BUSINESS

IOC plans more oil exports

NEW DELHI OCT. 31. The Indian Oil Corporation plans to double its exports of diesel and jet fuel to one million tonnes by next year. It has already signed a contract for export of 30,000 tonnes of diesel and 10,000 tonnes of jet fuel to Sri Lanka where it will also be taking over 300 retail outlets within the next year.

Disclosing this here today, the IOC Chairman, M. S. Ramachandran, said the value of exports to the neighbouring country would be $1 million in the first year. Sri Lanka consumed 3.4 million tonnes of petroleum products annually but had a refining capacity of only 2.2 million tonnes.

The Indian oil major will also be taking 100 petrol pumps of the Ceylon Petroleum Corporation (CPC) by the end of this year. The IOC chief said KPMG had been appointed as a consultant to evaluate the cost of these retail outlets and the discounted cash flow method would be used in the valuation process. Apart from these retail outlets taken over from the public sector company, IOC plans to acquire another 200 privately owned outlets.

Mr. Ramachandran said his company would begin to export petroleum products including diesel, LPG and bitumen to Bangladesh from the next fiscal. LPG exports were expected to be about 10,000 tonnes from 2003-04. In addition, a contract for bitumen export had been concluded.

He noted that IOC was keen on LPG marketing in Bangladesh for which talks were now under way with the Government. The company was also examining the possibility of exports on a government-to-government basis. This could include the prospect of exporting products and importing natural gas from Bangladesh. He felt some such mechanism needed to be formulated at the Government level.

He said IOC would use the excess capacity at Haldia refinery and at its subsidiary Chennai Petroleum Corporation Ltd. for supplying petroleum products to Sri Lanka and Bangladesh. CPCL is being expanded by 3 million tonnes to 10.5 million tonnes per annum by June 2003.

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