IOC to buy term crude from Nigeria

State-owned Indian Oil Corp. (IOC) says it soon will sign an agreement with Nigeria to buy 6 million tonnes of term crude before March 2001. The decision follows closely a term pact between IOC and Malaysia for the purchase of 1.5 million tonnes of Tapis and Miri crude.


NEW DELHI�State-owned Indian Oil Corp. (IOC) says it soon will sign an agreement with Nigeria to buy 6 million tonnes of term crude before March 2001. The decision follows closely a term pact between IOC and Malaysia for the purchase of 1.5 million tonnes of Tapis and Miri crude.

IOC is the centralized crude importer for all state-owned refining companies in India. Nigeria is a new entrant to IOC�s list of term crude suppliers. The pact with Nigeria is part of its long-term strategy to reduce its overall dependence on the spot market and buy more crude on a term basis.

Earler this year, IOC signed term contracts to buy 30.5 million tonnes of crude in fiscal year 2000-01 (April 2000 to March 2001) from key Persian Gulf crude producers�Saudi Arabia, Iran, Kuwait, and Abu Dhabi. While, for most of these countries, the offtake quantities remained similar to the previous year�s, term volumes from Iran for fiscal 2000-01 have been raised by 3.5 million tonnes to 12.5 million tonnes. The increased term volume is designated for Mangalore Refinery & Petrochemicals Ltd., which operates a 9 million tonne/year refinery in southern India.

IOC expects crude availability from its term suppliers to be more comfortable in 2000-01, with no supply cuts, given that the members of OPEC decided to increase their output by a combined 1.452 million b/d from Apr. 1.

India�s projected crude imports for fiscal 2000-01 are 77 million tonnes vs. 74 million in 1999-2000. The countries refining sector has undergone a major expansion in recent years, with the start-up of three new plants and the tripling of capacity at Mangalore's refinery (OGJ, Jan. 31, 2000, p. 32).

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