Tap overseas markets to sell Indian oil products

Vol 4, PW 26 (14 Feb 01) Midstream & Downstream

Read on for some numbers released to us this month by a senior official in the Ministry of Petroleum & Natural Gas.

We dont have a source document because the official insisted in dictating them. We learn that in the next financial year 2001-2002, India's crude oil imports will rise by 4% to 75m tonnes, over 72m tonnes this fiscal.

Indian Oil will be allowed to import 45m tonnes, Reliance 27m tonnes and Mangalore refineries 3m tonnes. Also in 2002, we learn that petroleum product consumption in India will grow by 2-3% to 108m tonnes over last years figure of 105m tonnes, due to increased demand from agriculture and industry.

In 2001-2002, the oil ministry predicts that domestic crude production will remain stagnant at 33m tonnes. ONGCs exploration budget next year will be Rs2,000cr ($440m) the same as last year.

Next year, oil ministry officials predict that refineries will operate at 95% total capacity of 112m tonnes - slightly higher than the current year average of 92-93%. India would continue to generate surplus in gas oil, fuel oil and naphtha, while product imports would be limited to less than 1m tonnes of LPG, unchanged from this year.

According to the ministry, consumers are switching to cheaper imports and domestic refiners will have to increasingly tap overseas markets to sell surplus gas oil, fuel oil and naphtha.