Transcript Presentation to the Press
Performance
2007-08
Press conference New Delhi, 28th May 2008
Covers…
Highlights
2007-08
Performance
Physical
Financial
Group companies
Open Forum
2
Highlights 2007-08
Indian Oil Group of Companies
Highlights 2007-08
Performance against odds
Turnover Rs. 2,47,479 crore
Profit After Tax : Rs. 6963 crore
Highest ever product sales
Highest Pipelines ever throughput of refineries and
Refineries surpassed 100% capacity utilization
Consolidated petrochemical business 4
Highlights 2007-08
Performance against odds
IBP Petroleum business integrated with IOC Marketing Division following its merger on 2 nd May 2007
SERVO lubricants exports grew by 56%; Footprints extended to Indonesia, Vietnam, Nigeria and Oman
Moved up 18 places to 135 in ‘Fortune Global 500’ listing in 2007
20 th largest petroleum company of the world 5
Performance Scaling new heights
Indian Oil Group of Companies
93.1% 38.5
Refining
Raising the bar 98.3% 100.1% 47.4
44.0
Capacity Utilization (%) Throughput (Million Tonnes) 2005-06 2006-07 2007-08 Highest-ever Throughput in 2007-08 7
Refining
Improving margins
Highest ever high sulphur crude oil processed against previous high of 43.7%
Processed 9.4% heavy crude oil against 3% in 2006-07.
- 48.8%
New facilities at Mundra Port for handling heavy crude oil and blending heavy and light grades
Sharing of feedstock & intermediates among group refineries for maximizing capacity utilization & value addition
Lowest energy consumption of 67 MBN* vis à-vis 71 MBN in 2006-07 *
An energy index defined as Mbtu/Bbl/NRGF
8
Throughput (Million Tonnes) 45.3
18.0
Pipelines
Underground highways 57.1
51.7
21.3
19.3
Products Crude Oil 32.4
35.8
27.3
2005-06 2006-07 2007-08 Highest-ever Throughput in 2007-08 Crude blending facilities commissioned at Mundra Port to improve refining margin 9
Marketing
Fuelling the economy Domestic Sales (Million Tonnes) 54.8
1.5
59.3
1.7
47.5
1.3
46.2
53.4
57.6
2005-06 2006-07 2007-08 Highest-ever Sales in 2007-08 Gas Products 10
Marketing
Reaching out, touching lives
Thrust on KSKs continued with commissioning of 727 KSKs out of 1187 ROs opened during 2007-08, taking their total number to 2050 out of 17642 ROs Enrolled 37 lakh new Indane customers, taking total strength to over 504 lakh Opened 4 new Aviation Fuel Stations, with their number reaching 101 352 Bulk consumer pumps added during 2007-08, their number growing to 7140 11
Marketing
Reaching out, touching lives
(Figures in brackets indicate % share in the Industry)
As on 1.4.2008
LPG Bottling Plants 89 (49.7%) Petrol/Diesel Outlets 17,642 (47.7%) Including 2050 KSKs Bulk Consumer Pumps 7,140 (88.3%) Terminals/Depots 166 (43.6%) SKO/LDO Dealerships 3,963 (63.7%) Aviation Fuel Stations 101 (67.3%) LPG Distributorships 4,996 (53.3%) Over 34,000 marketing touch points (55.5 % of Industry) 12
Marketing
Premium offerings
Branded fuels
XTRAPREMIUM and XTRAMILE registered growths of 89% and 65% respectively vis-a-vis previous year
XTRAPREMIUM
introduced in extending availability to 7071 ROs 2838 new outlets,
XTRAMILE introduced in 2245 new outlets, making it available in 10477 ROs ….maintaining leadership 13
Marketing
Premium offerings
Branded services
XTRAcare outlets – providing value added services, increased from 1052 to 1994
SERVOXPRESS launched as one stop shop for auto care services – from 3 in 2006-07 to 161 in 2007-08
XTRAPOWER Fleet Card : 13.8 lakh members , about Rs.
9,800 crore transaction IndianOil Citibank Co-branded members, Rs. 275 crore transaction Card: over 9 lakh 14
Marketing
Q & Q Assurance
Retail automation - completed in 1038 outlets
Real time stock update
Enhanced customer service through automatic billing and history of transactions Vehicle tracking System - completed for 14371 trucks
To ensure that quality product reaches the customer at retail outlets ….gaining customer confidence 15
R & D Commercializing in-house technologies
Obtained approval for 12 patents, including 1 from U.S. Total No. of patents obtained – 120, including 50 international patents 160 lubricant formulations commercialized and 46 approvals obtained from OEMs In-house developed Needle Coke (Niche product) technology licensed to Numaligarh Refineries Ltd.
