MRPL & IOC pay another $330 mn as oil dues to Iran

The Dollar Business Bureau

In order to clear previous oil dues to Iran, Mangalore Refinery and Petrochemicals Limited (MRPL) and Indian Oil Corporation Limited (IOC) have paid $330 million as second tranche payment through German bank Europaisch-Iranische Handelsbank AG (EIH).

MRPL and IOC, last month made a payment of $750 million to Iran and have now paid over $330 million this month through the German bank.

According to sources, MRPL, which has to pay Iran $2.6 billion before the month of May, has made a payment of $300 million this month and $500 million last month.

IOC paid another $30 million above its $250 million payment made in May. The company had $560 million dues before the payment cycle began.

Essar Oil, having dues of around $3 billion, paid $100 million last month and is going to make a payment of $250 million in the second tranche.

Hindustan Petroleum Corporation Ltd (HPCL), which owed $23 million, had made a payment of $17.5 million. The company’s joint venture with Mittal Energy, HPCL-Mittal Energy Limited, has dues of another $60 million.

Last month, the payments were directed through Union Bank of India, which then transferred the money to National Iranian Oil Co., (NIOC) via Turkey’s Halkbank, the sources said.

This month, the oil companies are making payments in euros through State Bank of India, which then transfer the money to NIOC via EIH.

Sources said that the balance oil dues of $5.4 billion to Iran will be cleared within the next 2-3 months. However, the Indian refiners have been directed to purchase foreign currency in a calibrated way so that it will not hit the rupee.  In May and June, the payments were made in foreign currency by Indian oil companies as sanctions were lifted against Iran in January 2016. The Reserve Bank of India (RBI) is coordinating the process of repayments, they said.