1.
Company Profile
Indian Oil Corporation Ltd (IOCL) is India's flagship national oil company
with business interests straddling the entire hydrocarbon value chain -
from refining, pipeline transportation and marketing of petroleum
products to exploration & production of crude oil & gas, marketing of
natural gas and petrochemicals. The company is the leading Indian
corporate in the Fortune 'Global 500' listing, ranked at the 168th
position for the year 2017. IOCL is a public sector undertaking.
Government of India held 56.98% stake in IOCL as on 31 December
2017.The company's operations include refineries, pipelines and
marketing. Their portfolio of brands includes Indane LPGas, SERVO
lubricants, XTRAPREMIUM petrol and XTRAMILE diesel and Propel
Petrochemicals. In exploration and production, Indian Oil's domestic
portfolio includes 11 oil and gas blocks and two coal bed methane
blocks while the overseas portfolio consists of 10 blocks spread across
Libya, Iran, Gabon, Nigeria, Timor-Leste, Yemen and Venezuela.
Indian Oil Corporation Ltd was established in the year 1959 as Indian Oil
Company Ltd. In the year 1964, Indian Refineries Ltd merged with
Indian Oil Corporation Ltd. Indian Oil Blending Ltd a wholly owned
subsidiary was merged with Indian Oil on May 2006. The company
transferred their entire equity holding in Indian Strategic Petroleum
Reserves Ltd (ISPRL) to the Oil Industry Development Board, a
government body functioning under the Ministry of Petroleum &
Natural Gas. Consequently, ISPRL ceased to be a wholly owned
subsidiary in May 2006.
The company formed one subsidiary company, namely IOC Middle East
FZE, in Jebel Ali Free Trade Zone Dubai, with the objective of marketing
lubricants and other petroleum products in Middle East, Africa and CIS
regions. In June 2006, they incorporated a joint venture company
namely, Indo-Cat Pvt Ltd with Intercat.Inc of USA for manufacture and
marketing of FCC catalysts and additives.In the year 2007, the company
received plenty of awards, Oil Industry Safety Directorate Awards,
'Most Admired Retailer of the Year' award, 'CIO 100 Award 2007', SAP
ACE - Awards for Customer Excellence and the only petroleum company
as 'The Most Trusted Brand' in ET's Brand Equity's annual survey. The
SERVO acquires prestigious MAN Global approvals, Indian Oil's R&D
Centre gets special recognition for Bioremediation and also SERVO
secures entry into NSF White Book - H1 Category during the period. The
company won Retailer of the Year - Rural Impact Award and their
XtraPower won Loyalty Summit Award during the year 2008.
In January 2008, the company and Hindustan Unilever Ltd (HUL) signed
an MoU for setting up Kwality Walls Kiosks at select Indian Oil petrol
stations across the country. Also, the company entered into an MoU
with Transparency International India (TII) for implementing an
Integrity Pact Programme focused on enhancing transparency in their
business transactions, contracts and procurement processes. In April
2008, the company launched 'LNG at Doorstep' facility at the Pen unit
of H&R Johnson, the facility, first of their kind in the country, which are
primarily aimed at catering to the needs of Liquefied Natural Gas (LNG)
customers who are not located on the main natural gas pipelines. The
company was conferred with the 'Maharatna' status by the
Government of India which provides enhanced autonomy and larger
flexibility for its operation.
During the year 2009-10, the company commissioned 238 new retail
outlets and 414 Kisan Seva Kendra (KSK) outlets taking their total tally
to 18,643. The company's Indane LPG brand earned the coveted status
of 'Superbrand'. On the lines of KSK, the Rajiv Gandhi Grameen LPG
Vitarak Yojana was launched to penetrate rural markets.During the
year, the company was granted the Petroleum Exploration License for
one of the two Type-S blocks in Cambay basin for which it is the
operator. Upon getting the license, exploration activities were initiated
in the block. The company was awarded a project for the development,
extraction, upgradation and marketing of heavy oil in Carabobo heavy
oil region of Venezuela in consortium with Repsol, Petronas, ONGC
Videsh Ltd. and Oil India Ltd.
During the year 2010-11, the company enrolled about 46.8 lakh new
Indane LPG customers and commissioned 245 new Indane distributors
taking their total to 618.3 lakh and 5,311 respectively. The LPG Bottling
capacity was enhanced to 5,518 TMTPA with capacity addition of 326
TMT. In order to provide LPG to rural India, the company commissioned
145 distributors under the Rajiv Gandhi Gramin LPG Vitaran Yojana
under the auspices of Ministry of Petroleum & Natural Gas. As a part of
their CSR activity, 10,052 new connections were released to BPL
families.
During the year, the company formed a joint venture company was
formed with Nuclear Power Corporation of India Ltd (NPCIL) for setting
up Nuclear power plants. In July 2010, the company commissioned
their first gas pipeline between Dadri and Panipat and thus they
commenced gas supplies to Panipat Refinery. The company in
consortium with GSPC, HPCL and BPCL won gas pipeline bids for
Mallavaram to Bhilwara and Vijaypur via Bhopal, Mehsana to Bhatinda
and Bhatinda to Jammu and Srinagar.
