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Oil cos toughen stand on Jet, Kingfisher dues

Oil cos toughen stand on Jet, Kingfisher dues
PTI
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First Published: Wed, Jan 28 2009. 04 10 PM IST
New Delhi: State-run oil companies have put Jet Airways and Kingfisher Airlines on notice to clear all outstanding beyond credit period and pay interest on it, failing which supplies would be discontinued from 4 February.
IOC, BPCL and HPCL have written to the private airlines to clear the interest on fuel bill beyond the period of credit by tonight, failing which the two airlines would be put on cash and carry from tomorrow, industry sources said.
The state-run firms are demanding that the private carriers pay interest on all their outstanding beyond the credit period as the same was agreed at the time of one-time settlement reached few months back.
Sources said as per the agreement reached between the oil companies and the airlines in October 2008, the outstanding on fuel bills was to be cleared in six monthly installments and future purchases were to be done on commercial terms.
The three oil companies had given a 90-day credit period to private airlines on their current fuel purchases and they are now demanding clearance of all dues beyond this credit period.
Naresh Goyal’s Jet Airways and Vijay Mallya-owned Kingfisher Airlines and state-run NACIL together owe over Rs2,000 crore in fuel bills to Indian Oil, Bharat Petroleum and Hindustan Petroleum, as on 21 October when the agreement was reached.
Jet’s total outstanding to IOC, the nation’s largest oil firm, as on 21 October stood at Rs859 crore, while Kingfisher owed Rs110 crore to IOC.
Jet owes Rs284.3 crore to Bharat Petroleum, while Kingfisher owes Rs246 crore to BPCL and Rs525 crore to HPCL as on 21 October.
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First Published: Wed, Jan 28 2009. 04 10 PM IST
More Topics: Airline | Credit | Jet | Kingfisher | BPCL |