::CPCL’S Performance During 2005

CPCL’S Performance During 2005 - 06

Mr. K. K. Acharya, Managing Director, CPCL, addressing the media on the performance of CPCL for 2005 - 06, in chennai on 15.05.2006.
From left to rigth: Mr. S. Ansar Shah, Chief Manager(PR), Mr.N. C. Sridharan, Director(Finance),
Mr.A. Kasturi Rangan, Director(Operations), Mr. V. Srinivasan, Manager(HR) and Company Secretary

Production: Crude thruput up by 16%
The crude thruput for the year 2005-06 was highest-ever at 10.36 Million Metric Tonnes (MMT) against MoU target of 10.2 MMT. The crude processing was 16% higher than the previous year crude thruput of 8.92 MMT. During the year, Manali Refinery processed 9.68 MMT and Cauvery Basin Refinery (CBR) processed 0.68 MMT.
CPCL’s MoU target for 2006-07 has been set at 10.4 MMT.

CPCL’s ACHIEVEMENTS DURING 2005-06

Capacity utilization of 102% achieved in crude units at Manali Refinery.

Secondary processing units, viz. FCCU and OHCU also recorded capacity utilization of 110% and 106% respectively in the first full year of operation.

Even at the enhanced crude thruput, the distillate yield percentage level could be maintained by higher secondary units processing.

Processing of high sulphur crude oil during the year was 69%, which very few refineries in the country do. As a step towards widening the crude oil basket for the refinery, CPCL processed 4 new crudes during 2005-06 i.e. Forozon from Iran, Saharan Blend from Algeria, Benchamas and Tantawan from Thailand.

Energy Index
Energy Index of Manali Refinery has been improving over the years and it was at the best so far at 77.1 during the year 2005-06. Action plan has been drawn to bring it down further to about 72 in the next two years with energy conservation measures.

Product Exports
Domestic sales have been maximized and our refinery products are moving up to Kolkatta on the East Coast and up to Goa, Mumbai and Kandla in the West Coast after meeting local demand. Tank Leasing Operations have been taken at various locations so as to position CPCL’s product on LLC basis. The surplus products to the extent of 641 TMT have been exported to various countries like Singapore, Bangaladesh etc. during 2005-06. The export was done through IOC and the value of the export increased from Rs.549 Cr. in 2004-05 to Rs.1,321 Cr in 2005-06.

Highest Production and Despatch

Highest-ever production and despatch of LPG, MS, ATF, HSD, SKO, Asphalt and Propylene at Manali Refinery in 2005-06.

Also at CBR, highest-ever Naphtha despatch was achieved during the year.

CPCL was the first refinery in the Southern Region to produce MS & HSD of Euro-III specifications from Jan’05 well ahead of schedule.

During the year 2005-06, besides meeting demand of EURO III products for Chennai, CPCL also supplied to other Metros like Kolkatta and Mumbai.

TURNOVER : IMPRESSIVE INCREASE OF ABOUT 56%
The turnover for the year 2005-06 was the highest-ever at Rs.25,409 Crore as against Rs.16,270 Crore in the previous year registering an increase of about 56%. The turnover was higher mainly due to increase in crude thruput and higher prices for the products based on import-parity.

PROFIT AFTER TAX
The Profit Before Interest, Depreciation and Taxes (PBIDT) (before providing Rs.439 Crore as discounts to marketing companies as part of subsidy sharing scheme in respect of SKO (PDS), LPG (Domestic), MS and HSD) for the year 2005-06 is Rs.1572 Crore as against Rs.1300 Crore during 2004-05 (an increase of 21%) where no such scheme was in vogue.

The PBIDT for the year 2005-06 after such discounts stands at Rs.1133 Crore.
The Profit Before Tax is Rs.723 Crore as against Rs.934 Crore for the previous year.
The Profit Before Tax before offer of such discounts to marketing companies would have been Rs.1163 Crore.
The Profit After Tax (PAT) for the current year is Rs.481 Crore as against Rs.597 Crore for the previous year.

GRM for the refinery is about US$ 5.66 for the year 2005-06.

CPCL has to bear the subsidies from the year 2005-06 for LPG, MS, SKO & HSD which works out to about US$ 1.3 per barrel due to non-revision of petroleum products.

DIVIDEND
The Board of Directors has recommended a dividend of 120% for 2005-06. Of this, 30% has already been paid as interim dividend.

CPCL’S IMPRESSIVE RECORD ON PLAN OUTLAY UTILISATION
CPCL’s X Plan outlay is Rs. 2400 Crore. During the first four years of the 10 th Plan, an expenditure of Rs. 2215 Crore has been incurred. 100% expenditure on Plan schemes has been achieved for the 4 th consecutive year. As against the approved outlay of Rs.110 Crore for the year 2005-06, the actual expenditure was Rs.110.55 Crore.

