MRPL posts Rs 300 crore loss

MRPL posts Rs 300 crore loss
ENS ECONOMIC BUREAU

MUMBAI, JUNE 30: Mangalore Refinery and Petrochemicals Ltd (MRPL), promoted by HPCL and the Aditya Birla group, has posted a whopping loss of Rs 299.68 crore for the year ended March 2000 as against a profit of Rs 14.06 crore recorded in the previous year.

The total turnover in 1999-2000 rose by 25 per cent to Rs 3,021 crore, MRPL said in a release here today. ``Two factors impacted the profitability adversely. Firstly, lower margins between international crude prices and MRPL's product price and secondly, lopsided duty structures on crude oil and the company's product price,'' it said.

Depreciation in the fiscal 1999-2000 stood at Rs 142.76 crore compared to Rs 134.45 crore in the previous year. The increase in depreciation was due to capitalisation of certain utilities. During the year, MRPL processed 37.75 lakh tonnes of crude oil and despatched 34.12 lakh tonnes of finished products comprising liquefied petroleum gas (LNG), it said.

MRPL has been hit by the lopsided duty structures on crude and finished products. To encourage new investments in refining, the deregulation process envisaged duty protection of ten per cent in 1999-2000. In reality, however, the effective duty protection is only six per cent since customs duty for products like liquefied petroleum gas (LPG), naphtha and kerosene is less than that imposed on crude.

According to industry sources, stand-alone refineries like MRPL were facing hard times in addition to a heavy burden of high depreciation and interest costs. He suggested bringing in a differential tariff for new refineries and warned that unless quick remedial measures were taken at the policy level, things could turn from bad to worse.