Mangalore Refinery's new initiative

By Our Corporate Reporter

CHENNAI, AUG. 19. Mangalore Refinery and Petrochemicals, a joint venture company of HPCL and the Aditya Birla group, had undertaken several initiatives to improve its performance. It has appointed Lazard India for carrying out a comprehensive financial restructuring exercise.

MRPL is directly importing crude to meet its own requirements with the assistance of Chevron and Texaco (International oil majors) and has bought several new crudes, which were processed in India.

In addition to the support enjoyed by MRPL from HPCL to market its products, MRPL has commenced direct marketing of free trade projects. The company has represented to the Ministry of Petroleum and Natural Gas for grant of marketing rights of the formula products prior to April 2002 as the company qualifies the investment criteria made in this regard.

MRPL is contributing 26 per cent equity in the Mangalore Hassan Bangalore pipeline project. As on July 15, the project has achieved physical progress of 85 per cent and is expected to be completed in mid 2002. The MHB pipeline would enable reaching of MRPL products to wider markets in the hinterland and is expected to play a vital role in evacuating MRPL's products. The company claims the dual operating streams and economies of scale are expected to improve MRPL's operational performance in the near future.

Despite various measures initiated by the company may have a positive impact to some extent, factors such as the movement of crude and product pieces in the international markets coupled with inadequate tariff protection, imbalance in demand and supply position in the country and the high interest and depreciation burden would continue to have a significant impact on the performance of MRPL.

The company has reported a higher turnover of Rs. 1,680 crores for the first quarter of 2001-02 against Rs. 827 crores. Other income accounted for Rs. 56.72 crores against Rs. 7.23 crores.

After providing interest of Rs. 159.98 crores (Rs. 81.59 crores) and depreciation of Rs. 86.01 crores (Rs. 37.49 crores), the loss before tax and extra-ordinary items was Rs. 115.33 crores against Rs. 99.01 crores.

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Section  : Business
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