Achieves a net profit of Rs.2,090 crore in Q2
Hindustan Petroleum Corporation Ltd. (HPCL) on Friday announced a mega plan to invest Rs.30,000 crore to set up an 18-million tonnes a year refinery in Maharashtra. The 9-million tonnes Bhatina Refinery would be ready by April next, the company said.
Talking to newsmen here to announce the second quarter results, company Chairman and Managing Director Subir Roychowdhary said the new refinery, to be set up along the West Coast, was conceptualised to make up for space constraints at the company's existing Mumbai Refinery.
“We have been told that 1,800 acres are available with the Maharashtra Industrial Development Corporation. We have asked for 1,000 acres more,'' he said.
Engineers India Ltd. (EIL) had been engaged to carry out a feasibility report on the proposed refinery. The options under consideration were a single 18-million tonnes per annum unit or two units of 9-million tonnes each. The detailed feasibility report would be ready by December, Mr. Roychowdhary said.
The land earmarked for the refinery was located between Ratnagiri and Raigad and the unit, Maharashtra Refinery, would be completed within 48 months from the date of receipt of all approvals. “We are doing configuration studies,'' he added.
HPCL face tremendous space constraints at its existing 6.5-million tonnes a year Mumbai Refinery. A refinery of this size is usually spread over 2,000 acres, but HPCL's refinery is situated in a plot measuring just 350 acres. The existing Mumbai Refinery may eventually be shutdown once the new refinery is built.
HPCL is also building a 9-million tonne plant at Bhatinda in Punjab under a joint venture with L. N. Mittal.
Mr. Roychowdhary said the Bhatinda project was on schedule for mechanical completion in March next.
The Bhatinda refinery will cater to fuel demand in Punjab, Haryana, Delhi, Uttar Pradesh and parts of Bihar. HPCL has almost finished laying a product pipeline to transport fuel from Bhatinda to Delhi, from where it can be moved by train to anywhere in Uttar Pradesh and parts of Bihar.
Meanwhile, HPCL reported a net profit of Rs.2,089.61crore in the second quarter of this fiscal against a net loss of Rs.136.68 crore in the year ago period on the back of government subsidy support.
The company lost Rs.6,833 crore on sale of diesel, domestic cooking gas and kerosene below the imported cost during the first half of the current fiscal. Of this, the government gave Rs.2,832.17 crore in cash.
The company did not get any compensation from the government in the second quarter last fiscal, which caused it to suffer a net loss for the three-month period.
HPCL is likely to lose Rs.13,600 crore on subsidised fuel sales during the full fiscal, as it continues to sell diesel at a loss of Rs.2.62 a litre, while the under-recovery is Rs.201.53 a cylinder of LPG and Rs.15.71 a litre of kerosene.
The company's net sales increased to Rs.30,709.73 crore in the second quarter from Rs.24,456.15 crore in the same quarter last fiscal.
HPCL Director (Finance) B. Mukherjee said the company planned to raise $200 million from overseas borrowings by March, 2011, as domestic rupee debt had become more costly.