New Delhi: State-owned Indian Oil Corp Monday reported 52 percent rise in net profit during three months ended December 31 as one-time outlay to pay entry tax to Uttar Pradesh offset most of the gains from higher fuel subsidy received.
Net profit in the October-December quarter this fiscal soared to Rs 2,488.44 crore, as against Rs 1,634.76 crore in the year-ago period, IOC Chairman R S Butola told reporters.
"We had made a provision of Rs 6,168 crore for payment of entry tax (on crude oil and gas imported in Uttar Pradesh for use at Mathura refiner)," he said.
IOC had challenged the Uttar Pradesh government decision to levy a USD 5.78 a barrel entry tax on crude oil the company imported into the State for processing at its 8 million tones per annum refinery at Mathura in the Supreme Court.
The apex court asked IOC to deposit 50 percent of the assessed till 2007-08. The Rs 6,168 crore is the liability from that time till date.
IOC received government compensation to make up for part of the revenues the company lost on selling diesel, domestic LPG and kerosene below cost for second and third quarter during the quarter under review, he said.
The government has promised to give about 46 percent or Rs 45,000 crore of the Rs 97,300 crore in revenue that IOC, Bharat Petroleum and Hindustan Petroleum lost on selling diesel, domestic LPG and kerosene below cost in first nine months of current fiscal.
Also, the government raised contribution of upstream firms like Oil & Natural Gas Corp (ONGC) to 37.91 percent of the total revenues that retailers like IOC lost on selling fuel below cost. Upstream firms had in first half made good one-third of revenue lost. The increased upstream share for the first half also came in the third quarter, boosting profit.
For the first nine months this fiscal, IOC reported a net loss of Rs 8,715.81 crore as part of the losses on fuel sales were not covered by the government compensation scheme.
Butola said IOC lost Rs 53,321 crore in revenue on diesel, domestic LPG and kerosene sale from April-December. Of this, it got Rs 20,189 crore from upstream firms like ONGC and another Rs 24,625 crore from the government in form of cash subsidy.
"After accounting for upstream assistance and government subsidy, we had to absorb Rs 8,507 crore of net under recovery on fuel sales," Butola said.
The receivables from the government includes IOC's share from the Rs 15,000 crore that the finance ministry last week agreed to give to make up part of the revenue that fuel retailers lost in the October-December quarter.
Previously, the government had sanctioned Rs 30,000 crore to cover for less than half of revenue that retailers lost on fuel sales in April-September period.
IOC earned USD 4.31 on turning every barrel of crude oil into petroleum product in October-December quarter, as against USD 5.88 per barrel gross refining margin it earned in the same period a year ago, he said.
Turnover increased to Rs 104,064.42 crore in Q3 from Rs 93,867.75 crore a year ago.
First Published: Monday, February 13, 2012, 20:29