Reliance Industries and Essar Oil are keen on buying crude oil from Cairn India's Rajasthan fields even as the petroleum ministry struggles to find takers of the nation's most prolific oil discovery among public sector firms.
The Rs 31,000-crore refinery and petrochemical plant being planned by Oil and Natural Gas Corporation in Kakinada in Andhra Pradesh is likely to have a new partner -- the Bangalore-based GMR group. GMR is the latest to join the long line of suitors, including the Hinduja group, Reliance Industries and Essar Oil, for the refinery.
Reliance has shut all of its 1,432 petrol pumps in the country after sales dropped to almost nil as it could not match the subsidised price offered by public sector competition. Public sector currently sells petrol at a loss of Rs 13.97 a litre and diesel at a discount of Rs 20.97 per litre. This revenue loss is made up by the Government through issue of oil bonds. Private firms were not entitled for the subsidy and priced fuel from their pumps at Rs 8-10 a litre higher.
Essar has announced a $6bn expansion plan to more than triple capacity at its refinery, while Reliance, at its site a few kilometres away, is working on plans to almost double capacity.
Govt's move will facilitate entry of global giants such as Total SA of France, Saudi Arabia's Aramco, BP Plc of the UK, and Trafigura's downstream arm Puma Energy.
A depreciation in the value of the rupee against the dollar, coupled with surging crude oil prices, are likely to push the country's crude oil import bill to over $100 billion in 2008-09, from $77.02 billion in 2007-08, according to industry officials.
The domestic supply of diesel has been constrained on rapidly growing demand. The diversion of supplies from Reliance Industries, which was given export-oriented unit status last year, has added to the shortage. Reliance produces 10 million tonnes of diesel from Jamnagar.
Reliance plans to shut two-third of its 1,400 petrol pumps in the country by next month as it is unable to match the fuel price offered by state-run retailers, who get compensated by the government for selling fuel below the cost. Reliance and Essar make huge losses on selling petrol and diesel at prices higher than Indian Oil, Bharat Petroleum and Hindustan Petroleum. On an average, fuel at private outlets is costlier by Rs 4 to 5 a litre than the PSU pumps.
Cairn India is 25th on the list with 22.2 per cent CGR.
Essar Oil Ltd, India's second largest fuel retailer, has reopened about 350 petrol pumps it was forced to shut down due to heavy losses on matching petrol and diesel prices with hugely-subsidised public sector rates.
The Vadinar refinery in Gujarat currently operates at a capacity of 7.5 million tonnes and it is expected to reach its full capacity of 10.5 million tonnes by October.
The company is in the process of doubling its production to 800 oil barrels a day from the current 400 barrels a day, from a part of the field called prospect-B.
Essar Oil's 10.5-million-tonne-per-annum refinery at Vadinar in Gujarat went onstream on Friday, with its first product, LPG, expected to roll out by Saturday.
Petronet India Ltd is likely to formally shelve the Rs 2,450 crore (Rs 24.5 billion) central India petroleum product pipeline project this month as its promoters are no longer keen on the project.\n\n\n\n
In a major boost to oil majors aspiring to tap the retail oil sales market worth $15 billion a year, the government on Monday allowed marketing licence holders to import petrol and diesel.
Five out of the top 10 companies in Fortune 500 list of Indian companies are from the oil sector.
In November they had raised $2.19 billion from abroad, according to the Reserve Bank data released on Friday.
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The dealers are protesting against the use of petrol pumps for government campaigns and seeking of personal data of over a million people working there
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Petrol and diesel are among the 90-plus commodities that have been approved by the government for derivatives trading
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Prime Minister Modi appreciated the vision of Putin for the welfare for Russia's Far East, saying the Russian President has opened up investment opportunities for India in the region.
One of the major advantages of buying Iran crude is the additional credit period of 90 days that the country gives to India, compared to 30 days by other countries.
IOC, the key importer of petrol, has sought almost 700,000 tonnes for March-September delivery.
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