Indian Oil Corporation Limited (IOCL) - Celebrates 50 years

Company Profile

Indian Oil Corporation Ltd. (IOCL), India's largest commercial ISO-9002  certified enterprise and as a leading public sector enterprise of India, is the  highest ranked Indian company in the prestigious Fortune 'Global 500' listing. IOCL is the 20th largest petroleum company in the world. Established in 1959 as Indian Oil Company Ltd., Indian Oil Corporation  Ltd was formed in 1964 with the merger of Indian Refineries Ltd. (Estd. 1958). It was originally incorporated as IOCL in the year 1964. IndianOil and its subsidiaries account for 48.84% industry market share, 47% petroleum products market share, 40.4% refining capacity and 67% downstream sector pipelines capacity in India. IOCL a traditional manufacturer of refined petroleum products, the new building blocks for global ambition of the corporation are the Petrochemicals, Natural Gas, Exploration & Production, Overseas Business, Consultancy, Biofuels and Hydrogen, etc.

IOCL journey last 50 years

Mission and Vision

A major, diversified, trans-national, integrated energy company, with national leadership and a strong environment conscience, playing a national role in oil security & public distribution

Global Compact Principles addressed in our MISSION statement: To foster a culture of participation and innovation for employee growth and contribution. To cultivate high standards of business ethics and Total Quality Management for a strong corporate identity and brand equity. To help enrich quality of life of the community and preserve ecological balance and heritage through a strong environment conscience.

Products

Indian Oil's product range covers petrol, diesel, LPG, auto LPG, aviation turbine fuel, lubricants, naphtha, bitumen, paraffin, kerosene etc. Xtra Premium petrol, Xtra Mile diesel, Servo lubricants, Indane LPG, Autogas LPG, Indian Oil Aviation are some of its prominent brands. Recently Indian Oil has also introduced a new business line of supplying LNG(Liquefied natural gas) by the cryogenic transportation. The branding called "LNG at Doorstep". LNG headquarters are located in scope complex, Lodhi Road Delhi.

Refineries

 Digboi Refinery, in Upper Assam, is India's oldest refinery and was commissioned in 1901. Originally a part of Assam Oil Company, it became part of IndianOil in 1981. Its original refining capacity had been 0.5 MMTPA since 1901. Modernisation project of this refinery has been completed and the refinery now has an increased capacity of 0.65 MMTPA. 

 Guwahati Refinery, the first public sector refinery of the country, was built with Romanian collaboration and was inaugurated by Late Pt. Jawaharlal Nehru, the first Prime Minister of India, on 1 January 1962. 

 Barauni Refinery, in Bihar, was built in collaboration with Russia and Romania. It was commissioned in 1964 with a capacity of 1 MMTPA. Its capacity today is 6 MMTPA. 

 Gujarat Refinery, at Koyali in Gujarat in Western India, is IndianOil’s largest refinery. The refinery was commissioned in 1965. It also houses the first hydrocracking unit of the country. Its present capacity is 13.70 MMTPA. 

 Haldia Refinery is the only coastal refinery of the Corporation, situated 136 km downstream of Kolkata in the Purba  Medinipur (East Midnapore) district. It was commissioned in 1975 with a capacity of 2.5 MMTPA, which has since been increased to 5.8 MMTPA 

 Mathura Refinery was commissioned in 1982 as the sixth refinery in the fold of IndianOil and with an original capacity of 6.0 MMTPA. Located strategically between the historic cities of Delhi and Agra, the capacity of Mathura refinery was increased to 7.5 MMTPA. 

 Panipat Refinery is the seventh refinery of IndianOil. The original refinery with 6 MMTPA capacity was built and commissioned in 1998. Panipat Refinery has doubled its refining capacity from 6 MMT/yr to 12 MMTPA with the commissioning of its Expansion Project. 

 Subsidiary refineries — Bongaigaon Refinery (2.95 MMTPA),  Chennai Petroleum (9.5 MMTPA)

Globalisation

Sri Lanka

·         Lanka IOC Ltd. began retailing operations in February 2003.

·         Largest private sector company in Sri Lanka, with 11.4% market share.

