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India's Mangalore Refinery and Petrochemicals Ltd (MRPL) has said that it will delay plans to expand its 190,000 barrels-per-day(bpd) refinery by a year to October 2011.

The project, which was originally scheduled to be completed by August-September 2010, has reportedly been delayed due to setbacks in government clearances and land allotment. Cost considerations were also said to have been a factor.

"All clearances were delayed by about a year, so the project also got delayed," MRPL Managing Director UK Basu told reporters.

The company plans to build a new refinery unit adjacent to the existing facility, which is expected to increase total capacity to 300,000 barrels-per-day. The estimated project cost of Rs 8,000 crore is likely to be revised upwards, local sources report.

MRPL is a subsidiary of Oil and Natural Gas Corporation Ltd (ONGC). Its refinery in Mangalore also produces fuel oil for the Asian bunker market, which the company offers as cargoes to prospective buyers.

Last month MRPL reportedly sold 80,000 tonnes of 380-centistoke (cst) for loading from New Mangalore between October 4th and 6th, according to market sources.

The company also issued a 80,000-tonne cargo of 380-cst fuel oil for loading on November 1st-3rd. A further tender for 50,000 tonnes of gas oil of either 0.5 or 0.7 percent sulphur was scheduled for lifting between October 10th and 12th. In August, MRPL completed the sale of an 80,000-tonne cargo of 380-cst at a premium of approximately $1 to $1.50 a tonne to Singapore spot quotes. This was the first time the Indian refiner had obtained a premium, rather than a discount, on the sale of a spot fuel oil cargo. Oil trading company B.B. Energy was reported to have been awarded the 380-cst cargo.

In July, when MRPL sold the same-sized cargo to Switzerland-based Glencore International AG, one of the world's largest suppliers of commodities and raw materials, the Indian firm was reported to have sold the fuel oil parcel at a discount of $16 to Singapore spot quotes.