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PSU oil firms'' revenue losses may widen to Rs 57,000 cr

Category  :  Industry
Date  :  Aug-03-2010 09:46

Indian Oil Corp (IOC), Hindustan Petroleum and Bharat Petroleum witnessed their revenue loss on fuel sale widening to Rs 57,000 crore this fiscal.It is up from Rs 53,000 crore estimated at the time of June price hike.Meanwhile, the 3 retailers are losing Rs 131 crore per day on sale of diesel, domestic LPG and kerosene.IOC, HPCL and BPCL, however, were projected to lose Rs 53,000 crore after decontrol of petrol price.This resulted in an Rs 3.50 per litre rise in retail prices as well as a Rs 2 per litre increase in diesel rates.It also resulted in an Rs 35 per cylinder rise in LPG price and Rs 3 per litre raise in kerosene rates from June 26. In the meantime, international oil rates firmed up and the revenue loss is now estimated at Rs 57,000 crore in 2010-11 fiscal.Out of this, around Rs 20,275 crore is for selling fuel below cost in Q1 of this fiscal.However, after upstream firms ONGC, GAIL and IOC contributed Rs 6,690.68 crore, Q1 revenue loss was reduced by one-third.IOC, BPCL and HPCL, however, currently sell diesel at a loss of Rs 2.76 a litre, kerosene at a discount of Rs 15.41 and LPG at a loss of Rs 170.57 per cylinder.On the other hand, ONGC, state gas utility GAIL and OIL give discounts to the 3 retailers on the crude oil and LPG they buy to partly make up for the losses.Meanwhile, in June the government freed petrol prices.There will be no under-recovery on this motor fuel in the remaining part of the year.Earlier, India''s crude oil production increased 6.8 per cent in June due to higher output from Rajasthan fields operated by Cairn India.Meanwhile, crude oil output increased to 2.93 million tonnes in June 2010.This, however, is as against 2.75 million tonnes a year ago.From the Mangala oilfield in the Rajasthan block, Cairn India is producing about 110,000 barrels per day (5.5 million tonnes a year). Oil and Natural Gas Corp (ONGC), however, witnessed a marginal decline in its production to 2.021 million tonnes from 2.026.This is although output from its prime Mumbai High field rose 2 per cent to 1.43 million tons. Oil India Ltd, however, reported a 8.7 per cent drop in production at 264,000 tonnes.Moreover, during April-June, India''s crude oil production was up 5.9 per cent to 8.75 million tonnes.This is ONGC contributing 6.07 million tonnes.The country"s 19 public and private sector refineries at 13.5 million tonnes turned 2.9 per cent more crude oil into products.In the meantime, Reliance Industries saw a modest 1.6 per cent expansion to 2.9 million tonnes.This is while state-owned Indian Oil Corp (IOC) reported a throughout growth of 3.4 per cent at 9.37 million tonnes.During April-June, refinery throughout was up 5.3 per cent at 40.39 million tonnes. The natural gas production increased 25.5 per cent to 4.5 billion cubic meters due to the output from RIL''s eastern offshore KG-D6 fields.On the other hand, KG-D6 fields are currently producing around 60 million standard cubic meters per day. During the quarter ended June 30, gas output rose 37 per cent to 13.6 bcm.Crude Oil, or petroleum is a mixture of different hydrocarbons. The fractional distillation of crude oil is a key industrial process.This is as it produces compounds such as methane, bitumen and gasoline.

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