India's Reliance stops local petcoke sales, boosts imports
(Reuters) - Reliance Industries has stopped selling petroleum coke within India and boosted imports of the product to turn it into synthetic gas to power its refineries, according to two sources familiar with the matter and trade data.
Petroleum coke is a carbon intensive solid residue left over from coking units in oil refineries that break down residual oil into more highly valued products. Petcoke, as it is known, can be used as a coal substitute in both steelmaking and in power plants.
Reliance had been depending on liquefied natural gas (LNG) to run its refinery complex and selling the petcoke locally but it is now gasifying its petcoke amid rising LNG prices.
With Reliance's petcoke no longer available domestically, India's imports are likely to rise, after doubling last year because of higher demand from cement makers, who use the petcoke to manufacture the building material. Reliance was the country's biggest domestic supplier until 2021.
"They slowly started reducing supplies (to local markets) in the middle of last year, but now it has come to a complete stop," one of the sources, a petcoke trader, said.
Reliance did not immediately respond to a request seeking comment. Both sources declined to be named as they are not authorized to speak to the media.
I-Energy Natural Resources, a solid fuels trader in India's Gujarat state, said prices of petcoke delivered to India rose last week as cement manufacturers increased their imports since it is still cheaper than overseas coal.
"There is a very limited supply of domestic petcoke to end-users, and this has made players to procure from the international market," I-Energy said in a note on Monday.
Trade data reviewed by Reuters shows Reliance also imported over 192,000 tonnes of petcoke in the four months to January amid higher internal demand. That compared with about 110,000 tonnes in the eighteen months ending September.
"They have previously bought petcoke from overseas at a discount for internal consumption, and exported the petcoke they produced for a premium," said the second source, a former Indian buyer of Reliance's petcoke.
"But now, they are using everything they produce and also importing," the source said.'
(Reporting by Sudarshan Varadhan; Editing by Florence Tan and Christian Schmollinger)
Comments