Refining major Essar Oil Ltd has reported a profit of Rs 32 crore for the quarter ending December 31, on account of higher gross refining margins (GRM). In the year ago quarter, the company had registered a loss of Rs 3,986 crore.
The GRM is the difference between the total value of petroleum products produced by an oil refinery and the price of crude oil.
On the other hand, net sales for the quarter increased by 85 per cent to Rs 23,817 crore (Rs 12,851 crore) due to better throughput at the Vadinar refinery.
The refinery has a 20 million tonne per annum capacity and during the quarter, it processed 5.14 million tonnes of crude, up 83 per cent over Q3FY12.
For the quarter, the GRM was $ 9.75 per barrel, almost 4 times the $2.82 per barrel in the year ago quarter. The company achieved the higher GRMs due to its enhanced ability to process heavy crudes.
Heavy crude
Heavy crude in the international market is available at lower prices. The expansion and optimisation projects at the refinery also helped clock higher GRMs.
Essar Oil’s Managing Director and CEO, L.K. Gupta said that the share of ultra heavy crude in the refinery’s input diet rose almost threefold to 67 per cent from the corresponding quarter last year, and production of valuable middle (LPG and petrol) and light (kerosene and diesel) distillates improved to 85 per cent of the refinery’s product mix from 69 per cent in the same period last year.
Heavy and ultra heavy crude constituted 84 per cent of the refinery’s crude diet during the quarter, against 74 per cent in Q3FY12, he said.
Essar Oil’s CFO Suresh Jain added: “With current price GRM continuing to remain firm, the company has witnessed a major jump in its overall earnings performance in the third quarter. Our EBIDTA and PAT would have been higher by Rs 260 crore this quarter, if not for the foreign exchange gain accounted in the previous quarter,” he said.
Coal Bed Methane
The company in a statement said that at the Raniganj Coal Bed Methane (CBM) block, current gas production is around 55,000 standard cubic metres per day (scmd), against 30,000 scmd a year ago. The company has completed drilling 120 wells. Environment clearance for 618 wells is in progress.
On the BSE, the stock marginally dipped to Rs 72.80 over the previous closing price of Rs 73.25.
rahul.wadke@thehindu.co.in