IOC-Reliance deal today

The government is likely to announce on Thursday a new marketing deal to sell about 13 million tonnes of Reliance Petroleum’s products ...

The government is likely to announce on Thursday a new marketing deal to sell about 13 million tonnes of Reliance Petroleum’s products by three oil psus, including IndianOil, for a two year period, beginning April 1.

Petroleum ministry is understood to have assured the officials of Reliance and IOC to clarify some of the issues relating to central sales tax and subsidies in the context of free pricing mechanism before dismantling of the administered pricing mechanism (APM) from April 1, government sources said.

Some of the issues relating to post-APM including regulator for the downstream refining and marketing sector, came up for discussion during the meeting of the chairman and managing directors and directors of oil psus, convened by Petroleum Minister Ram Naik here on Wednesday. Those attending the meeting included IOC chairman M.A. Pathan, ONGC cmd Subir Raha, GAIL cmd Prashanto Banerjee, HPCL cmd H.L. Zutshi and BPCL cmd S. Sunderajan.

Story continues below this ad

Post-apm issues such as pricing of petrol and diesel and developing a mechanism of adjustment of product prices based on import parity levels periodically and options available for insulating the domestic markets from volatalities of international crude market were discussed at the meeting.

When contacted, Naik told PTI that ‘all announcements relating to the deregulated market mechanism will be made at a press conference tomorrow’.

Under the new marketing deal being formalised, IOC would sell about seven million tonnes of rpl’s Jamnagar refinery product while another six million tonnes would be marketed by BPCL and HPCL on ‘best-endeavour’ basis, sources added. (PTI)