Mangalore Refinery and Petrochemicals Ltd. (MRPL) currently buys 22,000 bpd oil from Saudi Aramco under an annual deal, and the refiner is diversifying its crude slate to feed a 25 percent expansion of its capacity to 300,000 bpd next year.

“In September MRPL’s managing director had asked for additional supplies from Saudi Arabia, ” said one of the sources.

Saudi Aramco’s offer would equate to nearly 10 percent of MRPL’s current crude imports.

The company, India’s fourth biggest state-run refiner, imported Kuwait crude oil for the first time earlier this year.

Saudi Aramco has just sold an extra one million barrels for December to at least one Chinese refiner, an industry source said.

Indian refiners are scouting for new barrels and raising purchases from existing suppliers to cushion against any further disruption to imports from Iran, which halted shipments briefly in August when payments dried up under US pressure.

That payments issue with Iran has now been resolved but a US House Panel recently approved tougher sanctions on the country, hitting out at Iran’s central bank, which uses Turkey’s Halkbank to handle funds from oil exports to India.

MRPL is the biggest Indian client of Iran, buying about 150,000 bpd of oil.

The company plans to raise its refining capacity to 360,000 bpd by 2015/16.

“We are looking to buy from Latin American countries, Azerbaijan and the Middle East. We can also buy (crude) from Iraq to meet our expanding refinery capacity,” Managing Director U. K. Basu said last month.

OPEC meets in December after June discussions broke down as it failed to lift production to compensate for the loss of Libyan output.

Since the June meeting, Libya has returned to the market and the country could be producing 750,000-800,000 bpd by the end of 2011, OPEC Secretary General Abdullah Al-Badri said on Tuesday.

Badri said the group was unlikely to produce more than its current output within the next few months, echoing comments by other officials in the group.

OPEC member Qatar has said it does not expect surprises at the Dec. 14 meeting in Vienna, echoing comments by Iraq’s deputy prime minister for energy, Hussain Al-Shahristani.