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Essar Oil swings to profit

Essar Oil reported a profit of R105 crore against a loss of R166 crore in the same period last year as a stronger rupee resulted in a forex gain of R439 crore.

Essar Oil reported a profit of R105 crore against a loss of R166 crore in the same period last year as a stronger rupee resulted in a forex gain of R439 crore. The oil company?s net sales rose to R20,963 crore from R12,939 crore last year.

During the quarter, the company?s Vadinar refinery in Gujarat processed 5.07 million tonnes of crude, up 66% from last year. On January 17, the Supreme Court had rejected the company?s 125% sales tax deferment benefit claim on its investment in the Vadinar refinery project.

The tax benefit was an incentive by the Gujarat government for Essar to start production at the Vadinar refinery by August 15, 2003. Since the deadline was missed, the company had lost the right to defer the sales tax payment by 17 years.

The company said it revised its accounts for the year 2011-12, after receiving approval from the government to reopen and revise its accounts from the years 2008-2011. Essar Oil, which received approval from its lenders to exit of corporate debt restructuring loan facility earlier this year, reported current price gross refining margin of $7.86 per barrel, up 55% compared to $5.07 per barrel last year.

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First published on: 10-11-2012 at 03:16 IST
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