Reliance seeks government nod to sell LPG as auto fuel
17 Feb 2007
Mumbai: Faced with a surplus of liquefied petroleum gas (LPG) at its Jamnagar refinery, Reliance Industries Ltd has sought government permission to sell the gas as auto fuel.
Reliance, which operates the country's largest refinery in the country at Jamnagar in Gujarat, sells most of the 2.4-million tons per annum of LPG to state-run retailers. It is, however, facing a surplus now after the public sector firms, which have increased their own production, have since reduced purchases from Reliance.
The company is looking at new markets for the surplus LPG after buyers IOC and HPCL re-sold LPG brought from Jamnagar as subsidised cooking fuel to households.
Although Reliance has been seeking permission since November for permission to sell LPG as auto fuel or exporting it, the government is yet to take a decision.
Currently, only state-run refiners Indian Oil Corporation, Bharat Petroleum Corporation and Hindustan Petroleum Corporation are allowed to sell indigenously produced LPG as fuel for automobiles. Private sector companies have to use imported LPG.
Reliance, which already sells 3,000 tons per month of imported auto-LPG in parts of Southern and Western India, is looking at substituting up to 15 per cent of the petrol market with auto-LPG.
The company has a network of 1,260 petrol stations across the country, which can be used for selling auto-LPG.