* HMEL so far has bought 4 mln barrels Iranian oil
* Trying settle Iran payment through Halkbank -sources
* May buy Iran oil in January-March -source
By Nidhi Verma
NEW DELHI, Nov 12 India's HPCL-Mittal Energy Ltd
(HMEL), part-owned by steel tycoon Lakshmi Mittal, plans to stop
importing oil from Iran, a company spokesman said, in a move
that could hurt Iran and help New Delhi secure a waiver renewal
from U.S. sanctions.
Reuters earlier reported that HMEL had emerged as a new
client for Tehran and had bought 2 million barrels oil between
the start of September and mid-October.
HMEL has since bought another 2 million barrels of oil, for
its 180,000 barrels per day (bpd) Bathinda refinery in northern
Punjab state, which was delivered at end-October by Iranian very
large crude carrier Majestic, formerly known as Glory, sources
privy to the development said.
"While it is a stated policy of the company not to discuss
its crude procurement plan, the recent crude purchased from Iran
by HMEL was based on operational requirements during
stabilisation of the refinery. HMEL does not plan to buy any
more crude from Iran," an HMEL spokesman said in an emailed
response to questions from Reuters.
In June Washington granted India a 180-day waiver from
sanctions, which would have cut it off from the U.S. financial
system, because it had reduced its purchases of the OPEC
India's waiver from the sanctions will be renewed in
December if imports have been cut further.
HMEL's decision to discontinue buying Iranian oil will be a
blow to Tehran, whose exports have already declined sharply
under the pressure of sanctions. India is Tehran's
second-biggest crude customer.
The United States wants its allies to cut oil imports from
Iran to pressure Tehran over its nuclear development programme.
The West says it is aimed at building atomic weapons, while Iran
says it is for peaceful uses.
In the six months to end-September, India's oil imports from
Iran declined 19 percent from a year ago to about 257,000 bpd,
well below the targeted 310,000 bpd.
State-run refiner Hindustan Petroleum Corp and
Mittal each own 49 percent in the joint venture HMEL.
Mittal heads ArcelorMittal, the world's largest
steelmaker, which produces 35 percent of its steel in the
Americas and 47 percent in Europe, according to its website.
HMEL began buying Iranian oil without having a banking
mechanism in place to settle Iran payment. The company is now
trying to open an account with Turkey's Halkbank to
pay for Iranian oil, two industry sources said.
Indian customers of Iranian oil currently settle 45 percent
of their trade in euros through Halkbank and pay the remainder
in rupees through an Indian bank.
"They are also exploring a payment route through Russia,"
one of the two sources said.
A second source said HMEL may resume imports in the
January-March quarter after India gets its waiver renewed.