To elaborate, no discounts on HSD sales will be given to any consumer. Theproduct will be supplied from the nearest oil company depots within states.Hospitality arrangements will be given to other marketing companies ifrequired, to meet demand. However, supplies on inter-state basis by rail tothe consumer will continue.

No discounts/incentives/facilitation charges of any sort will be given bythe PSUs to either a transporter or any person to promote HSD sales. Allsupplies to processors and consumers (other than the railways, statetransport corporations, defence, power houses, fertilisers, steel plants,central/state government undertakings and consumer pumps) will be ondelivered basis from the nearest depots within the state. Actualtransportation cost incurred by the oil companies will be charged to thesebuyers.

For supplying HSD to existing reprocessors, each oil PSU will establish itsown team to inspect the units and the report will be finalised while takinginto account: a) the existence of the factories; b) whether they are inproduction on a regular basis as per the capacity taken into considerationby the technical evaluation committee (TEC); c) whether the supplieseffected are as per the normal established requirements or in excess; and d)whether the plant makes products for which purpose the feedstock of HSD wassought. If the TEC finds that the unit is not producing the end products asrequired, supplies will be suspended.

HSD supplies to fishery cooperatives (registered with the state government)will also be verified by the industry working group for allocation exceeding250 kilolitres. Supplies will cease if the guidelines have not been compliedwith. The panel will also assess the needs of the fisheries and fix theallocations.

As already indicated, there will be no credit on diesel supplies after July1. Notice will be given to all existing customers of this decision and thiswill be signed by the industry group.

As regards naphtha, its allocation to existing processors should be verifiedagain in detail by the TEC panel.

The areas covered will involve the same as indicated in the case of HSDalong with other parameters which include: a) whether all statutory licencesare in possession of the processors; b) verification of the utilisationdocuments which were to be submitted by the processors to the oil PSUs aswell as of the records. If any customer is found to have defaulted,necessary action will be taken to stop supplies.

Significantly, naphtha supplies to the processors, not to be given oninter-state basis, will be met from the nearest stock point of the oilcompany within the state. If there is no such point, an industry workinggroup will be set up to approve supplies by road on inter-state basis. Thisexercise will be done by June 30.

Supplies after June 1 will be only on a cash-and-carry basis. No credit,discount, facilitation charges and incentive of any nature will be given tonaphtha consumers (including processors) with immediate effect. After July1, any form of credit to major and contractual consumers will be on aninterest bearing basis.

The oil companies have made it clear that in the case of bitumen, nodiscounts, credits, over-riding commission, incentives and service chargeswill be offered to any individual or parties. Manpower appointed for salespromotion, a category that includes middlemen, distributors, productpromoters and a secondary sales force, will be done away with immediately.

Sales of furnace oil (FO) will be effected directly to consumers and notthrough any intermediaries. No credits/discounts or facilitation of any kindwill be offered by the oil PSUs. Sale of FO/low sulphur heavy stock (LSHS)will be on a declared selling price. There will be no inter-state roadsupplies of FO to direct customers and credit will be extended only to majorand contractual customers till June 30.

Fixed price for free products
The industry pricing group will fix prices of deregulated productsimmediately to meet competition from imports/traders. The pricing will befixed to meet freight, state surcharge and other irrecoverable levies andduties. No oil company will sell the free product below the industry-fixedprice as it will amount to giving a discount. It has also been agreed thatas per individual demand, hospitality/product assistance will be extendedwithin the oil companies for HSD, naphtha, light diesel oil, bitumen andLSHS to avoid inter-state movement.