The major projects considered in the X Plan outlay are 3 MMTPA Refinery Expansion cum Modernisation Project & FCCU De-bottlenecking Project.

NEW FACILITIES COMMISSIONED BY CPCL
Water Management at CPCL
Chennai City is a water-starved Metro. Manali Refinery needs 1520 KL/hr of fresh water. Out of this, 48% is only outsourced today. CPCL is investing around Rs.289 Crore to be self-sufficient in water. To this effect, Zero Discharge Plant was commissioned in Sept’05, 2.5 MGD Sewage Reclamation Plant will be commissioned during this year and the 5.8 MGD Desalination Project will be commissioned in the next year.

Zero Discharge Plant
A new Zero Discharge Plant of 200 KL/Hr. for treating effluents from Refinery III and reuse of treated water completed at a cost of Rs. 10.50 Crore in September 2005. This project has significantly contributed in improving water availability position of Manali refinery operations. Also it has reduced the quantum of fresh metro water intake to the refinery, thereby reducing the operating cost.

Additional 2.5 MGD Capacity Sewage Reclamation Plant
A project for installation of an additional 2.5 MGD Capacity Sewage Reclamation Plant at an estimated cost of Rs.46.68 Crore is being implemented currently. This project will enhance the water availability for Manali refinery, and is expected to be completed by September 2006.

5.8 MGD Desalination Project
A project for installation of a 5.8 MGD Sea Water Desalination plant at an estimated cost of Rs.231.34 Crore is being implemented. Raw water supply from this project will ensure uninterrupted Refinery operations even during periods of water shortage in the city. This project is expected to be completed by June 2007.

Preparedness for Euro-IV Products
As per the Auto Fuel Policy of the Government, CPCL has taken up Projects for supplying Euro-IV MS and HSD to the market well before the scheduled date of 1 st April 2010. The projects under consideration are:

DHDS Capacity augmentation at a cost of Rs.170 Crore to produce and supply a minimum of 1 MMTPA of Euro-IV HSD to Metros.

New DHDT Unit at a cost of Rs.700 Crore for Diesel Desulphurisation.

Isomerisation Unit of 150 TMTPA at a cost of Rs.150 Crore for production of Euro-IV MS.

Catalytic Reformer Unit Revamp from 225 to 305 TMTPA at a cost of Rs.150 Crores for increasing MS production and improvement in Octane from 96 to 102.

NEW PROJECTS AND INITIATIVES
Crude Oil Pipeline Project
A new 42” crude oil pipeline as a replacement of the existing 30” aging crude oil pipeline is proposed to be laid from Chennai Port to Manali Refinery along the route of the proposed Port Connectivity Road. The estimated project cost is about Rs.65 Crore.

Refinery Capacity augmentation at Manali
Capacity enhancement through low cost unit revamps at Manali refinery to increase its refining capacity by about additional 1.7 MMTPA, completion by 2008.

Resid Upgradation Project
To improve the distillate yield of Manali refinery, Feasibility study is being undertaken to set up Resid Upgradation facilities.

Offsite Automation Project
A project for installation of Offsite Automation facilities at an estimated cost of Rs.26.77 Crore is being implemented. This project is expected to be completed by December 2006.

20 MW Gas Turbine Project
A project for installation of a 20 MW Gas Turbine at an estimated cost of Rs.147.00 Crore is being implemented in order to enhance the reliability and quality of captive power generation at Manali refinery. The project is expected to be completed by November 2007.

Propylene Unit Expansion and Poly propylene Unit:
The option of putting up a Polypropylene production unit is being evaluated. Enhancement of CPCL’s Propylene production capacity will be implemented soon due to high market demand. Chennai Metro is an Automobile Hub and has a huge potential for marketing of the Polypropylene product.

RENEWABLE SOURCES OF ENERGY
Windmill Power Project
In order to promote clean energy and contribute to the global movement in reducing green house gas emissions, CPCL is planning to set up a Windmill Power Project of about 17 MW capacity to meet the power requirements of its 5.8 MGD Desalination Plant.

Bio-Diesel
At CBR in about 60 acres in Phase-I cultivation of Jatropha Curcas has been initiated for production of bio-diesel.

Chennai-Trichy-Madurai Pipeline (CTMPL) has been commissioned in August 2005 for movement of products like SKO, MS and HSD to Trichy, Madurai and Sankari market fed zones.

Work started for a dedicated ATF pipeline from Manali Refinery to Chennai Airport.

Product pipeline from Chennai to Bangalore is also envisaged.

CORPORATE SOCIAL RESPONSIBILITY
CPCL has been committed in the areas of Community and Sports Development and provided necessary relief to the flood affected areas and the expenditure is around Rs.185 lakhs during 2005-06.