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Pratim Ranjan Bose

`Possibility of exploring opportunities with MMTC unlikely now'

Kolkata April 14 BPCL seems to be going slow with its plan to promote an international trading arm. Though the company is tight-lipped on the issue, sources said that the proposal had not received much favour from the Union Government, till date.

Though denying that the plan had been dropped, a senior company official admitted that the proposal has not seen much progress so far. "The proposal is still in the conceptual stage and the possibility of setting up a joint venture is farfetched at this juncture," the official said.

BPCL has entered into a MoU with MMTC — a public sector trading company — in March 2006 to jointly explore opportunities in international trading in products such as crude oil, LNG, bitumen, furnace oil, paraffin wax and base oil.

Apart from selling BPCL products and buying crude for its refineries, the collaboration was aimed at trading third party products. Both the companies have also expressed intention to explore setting up a joint venture — preferably in Singapore — in the future.

MMTC has an annual turnover of over Rs 15,000 crore and has a subsidiary in Singapore. The company also operates in various free-trade zones across the globe.

Apparently, the proposal is a win-win for both the companies while BPCL would have gained from MMTC's expertise in international trading as well as trading logistics such as chartering of ships and others.

Similarly, BPCL has taken a serious interest in international trade of crude oil and petro products since 2004, which could have been useful to MMTC. The company has already set up a risk management desk and is actively collaborating with domestic commodity forward markets for promotion of trading in petro-products.

The company currently exports goods worth Rs 500 crore.

More Stories on : Outlook | Petroleum | Bharat Petroleum Corporation Ltd

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