IOC loss to shrink by Rs 2,000 cr

Indian Oil Corporation on Thursday said its under-recoveries would come down by Rs 2,000 crore (Rs 20 billion) in the next six months on account of the price hike in the petroleum products.

IOC would get a benefit of Rs 2,000 crore due to the recent price hike in the petroleum products and is expecting Rs 6,000-7,000 crore share in the oil bonds to be released by the government to the oil marketing companies, IOC chairman

Sarthak Behuria said at the annual general meeting of the company in Mumbai. He said there were under-recoveries of Rs 8.50 per litre for petrol, Rs 8 for diesel, Rs 12 for kerosene and Rs 96 per LPG cylinder.

IOC had taken a hit of Rs 6,800 crore (Rs 68 billion) during the first half till September on account of under recoveries, he said.

However, the company was not planning to defer any of its investment plans and would invest Rs 70-80 billion (Rs 700 to 800 crore) by 2011-12.

IOC which has vision to grow from a $35 billion turnover company at present to $60 billion by the year 2011-12 has blueprints for investments to the tune of Rs 70,000 crore (Rs 700 billion).  Out of this, capital investments in the X Plan period, alone accounts for Rs 24,400 crore (Rs 244 billion), he said.

On IOC's investment plans, Behuria said the company is implementing a Rs 25,000 crore (Rs 250 billion) market plan to emerge as a leading petrochemicals player in the country.

With the commissioning of the world's single largest linear alkyl benzene plant at Gujarat refinery, IOC has secured nearly 30 per cent share of LAB business in the shortest possible time, he said.

IOC is doubling its investment in Mauritius to $ 35 million for augmenting tankage capacity and setting up the island nation's first laboratory for product testing, he said adding, it is exploring opportunities for acquiring a suitable medium-sized E&P company to quickly enhance its stake in the profitable upstream operations.

The state-run oil refiner is setting up two major petrochemical projects at the Panipat Refinery complex in Haryana, which includes an integrated PX/PTA

(paraxylene/purified terephthalic acid) plant scheduled for commissioning this year and a Naphtha Cracker with downstream polymer units to be completed by the year 2007-08.

It has also planned a refinery-cum-petrochemicals complex at Paradip on the east coast and is tapping new markets in neighbouring countries for export of its products and services.