IndianOil to buy 1.6 million cubic metres of natural gas a day from Reliance Industries Ltd

IOC to buy gas from RIL to save cost

STATE-OWNED IndianOil (IOC) will buy 1.6 million cubic metres of
natural gas a day from Reliance Industries Ltd (RIL) to replace
costlier liquid fuel at its refineries.

IOC currently uses crude oil or fuel oil for production of hydrogen at
its refineries, and natural gas from RILs eastern offshore KG-D6 field
will replace the costlier fuel, a senior company official said.

"We have tied up with GAIL India for transportation of the gas and are
now waiting to initial the gas sale and purchase agreement (GSPA) with
RIL," he said.

Last year, an Empowered Group of Ministers (EgoM) had allocated 5.384
mmscmd of gas from KG-D6 to public and private sector refineries,
against their demand for 22.8 mmscmd of gas.

IOC had demanded 6.58 mmscmd of gas for Its Gujarat, Mathura and
Panipat refineries, but since refinery as a sector was allocated less
than one-fourth of its demand, the firm is being proportionately given
1.6 mmscmd, he said.
Mail Today, New Delhi, May 13, 2010