State-owned Bharat Petroleum (BPCL) is contemplating to enter right into a time period settlement with Russia for imports of crude oil. While talks are at a preliminary stage, a supply stated, ‘BPCL officials are already on the job’.
“The plan to enter into the term agreement with Russia is purely a commercial decision, based on the cost advantage that Russian crude can offer now. The company has taken the call and the government has no role in it. BPCL is open to procure crude from any part of the world that will reduce its procurement cost,” stated the supply.
However, the supply added the worth low cost by Russia is just not as excessive as $30 per barrel, quoted in some reviews.
“Transportation cost is very high. The cost of crude procurement is quite high. The suppliers there have got their own cut.”
Sanction imposed by the West on Russia for its Ukraine invasion has pushed Russian crude spot costs down. Indian refiners, which didn’t use a lot Russian crude, grabbed the chance, propelling Russia to turn out to be the second largest provider of crude in May, piping Saudi Arabia.
“The discussion is at the preliminary stage. We are in the process of testing the crude, testing the limitations, etc,” the supply stated.
He stated a remaining choice on getting into into time period contract with Russia will rely upon a number of components such because the capability of the refineries to deal with such crude. “There are many permutations and combinations.”
BPCL has, previously, imported crude from Russia procuring it from the spot market, however in a really restricted means. “Given a choice, we will want to get some term in the long-run.”
BPCL operates three refineries – one every in Kerala, Maharashtra and Madhya Pradesh – with a cumulative 35.3 MMTPA capability. The firm is within the technique of finalising detailed undertaking (report) for growth of Bina refinery’s capability in Madhya Pradesh to 12 MMTPA with an estimated value of as much as Rs 40,000 crore.
Source: www.financialexpress.com”