Exploration & Production
Backward integration
Gas discovery made in Assam by consortium of IOC, OIL and HOEC. Commercial viability being established
Consortium of IOC-OIL-Sonatrach (Algeria) awarded 95/96 in Libya. EPSA signed on 25 th May 2008 Area
A Special Purpose Vehicle- Ind-OIL Overseas Ltd. formed between OIL and IOC and incorporated at Port Louis, Mauritius to undertake acquisition of overseas E&P assets 17
Domestic Overseas
Exploration & Production
Backward integration
NELP Rounds ( 8 blocks) CBM Rounds ( 2 blocks) Farm – in ( 1 block) Bidding
Farm-in
Yemen (2 blocks) Libya (3 blocks) Iran (1 block)
Gabon (1 block) Nigeria (1 block) 18
Petrochemicals
Adding to the bottom line
Revenue of over Rs. 2500 crore achieved through petrochemical sales Achieved 11.7% growth in LAB sales, including export of 28.97 TMT IOCLAB exports to nine countries, including to Pakistan and Philippines for the first time Maiden export of Thailand and Malaysia paraxylene to Indonesia, 19
Gas
Fuel of the future
Successfully innovation commissioned project the technology
“LNG at the Doorstep”
through customers cryogenic tankers for Industrial Achieved gas sales of 1.74 MMT in 2007-08 against 1.48 MMT in the previous year Signed an MoU with GAIL for incorporation of JV Company for city gas distribution in West Bengal In discussion with several companies for gas sourcing and city gas distribution 20
Green Agenda
Ethanol Blended Petrol (EBP)
5% EBP supply commenced in 5 additional states and 3 UTs during the year
With the above, EBP has been introduced in 14 states and 3 UTs Bio-diesel
Signed MoU with Chattisgarh Renewable Development Agency (CREDA) and Govt.
of Chattisgarh for formation of a JV to carry out activities related to crop plantation for production of Bio-diesel on commercial scale
2000 hectares of non-forest wasteland allotted to IOC in Jhabua district of MP for Jatropha plantation
Talks in progress with Rajasthan, Gujarat & Orissa Govts. for allocation of wasteland for undertaking bio diesel related activities 21
Globalization
Consolidating presence overseas
Lanka IOC Limited
Sales grew by over 8% during the year Market share maintained at 11.4% 18 TMTPA lube blending plant commissioned Trincomalee; 8 new lube distributors commissioned
State-of-the-art laboratory lubricants also commissioned for testing fuels at and
Launched bunkering business 22
Globalization
Consolidating presence overseas
IndianOil (Mauritius) Ltd.
Overall sales grew by 19.5% to 194.9 TKL vis-a-vis 163 TKL in 2006-07
Market share rose by 3.6% to 19.8% in 2007-08 Emerged as the leader in the highly competitive aviation business, with a market share of 35%
IndianOil Middle East FZE
A quantum jump in the sale of Base oils and lubricants recorded in only its 2 nd year of operation – sales grew to 12.65 TMT in 2007-08 as compared to 4.06 TMT in 2006 07 SERVO distributors appointed for Oman, Qatar and Bahrain 23
POL
Product
Petrochemicals LAB Paraxylene 2005-06 2.09
0.011
-
Exports
2006-07 3.13
Figures in MMT
2007-08 3.33
0.024
0.029
0.017
24
Capital Plan expenditure : 2007-08
Petrochemicals 2436 (49.8%) Other diversification 3,259 (7.5%) Refinery capacity addition, yield & quality improvement 1738 (35.6%) R&D 26 (0.5%) Marketing 44 (0.9%) Pipelines 423 (8.7%) Total: Rs 4,889 crore - over 100% achievement 25
Major Ongoing Projects
1 2 3 4 5 6 7 8 9 10 Project Paradip Refinery * Naphtha Cracker, Panipat Resid upgradation, Gujarat Once-through Hydrocracker & capacity augmentation, Haldia Panipat Refinery expansion: from 12 to 15 MMTPA & augmentation of crude oil pipeline Paradip-Haldia crude oil pipeline Dadri-Panipat R-LNG line Chennai-Bangalore product pipeline Koyali-Ratlam product pipeline Panipat-Jalandhar LPG pipeline Total Approved/ Estimated Cost (Rs. crore) 25,646* 14,439 5,693 2,869 1,213 1,178 251 232 225 187 51,933
