A Colombian energy company plans to sell 12 million barrels of oil to Indian oil giant Essar as part of a USD 1.2 billion deal, it emerged this week.
Colombia's Ecopetrol ECO.CN, Colombia’s largest oil producer, sent the first shipment of 2m barrels of oil in a Very Large Crude Carrier.
The carrier, due to arrive in any day now at an Essar refinery in western India, left Colombia's Covenas port, the main oil harbour on 29 July.
Essar has significantly boosted processing of heavy and ultra heavy crudes at its Vadinar refinery in the western Gujarat state to improve refining margins, the company's managing director said on Tuesday.
Essar aims to buy 15-20 per cent of its crude oil needs from the domestic market, 35-40 per cent from Latin American sources, and 30-40 per cent from the Middle East, it said in May.
In 2010, the company began replacing Latin American crudes with locally produced Mangala oil but has now turned back to the region to feed its expanding capacity. In April-June, it shipped in oil from Venezuela, Mexico, Colombia, and Brazil.
Essar in March completed a USD 18bn expansion of its Gujarat-based refinery which should boost crude capacity to 80 per cent and increase the company’s turnover by a third. Almost half of the fuel will be exported, the company said.