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Petronet LNG’s net profit for the second quarter of fiscal 2015-16 fell five per cent to ₹248.85 crore against the same quarter last year.
The company's Director (Finance) RK Garg said that the drop in net profit was mainly due to lower offtake from customers and a cost incurred on non-utilisation of some ships.
With spot price of natural gas lower than the contractual price that Petronet has to pay for natural gas from Qatar’s RasGas, the company has reduced offtake from the long-term contract.
During the quarter, the company's net revenue fell 31.2 per cent to ₹7,544.97 crore against ₹10,979.96 crore in the same quarter last year.
Capacity utilisation of the company’s Dahej LNG terminal was maximum during the second quarter at 120 per cent. But at its Kochi LNG terminal, capacity utilisation fell to 2 per cent. “Fertilizer and Chemicals Travancore Ltd (FACT) has stopped offtake, which has resulted in the capacity utilisation falling,” said Garg.
“We have drawn 68 per cent from Qatar this calendar year. Volume-wise, we have not drawn 33 cargoes out of the annual commitment of 120 cargoes. This is till the nine months of the calendar year so far,” said Prabhat Singh, Managing Director and Chief Executive Officer, Petronet LNG.
Singh added that the company is in negotiations with Qatar about the lower offtake and is ‘optimistic’ to find an ‘amicable solution’ soon.
He added that for the supplies from the Gorgon project in Australia ‘market pricing’ needs to be addressed. Supplies from Australia are likely to begin by the end of the 2016 calendar year, Singh said.
Giving his outlook for the LNG demand in the country, Singh said, “Demand is now picking up, but it is now up to us to reach the customer as quickly as possible. We might look at small scale LNG transport wherein we transport the LNG by road to the customer and set up a re-gasification unit at the customer end.”
Plans for the small scale LNG supply business is currently being drawn out and Singh said that by early December the company will be able to share more details. He added that such a model is being adopted in the US, China and other global markets.
On Monday, the company's shares closed 0.76 per cent higher on the BSE at ₹191.05.
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