Reliance Industries Ltd (RIL) is planning to directly market petroleum products in the US and Europe from its existing Jamnagar refinery and also from its new facility in the neighbouring SEZ, a senior company source said on Thursday. ?All options are open, including setting up retail outlets or selling it to third parties,? the official said.
Currently, RIL exports 80% of the production of its existing 660,000-barrel-per-day (33-million-tonne) refinery to traders, who in turn resell the fuel to different markets in the US, Europe, the Middle East and Latin America. About 4-5 million tonne of petrol and a small quantity of aviation turbine fuel finds it way to the US, the official said.
The company?s new export-oriented 580,000-barrel-per-day (29-million-tonne) refinery, in which Chevron Corp of the US has a 5% stake, is to be commissioned by the end of 2008. Reliance Petroleum, a subsidiary of RIL, is setting up the refinery adjacent to the existing unit.
?Discussions are continuing with Chevron as to how much fuel they will market,? the official said. Initially, Chevron, which has an option to raise its stake in the new refinery to 29%, wanted to market the fuel in the US and Europe, but RIL insisted that it wants to sell fuel in these markets on its own.
?We may appoint a sales agent but nothing has been finalised as yet,? he said.
RIL feels the deficit in world oil refining capacity would continue until 2011-12 and would result in a widening of the difference between the price of crude and finished petroleum products. The wider the gap, the larger the margin that refiners earn. ?This is good for all refineries around the world,? the official added.