ONGC Signed Agreement with HPCL for Sale of Crude Oil

SEATTLE (Oil Monster): The state-owned Oil and Natural Gas Corporation (ONGC) announced that it has signed a term agreement with Hindustan Petroleum Corporation Limited (HPCL) towards sale of crude oil produced from its Mumbai offshore fields. According to sources, the agreement is for sale of about 4.5 million tonnes per annum of crude oil to HPCL’s Mumbai refinery.

This is the second pact that ONGC has entered into recently. Last month, it had signed a similar agreement with Bharat Petroleum Corporation Limited (BPCL) for sale of 4 million tonnes per annum of crude oil.

ALSO READ:

Rise in Refinery Outages, Tighter Supplies Pushing Up US Fuel Prices

Oil Companies Cautions About Drilling as Energy Transition Looms

In June last year, the Indian government had scrapped a rule which requires oil from blocks awarded prior to 1999 to be sold to government-appointed parties. This has been preventing state-run producers such as ONGC from getting best prices.

The rule change has allowed ONGC to come up with quarterly auctions of crude oil produced from Mumbai offshore fields. In the first auction held last year, ONGC had offered 33 lots of 412,500 barrels each, whose sales commenced in November last year. All the cargoes were sold to state refiners with the exception of one cargo, which was sold to private refiner, Reliance Industries Ltd.