ONGC, India's largest oil producer, will not sell crude oil to private refiners like Reliance Industries Ltd for at least one more year and will continue to supply a little over 26 million tonnes of its production to public sector firms.

"It has been decided that ONGC will continue to sell 26.2 million tonnes of crude oil to public sector refiners -- Indian Oil Corporation, Hindustan Petroleum Corporation Ltd and Bharat Petroleum Corporation Ltd -- next year," petroleum secretary B K Chaturvedi told PTI after chairing a meeting with heads of state-run oil companies on crude allocation for 2004-05, in New Delhi.

After the dismantling of administered pricing mechanism in April 2002, ONGC entered into a two-year pact with IOC, BPCL and HPCL for supply of 26.2 million tonnes of crude (24.7 million tonnes from fields owned by it and 1.58 million tones from joint venture fields). It had the freedom to sell any incremental production over and above the 2001-02 levels to any of the refiners at best price.

"RIL's Jamnagar refinery is a more versatile refinery capable of processing a wide range of high and low sulphur crude. ONGC's mainstay Mumbai High sweet crude is the lifeblood of older public sector refineries. So they will continue to get those supplies," he said.

Chaturvedi said the quantities to be supplied to individual refineries and the price would be worked out between the buyer and seller.

ONGC, which had desired to sell all of its 27.5 million tonnes output from 2004-05 on biddable best price, will have the freedom to market 1.5 million tonnes of incremental production to anyone.