Aug 10 2012
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India MRPL may load 2 mln barrels of Iran crude in Aug
* MRPL may get 2-3 cargoes of Iran oil in Aug
* MRPL booked Indian vessel with Mercator -shipping source
* Vessel has local insurance cover, source says
NEW DELHI, Aug 10 (Reuters) - India's Mangalore Refinery and Petrochemicals Ltd. may lift about 2 million barrels of crude from Iran in August, it said, and a shipping source said the company has booked its first vessel with local insurance cover to transport the oil.
MRPL imported one cargo of around 660,000 barrels from Iran in July. The August figure is still just a little over half of the 3.7 million barrels India's top buyer of Iranian oil used to import on average every month in the fiscal year that ended on March 31.
India, the second-biggest customer for Iranian crude after China, is keeping oil from the OPEC member flowing in by asking Iran to take on all the risk. It is also asking Indian state-run insurers to provide cover to locally owned ships.
Neither approach has been entirely successful yet because the cover for local ships is limited at just $100 million, while Iran does not have enough tankers that can use Indian ports, reducing MRPL's ability to continue with steady shipments.
"This month, I will be getting two to three cargoes," MRPL Managing Director P. P. Upadhya told Reuters on Friday.
Japan, the only other main consumer which has agreed to provide federal insurance on ships carrying Iranian oil, is providing cover of up to $7.6 billion.
Upadhya said MRPL's imports from Iran could rise once its single point mooring (SPM) is commissioned later this month or early September, enabling it to import oil in bigger vessels.
MRPL, which bought around a third of India's total 362,000 barrels per day (bpd) from Iran last fiscal year, had already cut import plans for this year by 20 percent to 100,000 bpd to help New Delhi secure a waiver from U.S. sanctions on Iran's nuclear programme.
The sanctions are aimed at cutting Iran's oil revenues and forcing it to curb a nuclear programme the West believes will be used to develop weapons, which Iran denies.
MRPL has already received 93,000 tonnes, or about 680,000 barrels, for August in an Iranian vessel Gardenia, Upadhya said.
In July, MRPL received only a fifth of an initially planned 3.3 million barrels of oil from Iran, importing the crude in the Iranian suezmax tanker Magnolia as domestic shippers were not willing to make the journey with reduced insurance cover.
Only Mercator Ltd offered its Omvati Prem aframax in a shipping ministry tender seeking vessels to import Iranian oil for MRPL. The ship was built in 1994, according to the company's website. It is scheduled to lift a cargo on Aug. 15, the first to do so using the limited Indian cover.
"I may ask Mercator to lift one more cargo for us this month," Upadhya said.
"Omvati Prem is the only vessel that Mercator can provide as it is open and is availing insurance from United India Insurance for Iran voyage," said a shipping source with knowledge of the deal who added that MRPL had booked the vessel.
State-run United India Insurance Co is providing $50 million each per voyage against pollution and personal injury claims, also known as protection and indemnity (P&I) insurance, and for hull and machinery to protect ships against physical damage.
The cover is re-insured by General Insurance Co.
(Editing by Manash Goswami and Anthony Barker)
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Keywords: INDIA IRAN/
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