Governemt-owned gas utility Gail India on Monday reported a 13% jump in net profit for the October-December 2011 period to R1,091 crore powered by growth in natural gas trading and higher sales in petrochemicals and liquefied petroleum gas (LPG).
?The third quarter growth in net profit was possible because of a 9% jump in natural gas transmission, 54% increase in petrochemicals sales and a 33% rise in LPG and liquid hydrocarbons business compared to the year ago period,? Gail India chairman BC Tripathi told reporters.
“Gas trading volumes were higher by 4-5 million standard cubic meters a day at 85 mmscmd,” Tripathi said. The net profit growth is after having paid R536 crore to oil retailers ? IOC, HPCL and BPCL ? to meet part of their losses from selling fuel below the import price in the third quarter. Gail’s turnover rose 35% to R11,260 crore in the third quarter.
The company is pinning hopes on greater consumption of imported regasified LNG by Indian customers in the petrochemicals, fertilisers and steel sectors for future growth as domestic gas output, mainly from Reliance Industries, has been falling. “We, as a country, have no other choice,” said Tripathi, suggesting that these sectors have to heavily depend on LNG for their feedstock and energy requirement for future expansion.
Gail, which already has a debt of R3,700 crore, will be borrowing another R5,000 crore next financial year to fund projects such as the 1500 km hydrocarbon pipeline between Surat and Paradeep, for which it recently won a contract.
