Monday, July 30, 2007

BPCL to seek big bottoms

Gulf of kutchh, housing Vadinar and Sikka, will not be the only heaven for big fish on the western shores of India anymore.

An SPM off Cochin, capable of handling VLCCs of 300,000MT DWT is waiting for a green signal from the real weather gods to come to life. The project would be commissioned anytime after the monsoons, as 95 per cent of the work has already been completed. The SPM is 19.4 km off the Puthuvypeen lighthouse, at a depth of 30 metres in the Arabian Sea.

As BPCL - Kochi Refinery Ltd. expands its capacity from 7.5 MTPA to 9.5 MTPA and gets into the volume game, it was high time that BPCL needed bigger bottoms to cut down on logistic pressures per Metric Ton carriage of raw. By a rough estimate, the company would save around usd 40 million once they have economy of scale to their favour. Right now the company is depending on dead freighting afras to import crude from PG, Asia Pacific and West Africa. The company expects to import more crude from West Africa and other far flungged areas after the SPM is in place as they could then be competitive on FOB bids.

There is another SBM (IOC) in making at Paradip(ECI). For thriving aframax trade on Indian coast, these buoys are harbinger of doom.

Meanwhile, The Cochin Port Trust has already started counting its chickens and the authority is busy drafting a formula to make a clean cut on BPCL gain.

Wednesday, July 25, 2007

IOC's Paradip Haldia pipline delayed

VLCCs discharging on A/C IOC at East Coast of India are to enjoy demurrage trade for some time to come.

Heavy sea and swell have put a hold on IOC's Paradip-Haldia crude pipeline project till September this year. The project was originally scheduled for completion by March, 2006 has now been delayed by 20 months.

Frustrated company management sacked the original contractor in hope to get the work done (in time??) soonest thru Australian contractor but so was not to be. Early onset of monsoons this year has left IOC management biting their nails as their move to change contractor has not yielded desired results and they continue to pay hefty demurrage claims and TC hire to several Afras employed for STS operations.

Ribbon cutting ceremony as per the new deadline of November, 2007 still remains a knotted question, as IOC is already working on timechartering Afras for extended period bss following:

PS. Mercator Tanker Sadanand has been fixed at USD21k pdpd for above.