The Hindu Business Line : Oil cos assure TN of diesel supply at bunks

Chennai, Aug. 21 Oil marketing companies have assured the Tamil Nadu Government of continuous availability of diesel at the retail outlets, according to the Chief Secretary, Mr L.K. Tripathy.

At a meeting of representatives from the three oil companies (IOC, HPCL and BPCL), industry and the State Government, the oil companies have assured that there would not be a shortage of diesel supply for transportation needs.

The shortage of supplies in the last two days was due to logistics problems following the all-India strike by central trade unions on Wednesday. This has now been sorted out, he said.

‘Unexpected demand’

The oil company representatives have explained that they had not been prepared for the more-than-usual surge in demand in Tamil Nadu because of the industrial growth and demand from industry, particularly the IT industry, to run diesel generators due to a shortfall in power generation by the State utility.

Oil companies routinely prepare for a 15 per cent growth in demand over the previous year. The demand in Tamil Nadu had increased by 30-35 per cent. The oil companies have assured that they would be able to cater to the ‘normal levels’, Mr Tripathy said.

Demand for diesel in Tamil Nadu is around 4.2 lakh kilolitres a month and 75 per cent of this is sold through retail outlets — 3,000 bunks — and about 25 per cent is sold in bulk to the State Transport Corporations, Ports and Railways. Industry users, including IT companies, buy their requirement of fuel for power generation from the bunks and in bulk, he said.

Direct buying

The State Government has urged IT companies to buy their requirement of diesel directly from the oil marketing companies. IT companies have indicated that they are willing to pay more to the oil companies for the additional requirement, the Chief Secretary said.

The situation would be entirely resolved once the monsoon rains start and hydel generation kicks in. For now, the shortfall in power generation is about 700-800 MW at peak demand, Mr Tripathy said.

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