Mangalore Refineries hikes production despite falling demand
ONGC, new owner of the loss-making Mangalore Refineries, would do well to ponder why the refinery has hiked production despite a general fall in demand for petroleum products.
Data for April 2002 to June 2002 shows that MRPL was operating at 75% of its installed capacity of 10.5m t/y in April, while in June production stood at 82% of capacity. To explain this, choose one or both of two theories: one is that MRPL is producing more to export and raise cash to pay for crude oil imports; another is that management hiked production to "cook the books." The first theory is more plausible as cash payments from the export market are much quicker than from the domestic market.
One export cargo of 55,000 tonnes of diesel with 0.5% sulphur will begin loading this month. Also this month, expect a tender to export 35,000 tonnes of jet fuel.