The Hindu Business Line : IOC hopes Govt will address under-recoveries

The Indian Oil Chairman, Mr Sarthak Behuria, has said that the company was expecting the Union Government to address issues related to mounting under-recoveries"shortly".

Relief is expected through a combination of measures as recommended by the OMCs and expert committees, Mr Behuria said.

As per current market price vis-a-vis crude price, IOC's under-recoveries on sale of petrol and diesel are to the tune of Rs 10 per litre. The company is losing Rs 14 per litre on sale of kerosene and Rs 191 per LPG cylinder.

Working capital

Admitting that working capital was under strain, Mr Behuria, made it clear that the projects undertaken by the company would not be affected owing to the crisis. Asked how long IOC would be able to take such pull on its working capital, he said, "It should see us through for the next three months".

On the alleged ban by the Union Ministry of Petroleum and Natural Gas on expansion of retail outlets by oil PSUs, he said that IOC has already decided against further expansion of outlets and consolidate its market share in the retail segment. "We will set up new outlets in the rural segment, which is beyond the scope of the recent directive by the Ministry".

Branded diesel

IOC Director, Marketing and Chairman of IBP, Dr Kannan, said that as part of the consolidation exercise, the company has decided to make its branded diesel available in at least 50 per cent of the 15,247 outlets (of IOC-IBP combine) in the next three months. Branded petrol will be available in 3,500 outlets as against the existing 2,762.

The company has also revived its scheme of converting select outlets into Xtra Care outlets. Automation will be done in 1,000 outlets to ensure supply of non-adulterated fuel.

The contribution of the Xtra Power fleet card towards the total diesel sales by IOC is expected to increase from 14 per cent to 20 per cent.