IOC Chairman optimistic about revival

Mumbai, Sep 22 (UNI) Indian oil Corporation (IOC) will strive to wipe out its losses through diversification and mergers in the coming days, the company's Chairman Sarthak Behuria today said.

Talking to mediapersons, after the 47th Annual General Meeting (AGM) of shareholders here, he said that the Corporation is incurring a loss of Rs 2,000 crore every month. To overcome this negativity, exisitng subsidy measures has to be re-examined along with grants, he added.

He said that IOC will invite open tenders for the sale of Ethanol and procedures for the same are at its final stages. In addition the corporation will sell Ethanol from all its centres nationwide, he added.

Ruling out a joint venture with Reliance or any other firms for the time being to explore gas, Behuria made it clear that IOC is still in the process of exploring the right sellers of gas.

However, he pinpointed that the Corporation will overcome its current phase and expects that the overall perfomance of the company should be better in the next fiscal year.

Declining to elaborate further, he said that mergers will reduce the loss of the Corporation to atleast 30 per cent. But, added that the current loss can only be minimised to Rs 1,000 by the next fiscal year.

Elaborating on the 8,000 crore grant, the Corporation plans to expand its refinery in Panipat and Haldia. Whereas, funds may be allocated for laying of pipelines in Paradeep also.

On a positive note, Behuria said that he expects positive signs in production of Petrol, Diesel and an overall restructuring in the production of Kerosene and diesel soon.

He asserted that the Corporation will undergo a revamb to be competitive and would focus on the domestic markets as its prime target.

In late 2003, prices of crude oil and petroleum products in the international markets became volatile as a result of global demand, limited surplus capapcities and severe Geo-political tensions in oil producing countries of the Middle East and Africa.

Prices of crude oil in India rose to USD 56 per barrel in 2005-06 as compared to USD 30 per barrel in 2003-04. India, which consumed about 112 million tonnes of petroleum products in 2005-06, currently imports over 75 per cent of its crude oil requirements.

Even though the government formulated a loss sharing mechanism through discounts from upstream oil companies and refiners. The substanial rise in the burden strained the budgetry resources of the public sector oil marketing companies (OCMs), including the Indian Oil Corporation.

Accordingly, a provision was made in the Union Budget 2005-06 for additional support to OMCs by way of ''Oil Bonds'' over and above the amount allowed as subsidy. The issuance of these bonds helped the OMCs tide over the financial crunch to some extent.

UNI GVS MJ SKB1702