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March 21, 2007 14:37 IST
Reliance Industries Ltd is seeking export-oriented unit status from the government for its existing 33 million tonne per annum refinery in Jamnagar.
The company's decision to apply for the EOU status was prompted by the fact that it does not get any relief on its retail operations while state-run firms such as IOC, BPCL and HPCL get government subsidies on selling fuel below cost, industry sources said.
An EOU status means RIL, the country's most valued firm, would not have to pay duty on crude oil imports. This will help the company reduce losses on selling petrol, diesel and other petroleum products at a lower price, while keeping refining margins high.
Commerce ministry officials said the approval is likely to come in the next couple of weeks.
Such a status would also enable RIL, which is looking for potential acquisition targets abroad including petrochem major Nova Chemicals in north America, to supply cheaper feedstock like naphtha to overseas units, the sources said.
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