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Mauritius turns to Saudi fuel cargoes after court bans Indian supplies

Reuters  |  PORT LOUIS/NEW DELHI 

By Jean Paul Arouff and Aditi Shah

PORT LOUIS/(Reuters) - The island-nation of has started buying from Saudi Arabia's state-owned company Saudi Aramco after a ordered a ban on Indian supplies because of a dispute between the country and a shipping firm.

For years, Indian refiner Mangalore Refinery and Petrochemicals Ltd (MRPL) has been the sole supplier to of fuels such as gasoline and diesel. However, an Indian has ordered a ship loaded with from MRPL for the island to stay in port until the Mauritian government settles an outstanding $120 million payment to shipper Betamax over a contract dispute.

Mauritian Trade Minister Ashit Gungah told reporters on Thursday in the country's capital of Port St. Louis that Aramco will supply

"I can reassure the population and economic operators that we have sufficient stock of fuel," he said. "A first tanker is expected in the country during the weekend and two more tankers will arrive next week. A fourth tanker is due by mid-December,"

He said the supplies would be sufficient to meet demand until January 2018.

"Other friendly countries have also accepted to help Mauritius," Gungah said.

The issues stem from a dispute between the State Trading Corporation of (STCM), which buys from MRPL, and Mauritian-based shipper Betamax.

STCM in 2009 signed a 15-year contract with Betamax to transport fuels from MRPL in the southern the Indian state of Karnataka to Port Louis. The contract was worth 8 billion rupees ($238 million), according to local media reports.

But in 2015 it terminated the contract with Betamax. The company won a case in June against STCM for premature termination at the Singapore International Arbitration Centre that awarded Betamax more than $120 million.

Betamax pressed the case at the Karnataka High after STCM did not make payment.

A Karnataka order reviewed by directed port authorities at Mangalore "to refrain from providing any clearance" to the tanker Pacific Diamond from leaving with 40,000 tonnes of unspecified petroleum product for delivery to STCM.

The ship is to be held until the next hearing on the matter on Monday, the order said.

Betamax can enforce the arbitration award against STCM's assets in any country where the award is enforceable.

MRPL exports about 1.2 million tonnes of refined fuels to a year.

MRPL will look at exporting the surplus if the ban continues on supplies to Port Louis, a company official said on condition of anonymity.

An MRPL spokesman declined to comment on the matter while Saudi Aramco did not immediately reply to an e-mail.

($1 = 64.5700 Indian rupees)

($1 = 33.5500 rupees)

(Additonal Reporting by Nidhi Verma in NEW DELHI; Writing by Nidhi Verma; Editing by Christian Schmollinger)

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Fri, December 08 2017. 15:34 IST
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