions (Monthly,
Quarterly, Yearly). It prepares product wise, depot wise region stock position in the basis of DBPSR
(Daly Bulk Product Sales & Received) it considers different types of losses, purchases and opening
stocks. Stock section prepares JV-14 for monthly product purchase with details product summary.
They also prepare the JV-16 for monthly operational loss & gain with the help of depot wise
operational data.
For preparing of product Balance Sheet the main document are:
 IN-17- Summary of stock.
 IN-89- Inventory entry, In & Out
 IN-43- Transshipment order for Refine product.

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  IN-44- Other than Refine product for Transshipment
 IN-72- Product assistant (Inter Company
Transaction received by dealer)
 DBPSR- Refine stock Information.
 Stock Batch- Document listing summary.

 Sales Batch – Sales related document.

 Sales statement-From Depot.

Some Journal Vouchers are:

 JV-16-Operational loss/gain
 JV-13- Rebranding (Only lube)
 JV-14- All purchase
 JV-55- Tanker operations (Transit loss & tanker
freight bill)
 JV-56- Closing stock valuation
 JV-91-Opening stock
 JV-12- Product own use
 Loose JV-Wind fall loss/gain, Conversion loss/gain,
Retransshipment, MMSC.

LEDGERS and TAXATION SECTION:

Ledgers and Taxation section is the last section where all postings are made by this section and
output is Financial Statement. This section makes key statement of the financial activities where we
get the idea of the performance of the company. These key statements are sent to GM and BPC
according to the instructions. This section deals with the Company Taxation matters (for last ¾ years
this matter is deals by company nominated Ta consultancy firm “Huda Vasi & Company”. This
section prepares several types of statement like.
 General Ledger
 Trial Balance
 Profit & Loss Account
 Balance Sheet
 Notes & subsidiary ledger (break down of the general ledger)
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  Income Statements
 Cash flow statements.

PAYROLL SECTION:
Payroll section is running by “Pay Master”. Payroll section deals with salaries, wages, all sorts of
bonus, overtime, utility etc. most the payment make through bank. The functions of payroll section
are as follows:
 Process the salary.
 Maintain bank account of Non-Management and Management Employees.
 Prepare salary sheet for Management and Non-Management Employees.
 Maintain Non-Management attendance record (ER maintains the Management records).
There is software which name is Foxpro. Here 4 file that is as follows:
 MN-Salary main file.
 MN-Loan file
 M-Bank

PROVIDENT FUND SECTION:

Company provide 10% provident fund (on Basic salary) facilities for all the permanent employees.
The account of PF supervise by the section. It controls the investment, loan, final settlement under
the certain rule.

COMPUTER SECTION:
MPL has a computer section under the supervision of Accounts & Finance Department. Only the
entry & store of data is done here. Basically the data of TAR section, Banking section, Marketing
section are process & store here.

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 Chapter-Four
Findings and analysis

42
Findings
No organization exits without weakness and problem. In POL, the following weakness exits:

1. Office environment is not that much homogeneous with the change of time.
2. The grievance handling procedure for employees of POL is not sufficient and strong
enough.
3. Existing training program for POL management and non-management are not applied at
all.
4. Seminar/workshops for field’s level officials for extensive marketing activities and
development are not satisfactory.
5. Main installation of POL with other depots are also not within safety net.
6. The sales promotional activities which are taken by POL are not sufficient and business
oriented.
7. POL cannot meet up product demand in the market in time. As for examples LP Gas and
Bitumen.
8. Product import tanker handling by POL which is governed by BPC hence POL suffers
sometimes to get proper share import handling, which is profitable for the company.
9. Transshipment of POL products from MI to different depots are not in smooth and timely
operative.
10. POL product pricing is determined by the government where profit margin is kept low, as
such POL does not get any benefit from huge turnover.
11. Appointment of middlemen (like Dealer, Agent) is not under proper procedure of POL.
12. The overall product distributor and operating system with other functions are still done
by manual.
13. The activities of Employee Relations department is not well equipped and informative.

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Recommendations:

1. Quality man power is sales department is to be increased.

2. POL should be needed to arrange for field level officials, sale oriented seminar / Workshop
for extensive marketing activities and development.
3. POL should take more promotional activities for the settlement of company.
4. POL needs total computerized and accounting software system immediately.
5. Establish of proper fire fighting materials and supporting training courses for workers to use
it properly.
6. Good carrying contractor with sufficient trucks, agent, and dealer of filling station should be
appointed by POL.
7. Employee Relations department should be more strong and timely compliance based.

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Conclusion

Petroleum is such kind of product, without which sustainable development of a country can not be
possible. Economic condition of every country of the world depends on its price ups and down.
Bangladesh is not out of them. So, this kind of important product deals by POL. The present product
market performance of the company is good in visible scene. The management of the company
always careful about his commitment. The management contents qualified, experienced & skilled
teams who are able to implement any types of decision which are fruitful for the company. I
specially give thank to all executive or departmental head for arranging such kinds of training.

Though POL deals precious & valuable product and the people of the country depends on its. It fail
means total fall in darkness. So, we all should be cautious about all kinds of devil activities.

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References:
 .Different publications of Padma Oil Limited.
 Prospectus and Brochures.
 Previous report.
 Different web publications.

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