Indian Oil planning to enhance fuel trade with Bangladesh, Myanmar

NEW DELHI: Indian Oil Corp, the nation's largest refiner and fossil fuel retailer, in in talks with Bangladesh and Myanmar to enhance trade of petroleum products and offer its expertise to set up oil infrastructure in the two countries.

This month, Indian Oil will open offices in Bangladesh and Myanmar, with a plan to closely pursue business opportunities in the two countries. "For the neighbouring countries, we are not only looking for business, we are looking for association beyond business. Because these countries are also facing similar problems which we have encountered in past, we will be happy to share our experience with them and help them in solving whatever problems they are facing," Indian Oil Corp Chairman Sanjiv Singh told ET.

The first thing that may materialise in a month or so is a deal for liquefied petroleum gas (LPG), or cooking gas, under which Bangladesh would export LPG to Indian north-eastern states. "We are working on concepts that their trucks can come to India and give us LPG. Rather than we trying to feed those parts of North-East, all along from Haldia, it makes tremendous sense (to depend on Bangladesh trucks for supply)," Singh said. Bangladesh imports all LPG it needs, and the plan is to augment import for supply to North-Eastern states.

Indian Oil also plans to offer petrol, diesel and other petroleum products it produces at its coastal Paradip refinery to Bangladesh and Myanmar. Recently it sold spot cargoes of diesel and jet fuel to Myanmar and is hoping to strike long-term deals with the two countries for product supplies.

"Nobody can supply product cheaper to Bangladesh than Paradip," Singh said.

Indian Oil's liquefied natural gas (LNG) import terminal, which is under construction on the eastern coast near Chennai, could also become a source of supplies for the neighbouring countries that can't take large ships today. "This terminal can also provide us opportunity to bring in big ships and probably feed the neighbouring market, the coastal markets with smaller ships," Singh said.

Indian Oil also plans to participate in their effort at building refineries, import terminals or retail chains. "Setting up a refinery is a smaller job, the bigger job is to operate and maintain those refineries. These are not capabilities which you buy or create overnight. So, we are absolutely open," Singh said.

Indian Oil will again participate if Myanmar were to re-float tender for opening fuel retail stations in the country, Singh said.

The state firm already does fuel retailing in Sri Lanka and Mauritius, has an office in Dubai dealing in lubricants and other product, and has recently opened a crude and gas trading office in Singapore.

With these efforts, Indian Oil will be able to substantially scale up its overseas operations in the next five years, Singh said.