Shipping Corporation of India, which was in 2012 forced to stop transporting crude oil due to unavailability of insurance cover for its ships following tightening of international sanctions against Iran, will resume sailing, initially to ferry crude oil for Hindustan Petroleum Corp Ltd (HPCL).
This follows lifting of sanctions against Iran in January. The largest domestic shipping line will ferry the first cargo of crude oil from Iran something this month. "State-run HPCL has approached SCI for deputation of a vessel for importing crude oil. In-principle, it has agreed to it," Shipping Secretary Rajive Kumar said. However, the exact date has to be fixed for transporting the oil cargo, Kumar said.
Other state refiners Mangalore Refinery and Petrochemicals Ltd (MRPL) and Bharat Petroleum Corp Ltd (BPCL) too have contracted SCI for shipping oil from Iran. After SCI and other ship owners stopped ferrying Iranian oil, the Persian Gulf nation offered free delivery of oil to customers in India in its own vessels.
This was aimed at keeping its key customers during the tough sanctions period. But with the lifting of sanctions, Iran has stopped free shipping and has since April started charing concessional rates.
Essar Oil, which along with MRPL are the biggest buyers of Iranian oil, has already started making its own arrangements for shipping oil from Iran. The premier shipping line which owns and operates around one-third of the Indian tonnage, and services both national and international trades, has stopped sailing to Iran in 2012 as insurance cover for oil and cargo could not be obtained in the wake of sanctions targeting Iran's nuclear programme.
After lifting of sanctions in January, International Group of Protection and Indemnity (P&I) Clubs which insure the tanker market have been able to obtain cover from some markets, an official said. The largest domestic shipliner has a fleet of 69 vessels of which 17 are bulk carriers, 16 crude oil tankers and 14 product tankers and is planning expansion of its fleet.
A Parliamentary panel has recently recommended that SCI buy fuel-efficient ships, replacing the old stock. "If the international market situations are viable, they may go for purchasing new fuel-efficient vessels in place of the old ones," Parliamentary Standing Committee on Transport, headed by Kanwar Deep Singh, has said.
Shipping Corporation of India was established in 1961, by the amalgamation of Eastern Shipping Corporation and Western Shipping Corporation. It owns and operates around one-third of the Indian tonnage, and has operating interests in practically all areas of the shipping business and servicing.
Apart from being the largest shipping company in India, SCI exclusively operates in break-bulk services, international container services, liquid/dry bulk services, offshore services, passenger services.