* Approved in principle; ** 24 months from Environment & Forest clearance
Anticipated Completion End 2011-12 November 2009 January 2010 December 2009 December 2009 June 2008 January 2009 July 2009** October 2008 August 2008 26
Capital Plan Outlay – XI Plan
Investment for growth Petrochemicals 11,844 (27.3%) Other diversification 3,259 (7.5%) Refinery capacity addition, yield & quality improvement 25,400 (58.5%) R&D 300 (0.7%) Marketing 1,300 (3.0%) Pipelines 1,290 (3.0%) Total: Rs 43,394 crore Growth strategy is the key to success 27
Revisiting Corporate Vision
V2 Confluence (Vision with values)
IndianOil’s Vision statement drafted in 1999. The dynamic business environment has necessitated revisiting the Vision statement to reflect new goals, aspirations and core values
A unique re-visioning exercise launched within the Corporation, called V2 Confluence (Vision with Values), engaging employees for a Shared Vision 28
Care for Environment
Initiatives include
Green fuels Product quality improvement CDM projects Effluent treatment/ ecological park in refineries Tree plantation ….critical to sustainability 29
Corporate Social Responsibility
Substantive contributions being made to national causes, social welfare and community development programmes throughout the country
Community Development programme adopts a multi-faceted approach involving:
Health Family welfare Education Environment protection Drinking water and sanitation Empowerment of women National Heritage 0.75% of net profit of the preceding year is set aside for CSR 30
Performance (Financials)
Indian Oil Group of Companies
Rs. crore 2,20,779
Turnover
2,47,479 1,83,172 2005-06 2006-07 2007-08 32
Rs. crore
Net under realization
4,774 2005-06 9,774 2,190 2006-07 2007-08 33
Desired Price
vs
Actual Price
60 55 50 45 40 35 Petrol Rs/ltr 2004-05 2005-06 2006-07 2007-08 53 48 16.34
43 38 33 28 23 27.5.08
Diesel Rs/ltr 2004-05 2005-06 2006-07 2007-08 23.49
27.5.08
37 32 Kerosene Rs/ltr 27 22 17 12 7 2004-05 2005-06 Delhi prices 2006-07 2007-08 600 550 LPG-Domestic Rs/Cylinder 500 450 28.72
400 350 300 250 2004-05 2005-06 2006-07 27.5.08
2007-08 305.90
27.5.08
34
Profit After Tax
Rs crore 2005-06 2006-07 2007-08 4915 6963 35
Profit After Tax - Breakup
Loss before upstream sharing and GoI bonds Add upstream sharing Loss before bonds Add compensation in form of GoI bonds Profit Before Tax Less tax Profit After Tax 2007-08 (23240) 14323 (8917) 18997 10080 3117 6963 36
Contribution to Exchequer
Rs. crore 44,621 20172 24449 2005-06 56,164 27733 28431 2006-07 62,668 28419 States 34249 2007-08 Central 37
Subsidiary BRPL CPCL LIOC* IOML* IOC ME FZE* Rs crore
Financials Subsidiaries
Turnover 2006-07 2007-08 6,426 6,645 Profit After Tax 2006-07 2007-08 185 294 29,349 32,891 565 1,123 1,405 1,720 (29) 90 427 18 535 41 8 (0.22) 14 1.3
* In equivalent INR ( ) Indicates loss 38
Financials -
Major JV Companies Subsidiary Petronet LNG Avi-Oil India IndianOil Tanking Lubrizol IndianOil Petronas Greengas Turnover 2006-07 5,501 36 418 482 236 11 2007-08 6,555 25 836 511 1114 41 Profit After Tax 2006-07 313 3 21 14 13 (1) 2007-08 475 1 34 48 40 5 Rs crore ( ) Indicates loss 39
Towards sustainable & inclusive growth
Thrust on
Fuelling the economy Reaching the remote rural corners of India Biofuel and renewable initiatives Providing livelihood opportunities Protecting the environment CSR initiatives in Health, Eductaion, Women empowerment, Heritage protection, etc.
..…. for us, India first
40