3 Min Read
SINGAPORE/NEW DELHI (Reuters) - India's largest refiner Indian Oil Corp is setting up an office in Singapore that will handle crude oil purchases and the sales of oil products from its refineries later this year, trade sources said on Friday.
The state-run company is part of a growing group of refiners in Asia that have set up offices in Singapore's oil hub to keep closer tabs on the market and react more quickly to changes.
IOCL Singapore - as the Singapore unit will be named - will initially have two staff to handle some of the crude purchases for its refineries, said the sources, who declined to be named because they are not authorized to speak to the media.
IOC, which accounts for over a third of India's 4.6 million barrels per day (bpd) of refining capacity, did not respond to Reuters' request for comment.
IOC's head of finance, A.K. Sharma, previously said the company planned to open a Singapore office that would eventually handle the trading of crude oil and refined fuels.
IOC has increased the volume of crude oil it buys in the spot market as its new refinery in Panipat has begun running at full capacity this year, the sources said.
Once the Singapore office is up and running, it will help to handle these purchases, they said. At a later stage, the office is also expected to handle the sales of IOC products such as naphtha, diesel and gasoline.
IOC will likely export excess reformate or alkylate cargoes from its Paradip refinery, the sources said. The products are typically used as blendstock in gasoline.
It may also export jet fuel when the country phases out the use of kerosene in two years, they said.
It was not immediately clear whether the products from the Paradip refinery would be sold through the Singapore office.
IOC has said it plans to spend 500 billion rupees ($7.73 billion) by 2022 to raise its refining capacity by about 30 percent to 2.08 million bpd.
This includes an expansion at its Panipat refinery in northern India to about 400,000 to 500,000 bpd.
($1 = 64.6852 Indian rupees)
Reporting by Florence Tan and Jessica Jaganathan in SINGAPORE, and Nidhi Verma in NEW DELHI; Editing by Tom Hogue