IOC and Saudi Aramco to tie up for merchant storage oil terminal
Mumbai: With crude oil prices reaching record highs of more than $55 a barrel, Indian Oil Corporation and Saudi Aramco, the world's largest oil company, have dropped the idea of building strategic crude storage facility for India and may instead build a merchant storage terminal to sell crude oil to other oil companies.

Saudi Aramco, which produces more than eight million barrels of crude a day, had announced in January this year, that it would team up with IOC to help set up a strategic crude oil storage terminal, but with climbing crude prices the two companies may put up a merchant crude storage terminal at an Indian port instead, as the option is commercially more viable, IOC officials said.

The two companies have not yet decided the cost or size of the commercial venture. According to IOC officials, Saudi Aramco has in principle agreed to put up a commercial terminal, and IOC in turn has sent them a proposal detailing its ideas and are now awaiting their response.

The idea of a merchant crude storage terminal is relatively new with only one other similar storage along the Korean coastline.

According to the IOC proposal, it will provide land and port for setting up the terminal while Saudi Aramco, which controls more than one-fourth the world's proved oil reserves, will bring in inventories.

The companies will set up a joint venture in which Saudi Aramco will participate in managing the terminal.

Indian Oil had earlier announced plans to float a special purpose vehicle for setting up underground oil storage facilities. The capital cost for the storage was envisaged at Rs1,650 crore, for storing a 15-day crude inventory worth roughly Rs5,000 crore.

Currently, the total crude oil storage capacity can meet the country's oil requirement for 19 days.
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Price hike: Oil companies to lose Rs.2,300 crore by April end
Mumbai: Oil marketing companies stand to lose Rs810 crore in the first fortnight of April if the Government fails to permit an increase in petrol and diesel retail prices, senior Indian Oil Corporation official have indicated.

Government-owned oil companies will also bear additional losses of more than Rs600 crore on account of duty adjustments on cooking gas and kerosene prices, announced in the Budget. Thus, cumulative losses may go up to Rs2,300 crore by April-end if the Government does not allow a hike on April 15, officials said.

Indian Oil, which controls more than 50 per cent of the country's oil retail market, will lose Rs300 crore on petrol and diesel under recoveries and Rs352 crore on cooking gas and kerosene sales, till April 15, said the official.

The Government has refused to allow any increase in retail prices of cooking and transport fuels in spite of rising crude oil prices. International crude oil prices have been at $55 a barrel levels this month compared with around $ 40 a barrel same time last year.

According to a senior official, companies have seen the subsidy related loss on cooking gas sales rise by Rs10 to Rs80 a cylinder. On every litre of kerosene sold, companies claim they are losing Rs10.20 a litre, compared to Rs7.20 a litre before the Budget.

Petrol and diesel prices have not been revised since November 2004.
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DEPB benefits for SEZ units restored
New Delhi: The Revenue Department has withdrawn its circular of February 2004 banning the benefits of Duty Entitlement Passbook (DEPB) credit for supply of goods to special economic zones (SEZs) as physical exports and clarified that the supply of goods to SEZs during the period April 1, 2003 to May 11, 2004, should also be entitled for DEPB benefits.

It may be recalled that the Exim Policy in 2003-04 had stated that the supply of goods to SEZs should be treated as physical exports and would accordingly be entitled for DEPB benefits. This was also endorsed by the Revenue Department. But subsequently, the department issued a circular in February 2004 stating that supplies are not entitled for DEPB benefits.

The council took up the issue with the department, which recently resolved the same by withdrawing its mid-course circular issued in February 2004 by clarifying that supplies affected during 2003-04 should also be eligible for DEPB benefits.
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Roadshows in US to showcase India's export potential
New Delhi: The Confederation of Indian Industry (CII), in partnership with the Ministry of Commerce and Industry's Department of Industrial Policy and Promotion (DIPP), and India Brand Equity Foundation, will organise a series of road shows in the US from April 8-18, titled `India Connect-USA', in order to boost Indo-US trade relations.

These road shows would showcase some of the sectors with the greatest potential for export growth and in which India enjoys a global competitive advantage. The road show will kick off from Seattle on April 8, and would conclude in New York on April 18, said a CII release.

The CII delegation would be led by the President, Sunil Kant Munjal, and the government delegation would include the Finance Minister, P. Chidambaram; the Minister of Science and Technology and Ocean Development, Kapil Sibal; and the Secretary (Economic Affairs), Ministry of Finance, Dr Rakesh Mohan.

The Minister of State for Commerce & Industry, E.V.K.S. Elangovan, and the Secretary (Commerce), S.N. Menon, would also be a part of the delegation. Conceptualised as a brand-building exercise, `India Connect-USA' would travel across the US, covering five major economic centres: Seattle, San Fransisco, Chicago, New York City and Washington, D.C.

Besides Munjal, the CII delegation includes N. Srinivasan, Director General, CII; Scott Bayman, President and CEO, GE India; Arun Maira, Chairman, Boston Consulting Group; Sam Pitroda, Chairman, C-Sam Inc; Dr J.J. Irani, Director, Tata Sons Ltd; Sandeep Kishore, Vice-President, HCL Technologies; Vipul Prakash, Regional Manager (South Asia), IFC; Bobby Bedi, Film Producer; and M.V. Subbiah, Executive Chairman, EID Parry (India) Ltd.
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