RIL to offset loss by doubling exports
RIL will more than double exports of diesel, treble gasoline sales this year to offset domestic losses.
By Agencies |
MUMBAI: Reliance Industries Ltd, owner of the world's third-biggest oil refinery, will more than double exports of diesel and treble gasoline sales overseas this year to offset losses from the domestic market.
Shipments of diesel may rise to as much as 10 million metric tons for the year that began April 1, Atul Laul, head of trading, said in an interview. Gasoline exports may rise to as much as 3.5 million tons.
Chairman Mukesh Ambani's 660,000 barrels-a-day plant is cutting domestic sales of fuels to curb losses caused by India's cap on fuel prices. State-run companies that are forced to comply with the price restrictions are compensated by the government, a facility not granted to Reliance.
"It will essentially be diesel and gasoline that will drive our export," Laul said in Mumbai on June 8. ``We have secured the government's permission to classify our refinery as an export oriented where most of the output will have to be exported.''
The company is selling as much as 1.8 million tons of fuels overseas every month, Laul said. Export of jet fuel and naphtha will be about 3.5 million tons each this year, similar to the volumes sold a year ago, he said.
The company's eight-year-old refinery produces motor fuels that meet emission regulations of countries such as the UK and the US
Market Share
Losses on retailing oil products prompted Reliance to slow sales at the stations, cutting its market share to 2 per cent in September from 13 per cent in April 2006, the company said on April 26. Its market share was at 6.3 per cent in March.
The refiner last year sold about 430,600 tons of gasoline and 2.07 million tons of diesel through its retail stations, according to data from the petroleum ministry.
Indian Oil, the nation's biggest refiner, is losing Rs 6.10 rupees for every litre of gasoline it sells and Rs 3.75 on a litre of diesel, S V Narasimhan, director of finance, said on May 21.
Of the total losses, a third is reimbursed by the government as bonds, an equal amount is paid by companies including Oil & Natural Gas, and the refiners bear the remainder. Non state-run retailers such as Reliance aren't compensated for any loss because the government doesn't order them to sell fuels at below-market rates.
Reliance's exports rose 63 percent to 17.7 million tons in the year ended March 31 from 10.8 million tons a year ago. That accounted for 57 percent of the company's production.
Shipments of diesel may rise to as much as 10 million metric tons for the year that began April 1, Atul Laul, head of trading, said in an interview. Gasoline exports may rise to as much as 3.5 million tons.
Chairman Mukesh Ambani's 660,000 barrels-a-day plant is cutting domestic sales of fuels to curb losses caused by India's cap on fuel prices. State-run companies that are forced to comply with the price restrictions are compensated by the government, a facility not granted to Reliance.
"It will essentially be diesel and gasoline that will drive our export," Laul said in Mumbai on June 8. ``We have secured the government's permission to classify our refinery as an export oriented where most of the output will have to be exported.''
The company is selling as much as 1.8 million tons of fuels overseas every month, Laul said. Export of jet fuel and naphtha will be about 3.5 million tons each this year, similar to the volumes sold a year ago, he said.
The company's eight-year-old refinery produces motor fuels that meet emission regulations of countries such as the UK and the US
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Market Share
Losses on retailing oil products prompted Reliance to slow sales at the stations, cutting its market share to 2 per cent in September from 13 per cent in April 2006, the company said on April 26. Its market share was at 6.3 per cent in March.
The refiner last year sold about 430,600 tons of gasoline and 2.07 million tons of diesel through its retail stations, according to data from the petroleum ministry.
Indian Oil, the nation's biggest refiner, is losing Rs 6.10 rupees for every litre of gasoline it sells and Rs 3.75 on a litre of diesel, S V Narasimhan, director of finance, said on May 21.
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Of the total losses, a third is reimbursed by the government as bonds, an equal amount is paid by companies including Oil & Natural Gas, and the refiners bear the remainder. Non state-run retailers such as Reliance aren't compensated for any loss because the government doesn't order them to sell fuels at below-market rates.
Reliance's exports rose 63 percent to 17.7 million tons in the year ended March 31 from 10.8 million tons a year ago. That accounted for 57 percent of the company's production.
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