In 2012 Oil India Limited (OIL) and Indian Oil Corporation (IOCL) jointly
acquired a stake in Carrizo's liquid rich shale assets in the Niobrara
basin in Colorado, USA. Indian Oil (IOC) also launched a new engine oil
SERVO 4T SYNTH with advanced synthetic chemistry, for use by two-
wheelers. Petroleum & Natural Gas and Corporate Affairs launched
IOCL's Mobile Healthcare Scheme, a Corporate Social Responsibility
(CSR) initiative of IOCL. Indian Oil Corporation's (IOCL) Rural Mobile
Health Scheme (Sachal Swasthya Seva), launched as part of its
corporate social responsibility (CSR) agenda, was formally inaugurated
on all-India basis.In 2013 IOC planned for capacity expansion at
Doimukh depot and also IOCL inked MoU for Rs 5-k cr natural gas
terminal in Odisha
In 2014 IOCL conferred SCOPE Meritorious Award for CSR and
Responsiveness by the Hon'ble President of India. IOCL R&D also wins
National Awards for Technology Innovation -IOCL wins BML Munjal
Award for Business Excellence.In 2015 Indian Oil Corporation
commenced construction work on its proposed 4 MW solar power
project at Muttam village in the district. IOC also inked MoU with Nepal
Oil Corporation.
The Board of Directors of IOCL at its meeting held on 29 January 2015
approved the laying of Paradip-Hyderabad product pipeline at an
estimated cost of Rs 2789 crore. The board also approved construction
of 0.6 MMTPA LPG Import Facility at Paradip and augmentation of
Paradip-Haldia-Durgapur LPG pipeline.The Board of Directors of IOCL at
its meeting held on 13 February 2015 approved the setting up of
Ethylene Glycol Project alongwith associated facilities at Paradip at an
estimated project cost of Rs 3752 crore. The project would help in
consolidating the Glycol business of the company by producing low cost
Mono Ethylene Glycol based on FCC off gas. The board also approved
construction of dedicated Naphtha pipeline from Jaipur to Panipat
alongwith augmentation of Koyali-Sanganer product pipeline at an
estimated cost of Rs 890 crore. The pipeline would help in meeting the
Naphtha requirement of IOCL's Naphtha Cracker Complex at
Panipat.The board also approved implementation of project for 100%
BS-IV compliant MS and HSD production facilities at Gujarat refinery at
an estimated cost of Rs 1843 crore. The board also approved
implementation of project for 100% BS-IV compliant MS and HSD
production facilities at Barauni refinery at an estimated cost of Rs 1327
crore.
On 27 April 2015, IOCL announced that it has started the process of
commissioning its 15 MMTPA state-of-the-art Paradip refinery. On 24
November 2015, IOCL announced that the first consignment of
products from its Paradip refinery comprising of High Speed Diesel,
Superior Kerosene and Liquefied Petroleum Gas was dispatched on 22
November 2015.
The Board of Directors of IOCL at its meeting held on 13 August 2015
approved investment of Rs 1000 crore in Non-convertible Cumulative
Redeemable Preference Shares to be issued by Chennai Petroleum
Corporation Limited (subsidiary of IOCL) on private placement
preferential allotment basis.On 21 August 2015, Government of India
announced notice of Offer for Sale (OFS) of 24.27 crore equity shares of
IOCL aggregating to 10% of the total paid up equity share capital of the
company through the separate window provided by the stock
exchanges for this purpose. The floor price for the OFS was set at Rs
387.
On 31 December 2015, Indian Oil Corporation announced that it has
entered into a binding Gas Sale and Purchase Agreement (GSPA) with
Petronet LNG Limited (PLL) for procurement of an additional quantity of
0.3 MMTPA of RLNG with effect from January 2016. This is in addition
to the existing long term GSPA of 2.25 MMTPA, which was executed in
September 2003.The Board of Directors of IOCL at its meeting held on
29 August 2016 recommended issue of bonus shares in the ratio of
1:1.The Board of Directors of IOCL at its meeting held on 29 September
2016 accorded in-principle approval for expansion of the refining
capacity of Barauni, Bihar refinery from 6 MMTPA to 9 MMTPA
alongwith downstream Polypropylene unit at an estimated cost of Rs
8287 crore. The board also gave in-principle approval for
implementation of Olefin Recovery Project alongwith expansion of
existing Naphtha Cracker Unit, MEG revamp and Benzene Expansion
Unit modifications at Panipat at an estimated cost of Rs 1527 crore.
