Reliance Petroleum loses Rs. 515 cr. on exports of petrol, diesel

NEW DELHI, JULY 8. Reliance Petroleum (RPL) lost Rs. 515 crores on "forced" exports of 2.725 million tonnes of petrol and diesel during 2000-01 fiscal as "it was denied fair access to the domestic controlled market".

RPL lost Rs. 468 crores on "forced" exports of 1.597 million tonnes of diesel and Rs. 47 crores on export of 1.128 million tonnes of petrol in 2000-01, the company said in a recent presentation to Mr. Ram Naik, Union Petroleum Minister.The denial of fair access to the domestic controlled market was forcing it to export petroleum products at lower price, the presentation said adding only 38 per cent of petrol and 84 per cent of diesel produced by RPL was absorbed domestically as against almost 100 per cent by other public sector refiners.RPL said capacity expansion of national oil refineries by 22 million tonnes, after commissioning of its 27 million tonnes Jamnagar Refinery in Gujarat in July 1999, had resulted in oversupply situation and adversely affected product offtake from its refinery.

The presentation claimed that RPL was being treated as a balancing (swing) refinery with products absorbed only when PSEs do not produce or they are shut down.

"On every occasion the penalty for RPL increases, since RPL is forced to export largely when prices are adverse," the company said demanding equitable domestic absorption of controlled products (petrol, diesel, LPG and kerosene) and a level playing field vis-a-vis public sector refineries.

Accusing the Government of backtracking on its February 26, 1999, pledge to treat RPL on par with its public sector rival, RPL said "all PSE refineries/expansions had been given full domestic absorption even if they were commissioned after RPL." Without naming them, the Reliance representation criticised failure of Indian Oil Corporation (IOC), Bharat Petroleum Corproation (BPCL) and Hindustan Petroleum Corporation (HPCL) in offtaking product from its refinery despite Government assurance that IOC would offtake 50 per cent of Jamnagar production while the rest would be done by BPCL and HPCL.

"Products with negative tariff protection - kerosene for public distribution system (PDS) and domestic LPG (cooking gas) - are selectively absorbed from RPL while products with compensating tariff protection - diesel and petrol - are not fully absorbed. RPL is compelled to export these products at heavy penalties," the presentation said.

During July-September 2000, RPL exported 4.44 lakh tonnes of diesel at a loss of Rs. 29 crores over the domestic price. It lost Rs. 1 crore on export of 3.41 lakh tonnes of petrol during the same period, the presentation said.

In October-December 2000, the company lost Rs. 365 crores on export of 9.28 lakh tonnes of diesel and Rs. 45 crores on export of 3.72 lakh tonnes of petrol, while in the last quarter of 2000- 01 fiscal, the company lost Rs. 75 crores on export of 2.24 lakh tonnes of diesel and Rs. 17 crores on export of 2.95 lakh tonnes of petrol.

- PTI

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