Assam-based Numaligarh Refinery Ltd (NRL), which has a massive expansion plan of its refinery on the cards, is eyeing the Bangladesh market to sell products in near future.

A senior company spokesperson confirmed Business Standard that NRL was exploring the neighbouring country’s market and business discussions with Bangladesh Petroleum Corporation (BPC) and the government of Bangladesh for supplying diesel were on. “Both BPC and government of Bangladesh have expressed keen interest in the project and desired that this project be pursued expeditiously,” the spokesperson added. NRL and Bharat Petroleum Corporation Ltd (BPCL), NRL’s parent company, had “detailed discussion” with BPC and Bangladesh government representatives in the month of January 2013 to “progress on this proposal”.

The government will pay Rs 25,000 crore additional cash subsidy to state-owned fuel retailers to make up for part of the revenue they lost on selling auto and cooking fuel below cost this fiscal.

The Finance Ministry on February 7 issued a "comfort letter" to Indian Oil Corp (IOC), Bharat Petroleum Corp (BPCL) and Hindustan Petroleum Corp (HPCL) sanctioning Rs 25,000 crore for part of the revenue they lost on selling diesel,

New Delhi: Fearing oil refineries will be hit hard by the Finance Ministry's move to change the way petrol and diesel are priced, Oil Minister M Veerappa Moily has asked Prime Minister Manmohan Singh to constitute an expert committee to decide on the issue.

The Finance Ministry has informed the Petroleum Ministry that auto fuel needs to be priced at export parity rather than import parity as the 2.5 per cent customs duty was adding to the under-recoveries of the state-run oil marketing companies without contributing any revenue to the exchequer.

With an eye on bigger imports, the oil marketing firm may get its French partner Total to set it up

State-run oil marketing firm Hindustan Petroleum Corp Ltd (HPCL) is planning to invest Rs 600-700 crore to set up its second underground liquefied petroleum gas (LPG) storage facility in Mangalore. The company could rope in its partner, Total SA of France, to build the cavern. "Given the demand for LPG, we think importing in large quantity would make more sense than importing in smaller capacity. We are discussing the feasibility of this project and would decide on the same in the next six months," said a senior HPCL official, requesting anonymity.

The government’s decision to cap the number of subsidised LPG (liquefied natural gas) cylinders seems to have brought cheer to oil companies as their auto gas segment has registered significant growth since last September.

IndianOil Corp Ltd, for instance, saw a growth of around 22 per cent in volumes and nearly two per cent in its market share. It traded nearly 10,517 million tonnes (mt) of auto gas in December against 8,593 mt of auto gas in September.

Their first target could be bulk buyers but state-owned companies are well-entrenched in that market

At 65 million tonnes per annum, diesel accounts for nearly 40 per cent of all petroleum products sold in the country. Not surprisingly, it is a huge opportunity for private oil marketing companies. Now that the government has decided to decontrol diesel prices for bulk users and allowed government-controlled oil marketing companies to raise retail prices in small monthly doses, private oil companies such as Reliance Industries, Essar Oil and Shell India have a real opportunity on their hands.

Looking at ways to stop bulk diesel users from securing fuel from retail outlets

With dual pricing for diesel in place, oil marketing companies (OMCs) are looking at ways to stop bulk diesel users from securing the fuel from retail outlets. The three public sector OMCs — Indian Oil Corporation, Bharat Petroleum Corporation and Hindustan Petroleum Corporation Limited — want the government to put in place regulations for this.

Govt has permitted oil companies to increase diesel price by 45 paise a month

Bulk consumers will have to pay market price, to be revised every fortnight; Consumers would get nine subsidised cooking gas cylinders a year, instead of six at present. Unwilling to announce a hike in diesel price, the government on Thursday allowed oil marketing companies to increase the price in small doses periodically and bring it in line with global rates. To begin with, an immediate increase of 45 paise a litre was announced for sales through retail outlets, while bulk consumers, which add Rs 12,907 crore to the subsidy burden, would have to pay market price, to be revised every fortnight.

Faced with a hefty bill of close to R1 lakh crore this fiscal towards compensating oil marketing companies on selling diesel below cost and naysaying by the finance ministry, the petroleum ministry is set to ask the bulk consumers of the fuel to buy it at market rates.

Currently, bulk consumers — power plants based on diesel, companies with captive power units, the railways and road transport corporations — buy the fuel at subsidised rates but at slightly lower rates than the retail consumer, thanks to a waiver of dealers’ commission and discounts offered by the oil companies which compete to get the tenders.

To align with global prices and curb energy subsidies

Prime Minister Manmohan Singh on Monday reiterated his position of “phased rationalisation of energy prices to bring them in line with global prices” for “meeting the target of rapid, inclusive and sustainable development” and curbing energy subsidies. Speaking at the foundation laying ceremony of integrated refinery expansion project of Bharat Petroleum Corporation Ltd. (BPCL) here, Dr. Singh recalled his speech at the National Development Council meeting in New Delhi in which he hinted about the pricing of energy.