NEW DELHI, Dec 19 (Reuters) - India has added Italy's ENI to a list of foreign firms that can sell crude oil atofficial prices to state refiners, sources said, in the firstsuch revision to the list since 2001.
The move comes as India expands its sources for oil to meetsoaring energy demand. The country's procurement choices arewidening as a shale boom in the United States has led tosuppliers scrambling to tap alternative Asian markets such asChina and India.
A government committee in May called for revising the listof companies that can sell oil to state refiners in view of thechanging market scenario and due to mergers and acquisitions.
State refiners together account for about 56 percent ofIndia's overall 4.3 million barrels per day (bpd) refiningcapacity and follow the government policy on oil imports, unlikeprivate refiners such as Reliance Industries, EssarOil, Bharat Oman Refineries Ltd and HPCL-Mittal EnergyLtd.
Economic growth and rising middle-class numbers are drivingthe demand for fuel. To cater to that demand, refineries areexpanding.
Indian Oil Corp, the country's biggest refiner,will commission the 300,000 bpd Paradip refinery in the eastcoast next year and Bharat Petroleum is expanding thecapacity of its Kochi refinery in southern India by 120,000 bpd.
The state refiners buy the bulk of their oil needs fromnational oil companies. However, the rules permit imports fromselect companies if the companies own equity oil or have a swaparrangement with the equity oil holder or have a term deal withthe national oil company of the producer country for sourcingthe desired grade.
"We created this list in 2001 but it was hardly used. Nowcrude market dynamics are changing and more and more suppliersare looking at Asian markets like India and China," said G.P.Aggarwal, former general manager of international trade at IOC.
The revised list retains ExxonMobil, Royal DutchShell, BP, Chevron and Total,industry sources said.
"There was a need to revise the list as some companies haveceased to exist and some have been merged, like Elf Aquitaineand Texaco. From 10 companies the list has been revised to sixnow," said an industry source.
One oil company each from Japan, South Korea and Spain areno longer part of the list, the source said.
"These companies have hardly shown any interest in supplyingoil at the official selling price," the source added.