·         Sales grew by over 8%.

·         Launched bunkering business.

·         18 TMTPA lube blending plant commissioned at Trincomalee; 8 new lube distributors commissioned.

Mauritius

·         IndianOil Mauritius Ltd. incorporated in October 2001.

·         Overall sales rose by 19.5%.

·         Market leader in aviation business with market share of 35%.

·         Market share rose to 19.8%.

Dubai

•  Wholly-owned subsidiary IOC Middle East FZE incorporated in April FZE, 2006, actively pursuing lubricant business in Middle East and Africa.
• Servo distributors appointed for Oman, Qatar and Bahrain.

 Key Financials

Sales for the quarter ended March 2009 were at Rs 59938 crore down by 16.8 % in the corresponding period in the previous year. PBIDT was at Rs 9620.2 crore up by 1782.4 % in the same quarter of the previous year. PAT was at Rs 6623 crore up by 1698.7 % from the quarter ended on March 2008.

Investment Opportunities

 Projects: Indian Oil is implementing projects of over Rs. 60,000 crore currently.

Major ones among them are:

• A 15 MMTPA refinery at Paradip (Rs. 29,777 crore
• Capacity augmentation of Panipat Refinery (from 12 to 15 MMTPA, Rs. 1007.83 crore)
• MS quality improvement projects at Panipat (Rs. 1,131 crore)
• Barauni (Rs. 1,492 crore)
• Guwahati (Rs. 372 crore)
• Digboi (Rs. 356 crore)
• Mathura (Rs. 348 crore) refineries
• Residue upgradation and MS/HSD quality improvement project at Gujarat Refinery (Rs. 5,882 crore)
• Diesel quality improvement & capacity expansion at Haldia Refinery (from 6 to 7.5 MMTPA, Rs. 2,869 crore)
• Naphtha Cracker and Polymer complex at Panipat (Rs. 14,439 crore)
• New product pipelines from Chennai to Bangalore (290 km, Rs. 273 crore),  from Dadri to Panipat (130 km, Rs. 298 crore), branch pipeline from KSPL, Viramgam to Kandla (217 km, Rs. 349 crore).

Brighter future with loss contributors vanishing

 Under-realization may become a thing of past with steep fall in crude oil prices Indian basket of crude oil prices from a peak of US$ 142.04 per barrel on 3rd jul 08 has come down to US$ 68 per barrel on 1st June 2009.
With the sanction of oil bonds by the Government (Rs.32,595 crore or US$ 6.8 Bn), the borrowings to fall sharply leading to significant reduction in interest cost – Indian Oil received oil bonds of Rs.11,975.51 crore ( US$ 2.5 Bn) on 10th Nov’08.
 Indian Oil, a major supplier to core sector
Supplier of fuel (more than 80% of requirement) to Government organizations i.e. army, railways, state road transports, air force & navy Key sectors fertilizer, power & aviation are largely dependent upon Indian Oil.

Bottom Line

In marketing, IndianOil is set to leverage the combined strength of over 32,000 marketing touch points, with focus on hitherto untapped rural markets, non-fuel revenues and pure retailing business. IndianOil aspires to be Asia’s leading commercial R&D organisation in the downstream hydrocarbon sector by building on its capabilities in developing innovative technologies, products and processes, and nodal research in alternative fuels.

Beyond core businesses, IndianOil is working to emerge as a major player in the petrochemicals business by the year 2011-12, with two petrochemical hubs shaping up at Panipat and Paradip. In natural gas business, it is attempting quantum growth in LNG imports, infrastructure and marketing, besides city gas distribution. In the high-risk business of oil exploration & production, IndianOil’s consortium approach with established players is paying off well in terms of exceptional Government support and successful forays in India and abroad. Its current interests are focussed on oil equity and sourcing of natural gas, predominantly from African and CIS countries, by leveraging its downstream capabilities to form joint venture partnerships with reputed enterprises overseas.

With India’s energy needs projected to grow by 40% in the next five years, the future is indeed full of promise for IndianOil; a future the 31,700 strong IndianOil team shall build as they fuel the dreams of over a billion of their countrymen.