ONGC, MRPL in crude deal

Oil and Natural Gas Corporation (ONGC) has entered into a one-year contract (March 2003- March 2004) with its subsidiary Mangalore Refinery & Petrochemicals Ltd (MRPL) for supply of Mumbai High crude to the latter's 9.69 million tonne per annum refinery at Mangalore.

The memorandum of understanding to this effect was signed on September 30 by senior officers of the companies.

ONGC will charge import parity price for its two million tonne sweet crude (with low sulphur content) to be supplied from Mumbai High fields.

The price of ONGC's Mumbai High sweet crude has been benchmarked to Nigerian sweet crude Bonny Light. Crude to other coastal refineries such as CPCL in Chennai, KRL in Kochi and HPCL in Vizag, are also priced on a similar formula.

ONGC has already shipped its first cargo of sweet crude from Mumbai High in March 2003 soon after MRPL became its group company.

The crude basket of MRPL will now comprise of 30 per cent sweet crude (2 million tonne Mumbai High and one million tonne Nile Blend) and 70 per cent sour crude (2 million tonne Arab Mix and 5 million tonne Iran Mix).

Prior to its take-over by ONGC, this state-of-the-art refinery was processing only 10 per cent of sweet crude.

It is also the first Indian refinery to process equity crude when it processed crude from Sudan from the Great Nile project.

This three-fold increase in the proportion of sweet crude processing, courtesy the equity crude of the parent company ONGC, has resulted in a better yield pattern, taking advantage of the technological edge built in the refinery, according to a press release.