BPCL, ONGC in long-term crude purchase pact
Two Indian government-owned companies, Bharat Petroleum Corp. Ltd. and Oil & Natural Gas Corp. plan to sign a long-term crude procurement agreement to meet some of the former�s requirements after the full deregulation of the oil sector in 2002.
MUMBAI�Two Indian government-owned companies, Bharat Petroleum Corp. Ltd. (BPCL) and Oil & Natural Gas Corp. (ONGC) plan to sign a long-term crude procurement agreement to meet some of the former�s requirements after the full deregulation of the oil sector in 2002.
�In the next few weeks, we will sign an agreement to procure crude from ONGC for the next 15-20 years,� a senior BPCL official said.
BPCL currently markets more than 19 million tonnes of petroleum products every year. The company currently buys 75% of its crude requirement from ONGC, while the rest is met through imports. However, no long-term crude purchase agreement is in place.
The official said, �We have always bought crude from ONGC as and when required but the two companies do not have a written agreement for long-term procurement.�
The company is also gearing up to purchase crude from the international market independently. Currently, the refining company receives imported crude through Indian Oil Corp., the only canalizing agency permitted to buy crude for the public sector oil companies.
Post-2002, oil companies will be free to buy their crude oil requirements from the international market.
�We already have the mechanism needed for international crude purchase in place,� said BPCL�s chairman and managing director U. Sundararajan.