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RIL looking at exporting diesel to Pakistan

NEW DELHI: Buoyed by the decision of the Pakistan Government to allow import of fuel from India, Reliance Industries is upbeat at the prospects of exporting diesel from its upcoming refinery at Jamnagar in Gujarat to Pakistan.

In July, Pakistan announced expanding bilateral trade with India by allowing more imports, including diesel and fuel oil.

RIL is likely to commission its 29 million tonnes a year export-oriented refinery by October and Pakistan will be one of the destinations besides the U.S. and Europe of the high value fuel it will produce, sources said.

RIL’s existing 33 million tonnes a year Jamnagar refinery in Gujarat and the upcoming unit adjacent to it offer the cheapest option for Pakistan but the Islamic nation has been getting fuel from countries such as Kuwait at a heavy discount and RIL will have to at least match those offers.

Importing diesel from India will be cheaper for Pakistan due to the difference in transportation cost but Islamabad has traditionally relied on the Gulf nations for its oil needs.

Besides discounts from Gulf nations, the only other roadblock for RIL is the fact that Pakistan has not graduated to using high specimen clean fuels (Euro-III and IV grade), the kind Jamnagar will produce, sources said. While Reliance’s first refinery already produces mainly for export, the second will be devoted entirely to foreign customers.

High-value fuels are exclusively for export to the West, primarily to Europe and the U.S. It will soak up excess heavy Middle East crude supplies and export high-quality gasoline, diesel and jet fuel to markets around the world.

The new plant has a low cost base and high complexity offering it unrivalled global reach for its fuel, allowing it to shift exports to the highest-priced market. It will play a swing supply role that will redraw traditional trade flows, and has already embarked on a robust marketing campaign in Europe, Mexico and East Africa, capitalising on delays and cost overruns faced by other big refinery projects.

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