Mangalore Refinery and Petrochemicals Ltd. (MPRL) (India)

 

 

 

A subsidiary of India’s ONGC, MPRL is a crude oil refinery north of Mangalore, India.

Date: Ongoing

Deal: MPRL continues to be refinery that uses Iranian crude as feedstock. According to ONGC, the Indian Government approved a contract for the Indian Oil Corporation Limited (IOC) to import 5 million metric tons (MMT) of Iranian crude to the refinery from the National Iranian Oil Company (NIOC) in 2003 (The Oil and Natural Gas Corporation, October 22, 2003).

According to The Hindu Business Line, Mangalore Refinery and Petrochemicals Ltd. signed a year-long contract with NIOC to buy five million tons of crude oil in February 2005 (The Hindu Business Line, February 7, 2005).

According to Reuters, Mangalore Refinery and Petrochemicals Ltd. (MRPL) signed a contract to import 132,000 barrels per day (bpd) in early 2009. MRPL planned to increase imports to 142,000 bpd starting in April 2009 (Reuters, March 27, 2009).

According to MPRL, at the end of 3rd quarter 2010-2011, the company has continued to receive its supply of Iranian crude, despite international sanctions (MPRL, 2011).

In light of the international community’s increasing sanctions against Iran, it has been difficult to obtain insurance for shipments carrying Iranian oil. According to Reuters, MRPL obtained coverage for its Iranian oil cargo imports from the Iran Insurance Company (Reuters, June 11, 2012).

According to Reuters, MRPL, in an effort to decrease its crude imports from Iran, began to buy Azeri, Saudi and Emirati crude in July 2012. MRPL planned on importing 3.3 million barrels per day of Iranian crude that month, but only imported a fifth of that (Reuters, July 16, 2012).

According to Reuters, MRPL was able to receive its Iranian crude oil imports in December 2012 as a result of “a loophole in an Indian insurance scheme” (Reuters, January 15, 2013).

MRPL announced in March 2013 that it would halt its Iranian crude imports (Reuters, March 8, 2013). According to Bloomberg, MRPL was purchasing crude oil from other suppliers in the Gulf to offset the loss of Iranian crude oil imports (Bloomberg, March 18, 2013).

In July 2013, MRPL began the process of resuming Iranian crude oil imports after it was able to obtain local reinsurance claims, reported Reuters (Reuters, July 1, 2013).

According to Bloomberg, MRPL officially resumed its Iranian crude oil imports in August (Bloomberg, August 20, 2013).

In an effort to cut Iranian oil imports by 15 percent, India instructed its two largest oil refiners, including MRPL, in October to import only about 80,000 barrels per day over the next fiscal year (Reuters, October 1, 2013).

According to Reuters, there were further disruptions in oil imports from Iran due to uncertainty about insurance coverage which stranded MRPL and other refiners’ tankers outside of ports in Iran and India. The cause of this was that India had yet to extend approval for the provision of tanker insurance and the three month approval given to the Iranian insurance company had expired at the end of September. This contributed to a further hold up in imports which MRPL had been increasing since the Indian insurance company backing was approved (Reuters, October 8, 2013).

In November, Iran offered India’s oil refiners, including MRPL, free delivery of Iranian crude oil in order to bolster sales reported Reuters. Iran has also agreed to offer price reductions if the refiners increase their crude oil purchases (Reuters, November 7, 2013). According to The Wall Street Journal, MRPL accepted Iran’s offer of free delivery of Iranian crude oil  (The Wall Street Journal, November 8, 2013).

According to Reuters, India’s imports of Iranian crude rose 13 percent from October to November (Reuters, December 18, 2013).

According to Bloomberg, MRPL planned to buy 4 million tons of Iranian crude in 2014 (Bloomberg, January 7, 2014).

Last Updated: July 11, 2014