Private oil refiner, Essar Oil Ltd has agreed to supply substantial quantities of petrol and diesel to the state-owned Hindustan Petroleum Corp (HPCL) and Bharat Petroleum Corp (BPCL) to feed their network of petrol pumps across the country. Essar Oil is producing 12.5 million tonnes of petroleum products annually at its Vadinar refinery in Gujarat.
“Agreements have been entered into between Essar Oil and HPCL to supply up to three million tonnes of petrol, diesel and kerosene annually,” said S Thangapandian, marketing head of Essar Oil. “Similarly, 1.5 million tonnes of products will be supplied to BPCL every year.”
HPCL currently has 8,033 petrol pumps but does not have a oil refinery in the northern region.
In the absence of a product source in the north, HPCL has to import 1.5 million tonnes of petrol and diesel every year besides sourcing another two million tonnes of products annually from the Mangalore refinery of ONGC to feed the requirements of its consumers in the northern region.
“With the commissioning of our Rs 1,757 crore Mundra-Delhi pipeline, HPCL has decided to source large quantities of petrol, diesel and kerosene (anywhere between 2.5 to 3 million tonnes annually) from Essar Oil’s Vadinar refinery in Gujarat. Our agreement with Essar is up to 2011, till we commission our Bhatinda refinery in Punjab,” said S Roy Choudhary, marketing director of HPCL.