ENP Newswire - 12 February 2014
Release date- 10022014 - Mumbai - Essar Oil, India's second largest private refiner, reported its highest ever GRM premium over the benchmark IEA margin at $9.33 /bbl during the quarter ending December 31, 2013.
Essar Oil's current price gross refining margin (CP GRM) for the October-December 2013 quarter (Q3FY14) stood at $7.93/ bbl, compared to $9.75 per barrel in Q3FY13. Benchmark IEA margin during the quarter was minus $1.4/bbl versus $0.76 in the corresponding quarter last year.
Gross revenues for Q3FY14 stood at Rs 27,385 crore, up 6% over Rs 25,909 crore in Q3FY13 EBITDA at Rs 1,202 crore was almost at the same level compared to Rs 1,241 crore in Q3FY13. Profit after tax for the quarter was up 63% to Rs 52 crore against Rs 32 crore in the same period last year.
The Vadinar refinery, at 20MMTPA capacity and 11.8 complexity, is India's second-largest single site refinery and amongst the most complex globally for a facility of this scale. During the quarter, Vadinar refinery processed 4.86MMT of crude, which was lower than 5.14MMT in the corresponding period last year, due to a planned -7-day shutdown in November 2013.
Taking advantage of the increased spread between light and heavy crude, Vadinar refinery processed 98% of heavy and ultra heavy crude in its crude diet, which is the highest ever. During the quarter, Arab heavy and light differential rose 22% sequentially. Despite processing such a high proportion of heavy and ultra heavy crude, production of valuable middle and light distillates stood at 84% of the refinery's product slate.
Nine month performance
For the nine month period ending December 31, 2013, Essar Oil reported strong revenue growth of 12% to Rs 79,498 crore, against Rs 71,040 crore reported during the same year ago period. Throughput during the nine month period was up 3% to 15.18MMT.
EBITDA for the nine-month period ending December 31, 2013 jumped 27% to Rs 2650 crore from Rs 2,094 crore in 9MFY13. PAT was negative Rs 882 crore against negative Rs 1,381 crore in 9MFY13.
Talking on the results, Mr LK Gupta, Managing Director and CEO, Essar Oil, said: 'We had an excellent quarter during which we demonstrated further improvement in all our operational areas, from refinery to marketing to finance. In spite of benchmark margins continuing to languish due to lower gasoline and fuel oil cracks, Essar Oil has delivered very good margins. Our premium over the benchmark IEA margins at $9.33/bbl is at an all time high, demonstrating benefits of higher complexity.'
Mr. Suresh Jain, CFO, Essar Oil said, 'We have witnessed a stable quarter both in terms of oil prices and foreign exchange. In spite of a planned shutdown of about seven days, we improved our topline and bottomline, demonstrating all round operational excellence. We are progressing well on dollarization of our rupee debt to reduce our interest cost, which has already begun to show a declining trend, and have dollarized - $900 million worth of rupee debt through ECBs and swaps.'
During the quarter, Essar Oil realized 58% of its revenues from the domestic market, against 44% in the immediate past quarter on account of improved domestic demand for gasoil.
The company sees good potential in retail for value creation as the country moves towards deregulation of diesel. Essar Oil has about 1,400 retail outlets across the nation, with another 200 in various stages of commissioning. The company is now actively considering expansion plans in retail in view of reasonable certainty of deregulation of diesel in the future.
Exploration and production
At our flagship Raniganj CBM block, current gas production is around 120,000 standard cubic meters per day (scm/d), which is being sold locally through pipeline and cascades. About 183 wells have been drilled, with -120 wells in production.
About Essar Oil
Essar Oil is a fully integrated oil & gas company of international scale with strong presence across the hydrocarbon value chain from exploration & production to refining and oil retail. Essar Oil owns India's second largest single site refinery having a capacity of 20MMTPA and complexity of 11.8, which is amongst the highest globally. It has a portfolio of onshore and offshore oil & gas blocks with about 1.7 billion barrels of oil equivalent in reserves and resources. There are more than 1,600 Essar-branded oil retail outlets in various parts of India.
Essar is a US$ 39-billion multinational corporation with investments in steel, energy, infrastructure and services. With operations in more than 25 countries, it employs over 73,000 people.
IEA benchmark margins referred in this release are IEA Singapore Complex Refinery Margins, calculated on old methodology.
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