Indian Oil Corporation Limited (IOCL), Oil India Limited (OIL) and Bharat
PetroResources Limited (BPRL), through a joint venture company
formed by their wholly-owned subsidiaries in Singapore, completed
two transactions on 5 October 2016 viz., acquisition of 23.9% shares of
the charter capital of JSC Vankorneft, a company organised under the
laws of the Russian Federation, which is the owner of Vankor and North
Vankor Field licenses, from Rosneft Oil Company (Rosneft), a National
Oil Company of Russia, and acquisition of 29.9% of the participatory
share in the charter capital of LLC Taas Yuryakh Neftegazodobycha
(TYNGD), from LLC RN Razvedka I Dobychya, a wholly-owned subsidiary
of Rosneft.
The definitive agreements for the Vankor transaction were signed in
June 2016 and for the Taas transaction in March 2016. In JSC
Vankorneft, post-closing of transactions, Rosneft will hold about 61.1%
shares and ONGC Videsh Ltd (through its subsidiary) will hold the
remaining 15%. In TYNGD, post-closing of the transaction, Rosneft
(through subsidiary) will hold about 50.1% share and BP (through
subsidiary) will hold the remaining 20% share. Vankor field, located in
East Siberia is Russia's second largest field by production and accounts
for around 4% of Russian production. In 2015, the Vankor field
produced 22 million tonnes of oil and 8.71 BCM of gas. TYNGD is
expected to ramp up the production of crude oil to 5 million tonnes by
2021.
Indian Oil Corporation Ltd. (IOCL), NTPC Ltd., Coal India Ltd. (CIL),
Fertilizer Corporation of India Ltd. (FCIL) and Hindustan Fertilizer Corp.
Ltd. (HFCL) signed a Supplemental Joint Venture Agreement on 31
October 2016 for IOCL, FCIL and HFCL joining the Joint Venture
Company Hindustan Urvarak and Rasayan Ltd. (HURL), which had been
formed by NTPC and CIL for revival of the fertiliser plants at Gorakhpur,
Sindri and Barauni. Each of these plants will have 1.27 million tons per
year Urea production capacity. With the execution of the Supplemental
JVA, the equity participation of IOCL, NTPC and CIL in HURL will be
29.67% each (total 89.01%) and the balance 10.99% will be by FCIL
(7.33%) and HFCL (3.66%).
Indian Oil Corporation Ltd., Bharat Petroleum Corporation Ltd. and
Hindustan Petroleum Corporation Ltd. signed a Consortium Agreement
on 7 December 2016 to carry out pre-project activities for setting up of
West Coast Refinery and a Petrochemical Project of approximately 60
Million Metric Tonnes Per Annum (MMTPA) capacity in Maharashtra
through a Joint Venture Company.On 17 March 2016, IOCL announced
that it has signed an agreement with 3M India Ltd. for setting up 3M
auto care centres at IOCL's retail fuel outlets. The auto care centres will
be operated by the franchisees appointed by 3M India Ltd.
On 25 May 2017, IOCL announced that the company registered record
annual net profit of Rs 19106 crore for the financial year 2016-17 as
compared to a profit of Rs 11242 crore for the financial year 2015-
16.On 16 June 2017, IOCL announced that it has successfully rolled out
daily price revision of petrol and diesel across the country through its
network of 26,000-plus petrol pumps.
On 10 July 2017, IOCL and carbon recycling company LanzaTech signed
a Statement of Intent to construct the world's first refinery off gas-to-
bioethanol production facility in India.On 24 July 2017, IOCL announced
that it was ranked 168th in the Fortune 'Global 500' listing for 2017.
IOCL was the only Indian company in top 200 in the prestigious list.The
Board of Directors of IOCL at its meeting held on 3 August 2017
accorded first stage approval for the expansion of Gujarat refinery
capacity by 4.3 Million Metric Tonnes Per Annum (MMTPA) to 18
MMTPA at an estimated cost of Rs 15034 crore. The board also gave
first stage approval for installation of 2nd Catalytic De-waxing unit at
Haldia refinery at an estimated cost of Rs 1126 crore. The unit would
produce Grade-II & III Lube Oil base stock. The board also gave first
stage approval for installation of Ethanol Plant using Gas Fermentation
Technology of M/s. LanzaTech USA at Panipat refinery at an estimated
cost of Rs 441 crore. The board also approved acquisition of up to 50%
equity stake in GSPL LNG Ltd., which is setting up a 5-MMTPA LNG
Terminal at Mundra Port in Gujarat.On 19 August 2017, IOCL
announced that the contentious issue of VAT deferment on products
produced by the company's Paradip refinery in Odisha and sold in the
state has been resolved.
IOCL commenced production of gas and condensate from Dirok field in
Assam on 26 August 2017, marking advent of its first domestic
exploration asset maturing from exploration stage to a producing asset.
IOCL holds 29.03% participating interest in the block, located near
Digboi in Assam, along with Hindustan Oil Exploration Company (HOEC
26.88%, Operator) and Oil India Limited (OIL 44.08%, Licensee).On 19
November 2017, IOCL in collaboration with Ola launched the country's
first electric charging station at its fuel station at RBI Square, Nagpur.
2. Financial Performance of last
three years
A. Income statement
B. Cashflow
