Limited domestic availability of oil and gas is compelling local refiners and other users to import more despite the volatile international price scenario.

Domestic public and private sector refiners in August together imported 17.117 million tonnes of crude oil (15.045 million tonnes). In August, the average price at which the Indian refiners bought crude oil was $108.45 a barrel.

Production from domestic fields fell 1.5 per cent year-on-year, according to a data released by the Ministry for Petroleum & Natural Gas. The drop in output was mainly because of the decline in production from Oil India’s fields in Assam due to bandhs and blockades. Oil India’s output fell by 4.3 per cent year-on-year. The country’s refining capacity increased by 68.87 per cent from 2004-05 to 215 million tonne a year as on April 1, 2013. It is further projected to go up to 264.966 million tonne by 2015-16. This means the refiners would have to depend more on crude oil imports to run their plants.

Local refiners turned 4.9 per cent more crude oil into fuel during August against the same month last year. The data also included estimated production of Reliance Industries’ 580,000-bpd export-oriented plant. The company’s two refineries in Jamnagar, Gujarat, account for about 30 per cent of the country's refining capacity.

Gas output from the domestic fields in August fell 16.1 per cent year-on-year, as production from Reliance Industries operated KG D6 block continued to drop. The current gas demand in the country is 190-200 million standard cubic metre a day, roughly about 100-105 mmscmd comes from domestic sources and rest are imported.

richa.mishra@thehindu.co.in

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