NEW DELHI (Reuters) - Mangalore Refineries and Petrochemicals Ltd is in talks with Iran to renew its diesel supply agreement, which is valid up to end-December, two company sources familiar with the talks said on Monday.

“Discussions are going on for renewal but nothing has been finalized as yet,” one source said.
In April, MRPL sold a 30,000 tons diesel cargo to Iran, its first ever sale to the Islamic nation.
In May it sealed a deal to export 240,000 tons up to December and in August almost doubled the deal size.
Another source confirmed that MRPL was in talks with National Iranian Oil Company for a longer deal and said: “Form next year, after meeting the domestic demand, we can supply up to 50,000 tons a month of high-sulfur diesel.”
MRPL recently offered a tender to sell a cargo of high-sulfur diesel, which some traders said may signal that the deal with NIOC had not been extended.
Iran was forced to import motor fuels due to a lack of production from its ageing refineries, and this winter bought diesel from as far a field as Singapore.
It nearly doubled its imports of diesel, used for heating and power generation, to compensate for lost output ahead of shutdowns at its two largest oil refineries in the fourth quarter.
Consultancy PFC Energy estimates that Iran’s oil demand next year would rise 5 percent from an estimated 1.7 billion barrels a day this year. Iran last exported diesel in 2006, it said.
“A higher yield of diesel production has been insufficient to meet the country’s 8 percent average annual demand growth, in turn requiring a 40 percent increase in imports to over 55 million barrels a day (this year),” it added.
MRPL annually imports around 120,000 bpd of crude from Iran for use at its 194,000 barrels-per-day coastal refinery in the southern Indian state of Karnataka.