Reliance imports LPG for state firms

India's Reliance Industries Ltd is importing LPG to deliver promised supplies to state oil firms, indicating some secondary units at its new refinery may not be fully operational until April, trade and industry sources said. "It seems their FCCU (fluidised catalytic cracking unit) and an alkylation unit will not run at full capacity till April. They have told us there will be a shortfall in LPG supplies till March," said an official with Indian Oil Corp.
A trade source said the same units would be used to produce high quality gasoline, and LPG imports up to March suggested gasoline exports would not be possible until the following month. A spokesman for Reliance did not respond to emails seeking comment. Reliance Petroleum, a subsidiary of Reliance Industries, commissioned its new 580,000 bpd refinery in December, adjacent to the parent company's 660,000 bpd plant, making it the world's biggest refining complex.
Reliance initially said it would supply 2.693 million tonnes of LPG to state refiners but it later raised the volumes to 2.965 million tonnes, including supplies from the new refinery, said the IOC official, who did not want to be identified.
He said Reliance had committed to supplies of 320,000 tonnes in January but it sold only 270,000 tonnes. "We withdrew from our inventories to make up for the shortfall," he said. Reliance has informed state firms there would be a shortfall of 55,000 tonnes in February and about 80,000 tonnes in March, the official said.
"They have supplied us one imported cargo of about 40,000 tonnes in February," he said. Two trade sources confirmed that Reliance had agreed to buy three very large gas carriers from Naftomar and one form Glencore. One cargo each from Naftomar and Glencore is for delivery in March.
Reliance's refineries are export-focused, enabling the firm to get tax benefits, but the federal government bars LPG exports to ensure smooth supply of cooking gas to households. The refiner plans to put in place an 85,000 bpd alkylation unit. For a factbox of Reliance's new plants refinery configuration and output.
Reliance's new plant is the first in the country to have an alkylation unit that will process butane to produce alkylates with a high octane number. That should enable the firm to produce superior quality gasoline to tap US and European markets.