IOC, RIL spat on fuel supplies

Outlets say they receive lesser fuel than what is being despatched from the refinery

Even as 1,200-odd retail petroleum outlets in Gujarat are observing a partial strike and threatening to intensify agitation over the quality and quantity of products being supplied by petroleum companies, Indian Oil Corporation Ltd (IOC) and Reliance Industries Ltd (RIL), which runs its refinery at Jamnagar, are now at loggerheads over the issue.

The petroleum outlets contend that they have been receiving lesser amount of petrol and diesel than what is being despatched from the refinery, IOC has taken up the matter with RIL, seeking to know why this is happening.

All PSU oil companies source their petrol and diesel requirements for the state from Reliance's Jamnagar refinery. This is being done under the "product hospitality agreement" that exists between various petroleum retailing companies in the country to save on transportation cost.

According to petroleum dealers, they have been receiving around 200 litre less per tanker of petrol and diesel. The apparent reason being while the tankers are loaded at ambient temperatures its volume is greater. Later it gets condensed due to cooling. And the condensation thus results in a reduction in volume by the time the fuel is taken to the outlets.

"We have taken up the matter with Reliance and have asked them why dealers are complaining about volume deficiency. We first received a communication that there were no problems in loading of fuel into tankers, but we have again taken up the matter with Reliance," R Sareen, general manger, Indian Oil Corporation Ltd, Gujarat, told Business Standard on Thursday.

He added though that as per international norms, the fuel transaction between oil companies is done at a temperature of 15 degrees Celsius and supplies to dealers is always at ambient temperature.

Reliance officials, however, said that there is no question of lesser fuel being delivered as a joint team of Reliance refinery personnel and PSU oil companies are present when tankers are loaded. Meanwhile, Sareen said that the two other demands that the dealers have made are concerning the ministry of petroleum and natural gas and the IOCL has no power to address these.

Sareen said that the dealers' commission issue is decided by the Union ministry for petroleum and natural gas and dealers must understand that this cannot be sorted out at the state level.

"I have told the dealers repeatedly that the commission is not decided by oil companies, but by the Union petroleum ministry," Sareen said.

On the other issue regarding transportation rates, the IOCL general manager said that all petroleum retail dealers had agreed and even signed written contracts with oil companies on the rates which were decided by a public tender.

"The contracts have been signed for a period of three years beginning 2002 and will continue until 2005. Also, the escalation clause has been added into the contract, which allows for the rates to be revised in case fuel prices go up," Sareen said.

Parimal Nathwani, executive, corporate affairs, Reliance Industries, said that in any case Reliance's Jamnagar refinery has not been supplying fuel to dealers across the state but to PSU oil companies.

"A joint team of Reliance refinery personnel and those of PSU oil companies oversee the loading of fuel in the tankers. So there is no question of lesser fuel being delivered. And the weights and measures accuracy at the refinery is of world standards," Nathwani said.

However, Reliance officials added that dealers seems to be more concerned about commission they receive from PSU oil companies than about quantity of fuel.