Mumbai, July 20: Reliance Petroleum (RPL) will seek direct marketing rights once it is known that IBP will be acquired by another oil PSU. The ministry of petroleum and natural gas has ruled out any open bidding for IBP and reiterated that it will be sold to one of the three navratnas - IndianOil, Bharat Petroleum Corporation and Hindustan Petroleum Corporation.If this were to happen, RPL will press with its legitimate claim for marketing rights as it has fulfiled the criteria of investing Rs 2,000 crore in a refinery as well as producing three million tonne of crude annually.
"We will wait for a clear picture to emerge.The issue of conferring strategic status for the oil sector will have to be clarified as well as the restructuring of the stand-alone refiners," RPL managing director Anil Ambani said.
For the present, 50 per cent of RPL's products are lifted by IOC and the balance equally by HPCL and BPCL. IOC and RPL have decided to enter into a joint venture once the oil sector is completely deregulated in 2002. This will mean that IOC's retail network comprising over 7,000 product outlets will be available to RPL. This could be a more pragmatic option to buying out dealer sites or investing in new ones.
Interestingly, RPL had announced a year ago that it was targeting the retail sites of BPCL, HPCL and IBP which provided a ready marketing base for the products of its 27 million tonne refinery in Jamnagar. Engineers India was also referred to as an appropriate ally to lend synergies in engineering, procurement and construction.
IBP has around 1,500 retail outlets of which 50 per cent are located in the products-starved northern region. This has aroused the interest of HPCL which has planned a nine million tonne refinery in Punjab. Though the petroleum ministry has favoured inter-PSU sale of IBP, sources say that this many not find favour with the finance ministry which will insist on open bidding as is being done with other PSUs.
In this case, global giants like Shell and TotalFinaElf will also throw their hats into the ring. Both companies have made it known that they are keen on entering the profitable area of marketing petro-products at the earliest opportunity and IBP would be the best starting point. Likewise, Mangalore Refinery and Petrochemicals (MRPL), the joint venture of the AV Birla group of companies and HPCL, would logically be in the fray for IBP except that its present financial status is the biggest deterrent.
Copyright © 2000 Indian Express Newspapers (Bombay) Ltd.