Indian Oil Corp offers rare volume of 40,000 tons naphtha from Dahej

22-Feb-12

State-owned Indian Oil Corp. has offered a rare volume of 38,000-40,000 tons naphtha for loading from Dahej on India's West Coast via a spot sell tender, as per Platts. Typically, IOC offers 35,000 tons of naphtha for loading from Dahej, with a plus/minus 5% buyers' option on volume. This excess quantity of naphtha can be attributed to IOC's 13.7 mln tpa (275,150 bpd) Koyali refinery. Naphtha produced from the Koyali refinery is usually channeled to IOC's Panipat petrochemical complex, however, it is estimated that IOC could be exporting excess naphtha in a bid to capitalize on current firm Asian naphtha prices. This cargo volume is too big to fit on a standard Medium Range vessel, but too small for a Long Range vessel. Thus the odd-sized naphtha cargo sparked a flurry of interest among Asian naphtha participants, with talk largely centering around which vessel would be best able to accommodate the cargo. It could lead to an LR doing a co-load and picking up another cargo from somewhere else. Naphtha traders and shipping sources said that while the draft at Dahej allows for Medium Range and Long Range vessels to berth there, the "berth is restricted by length." Dahej has a maximum LOA of 215 meters, but that most LR sized vessels have an LOA of over 220 meters, making it impossible for those vessels to berth at Dahej. Some shipping sources indicate that there were a few "big MRs" or "smaller LR1 vessels" in the market that would be able to accommodate such an odd-sized cargo. Only those who can manage to take these sorts of vessels can maybe get the cargo at a good price, otherwise there's no vessel suitable for this volume.