Essar Oil also demands a place at the table

Vol 5, PW 20 (21 Nov 01) Midstream & Downstream

It's not only Reliance petitioning the oil ministry for inclusion in the post-APM free market.

Arch rival Essar Oil wants a piece of the action, too. Never mind that the Essar refinery is yet to see the light of day and probably never will! A source tells us that Essar Group vice chairman Ravi Ruia dashed off a three page letter to oil minister Ram Naik last month.

What does Ruia want First of all, that Indian Oil should not discriminate against Essar in favour of Reliance, when lifting products from the Essar refinery as and when it becomes operational. Secondly, Essar wants help from Bharat Petroleum, Hindustan Petroleum, Indian Oil and IBP to pick up products from the (proposed) Essar refinery until Essar has its own marketing infrastructure.

Ruiaconfidently tells Naik that the Essar refinery will be commissioned in mid 2003 and also complains that despite repeated requests Essar has not been allowed to start setting up retail outlets, even though the group's Rs6, 100cr ($1.3bn) investments in the refinery render it eligible. For these proposed retail outlets Ruia wants products from the existing PSU refineries, particularly petrol and diesel, both of which, he points out, are surplus in the country and are likely to remain so for a few years.