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Mr Murli Deora, Minister for Petroleum (file photo).

Our Bureau

New Delhi, Oct 16 The Petroleum Ministry wants both Jet and Kingfisher Airlines to clear their outstanding dues on air turbine fuel (ATF) purchased from public sector oil companies — Indian Oil Corporation, Bharat Petroleum Corporation and Hindustan Petroleum Corporation — at the earliest.

While Jet Airways has defaulted on payments of Rs 259 crore, Kingfisher has an outstanding of Rs 60 crore. The defaults account for the amount that has remained unpaid after the lapse of the credit time. Expressing concern over the timing of layoffs of staff announced by Jet Airways, Mr Murli Deora, Petroleum Minister, told newspersons here that “different airlines have different credit limits with the oil companies. There should not be a crisis situation.”

“We want to help the airlines so that there are no job losses. We are in touch with the Finance Ministry to explore if banks can give credit to airlines so that they don’t default on their dues to the oil companies. But payment commitments must be honoured,” he said.

Jet Airways has a 60-days credit with IOC, but has not paid the amount that was due on September 25 and October 5. Jet Airways’ total outstanding stood at Rs 859 crore, of which it has defaulted on payment of bills amounting to Rs 259 crore. Kingfisher Airlines’ outstanding was Rs 110 crore, of which Rs 60 crore remained unpaid.

National Aviation Company of India Ltd (NACIL) did not have any grace period with oil companies and had an outstanding of Rs 606 crore as on October 8.

Petroleum Secretary Mr R S Pandey said, “Here’s a case of default even beyond the credit limit.” Jet bought ATF worth Rs 330 crore every month, Kingfisher bought jet fuel worth Rs 72 crore every month, and NACIL’s monthly bill was Rs 337 crore. “These are difficult times for airlines, but oil companies are also practically living on borrowings. The airlines have to clear their outstanding at the earliest,” he said.

More Stories on : Airlines | Petroleum

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