New Delhi: Mangalore Refinery and Petrochemicals Ltd (MRPL) said it expects crude oil imports from Iran to be 3.8 million tonnes (mt) in the year to March against a contracted quantity of 5 mt because of transportation problems.
MRPL, a unit of government-owned Oil and Natural Gas Corp. Ltd (ONGC) and India’s largest importer of Iranian crude, could only bring in limited consignments for its refining operations due to its inability to arrange ships transporting Iranian crude oil, said P.P. Upadhya, managing director, MRPL.
Curbs imposed by the West on Iran for its suspected nuclear weapons programme have affected the offtake of crude from Iran, which has the world’s second largest oil and natural gas reserves. MRPL had contracted for 7.3 mt of Iranian crude oil last fiscal, of which it imported 6.2 mt.
The US and the European Union (EU) have been seeking to force Iran to abandon its nuclear programme, which they allege is aimed at making atomic weapons. Iran has defended itself, saying the programme is for peaceful purposes. The situation is expected to worsen after a fresh set of curbs kick in on 6 February. India is the world’s fourth largest oil importer and a major customer for Iran’s 1.7 million barrels per day of oil exports.
In another development, MRPL posted a loss of Rs.360 crore for the third quarter ended 31 December due to adverse foreign exchange fluctuations and inventory loss. It posted a net profit of Rs.110 crore in the same period last fiscal. Revenue rose to Rs.18,758 crore in the third quarter from Rs.13,647 crore a year ago.
Foreign exchange loss was Rs.257 crore in the reporting quarter, versus a foreign exchange loss of Rs.440 crore in the year-ago period.
Refinery margins also dropped significantly to $1.89 a barrel from $7.24 per barrel. Refinery margins are revenue earned from processing every barrel of crude oil.
“We hope this is a temporary phase of being in the red and hope to back in the black in the fourth quarter,” said Sudhir Vasudeva, chairman and managing director, ONGC.