Taj Mahal, which is protected by substituting the fuel of industrial furnaces in Agra and around byCNG supplied by GAIL

Maintaining fuel supply line to Kargil - IOC tankers convoy on hills

CONTENTS

1. Chapter I : Introduction 3

2. Chapter II : Exploration and Production 5

3. Chapter III : Refining 13

4. Chapter IV : Marketing and Distribution 20

5. Chapter V : Other Undertakings/Organisations 27

6. Chapter VI : Conservation of Petroleum Products 35

7. Chapter VII : Welfare of Scheduled Castes/ScheduledTribes, Other Backward Classes andPhysically Handicapped 37

8. Chapter VIII : Control of Pollution 39

9. Chapter IX : General 41

10. Appendices : 44

3

1.1 The Ministry of Petroleum andNatural Gas is concerned withexploration and production of oiland natural gas, and refining,distribution and marketing, import,export and conservation ofpetroleum products. The workallocated to the Ministry is givenin Appendix-I. The names of thePublic Sector Oil Undertakings andother organisations under theMinistry are listed in Appendix II.

1.2 Shri Ram Naik assumed thecharge as Minister of Petroleum &Natural Gas on 13.10.1999.

1.2.1 Shri E. Ponnuswamyassumed the charge as Minister ofState in the Ministry of Petroleum& Natural Gas on 13.10.1999.

1.2.2 Shri Santosh KumarGangwar assumed the charge asMinister of State in the Ministry ofPetroleum & Natural Gas on22.11.1999.

1.3 Shri S. Narayan assumed thecharge of Secretary, Petroleum &Natural Gas, on 20.10.1999. Priorto this, Shri T.S. Vijayaraghavanworked as Secretary, Petroleum &Natural Gas from 20.08.1998 to20.10.1999.

1.4 Shri C.L. Bashal, JointSecretary, continued to hold thecharge as Director of PublicGrievances in the Ministry.

PRINCIPAL ACHIEVEMENTS

1.5 The important statistical datarelating to the physicalperformance of the oil sector isgiven in Appendix III.

1.6 CRUDE PRODUCTION

Crude oil production in the countryduring 1998-99 was 32.722 MillionMetric Tonnes(MMT) against atarget of 34.01 MMT. Theproduction target for the year 1999-2000 is 33.04 MMT.

INTRODUCTION

CHAPTER I

1.7 Several measures were takenby the Government to intensifyexploration and enhancehydrocarbon reserves. Theseincluded development of new fields,additional development of existingfields, implementation ofEnhanced Oil Recovery Schemes,recourse to specialised technology,enlisting the services ofinternational experts andencouraging participation of privateand joint venture companies inthe exploration programme.

1.8 Under the New ExplorationLicensing Policy (NELP), 48 blockswere offered. By the bid closingdate of 18.8.1999, a total of 45bids for 27 blocks were receivedfrom both foreign and Indiancompanies including public sectorundertakings. Out of these, 25blocks have been awarded. Bidsfor 2 blocks were rejected, as theydid not satisfy the technicalrequirements.

1.9 COAL BED METHANE

The policy for exploration andexploitation of Coal Bed Methane(CBM) was approved byGovernment in July, 1997. CBMoperation in this country is beingundertaken for the first time andwill take some time before potentialof CBM at commercial level isknown. The terms and conditionsfor harnessing CBM requireconsultation with the StateGovernments. While West BengalGovernment has given theirconsent, Government of Bihar,Madhya Pradesh and Gujarat havenot consented so far. The policywill be implemented afterconsultations with StateGovernments are completed.

1.10 IMPORTS AND EXPORTS

The import of crude oil betweenApril - November, 1999 was 31.535MMT valued at Rs.19611 croreand of other petroleum products

4

9.514 MMT valued at Rs.7195crore. Exports upto November,1999 were of 0.531 MMT valued atRs. 372 crore.

1.11 REFINING

With the commissioning of newgrass root refineries at Numaligarhin Assam and Jamnagar in Gujaratand expansion of the existingrefineries, the refining capacity inthe country has increased to 109Million Metric Tonnes Per Annum(MMTPA) as on January 1, 2000from 69.14 MMTPA as on April 1,1999, a near self-sufficiency in therefining sector.

1.12 TOWARDS BETTERENVIRONMENT

To reduce vehicular emissions andto protect the environment, allrefineries in the country havecommenced production of lowsulphur (0.25%) diesel from1.10.1999 and retail outlets areselling only low sulphur diesel tothe consumers from January 2000and unleaded petrol from February2000.

1.13 SPECIAL SCHEME FORDEFENCE PERSONNEL KILLED INKARGIL ACTION

A Special Scheme of relief andrecompense has been formulatedfor the widows/dependents ofDefence personnel killed in actionin Kargil, under which 500 retailoutlets/LPG distributorshipscomplete in all respects will beallotted. These allotments are beingmade on the recommendations ofthe Ministry of Defence.

1.14 LPG SUPPLY TO RURALAREAS

A special scheme has beenapproved in July 1999 for releaseof new LPG connections in therural sector against surrender ofcorresponding kerosene quotathrough (i) Opening of extensioncounters in the rural areas fallingwithin 15 kms radius of the normaltrading area of the existingdistributors operating in the urbanareas and (ii) Award of interimLPG distributorships to the StateCivil Supplies Corporation of theconcerned State/some such Govt.bodies till a regular distributor isappointed.

1.15 LPG WAITING LIST

It is planned to release over 1crore new LPG connections duringthe calendar year 2000 to liquidatethe entire waiting list as of1.12.1999 by December 2000.

1.16 FACILITATION COUNTER ANDWEBSITE

The Information FacilitationCounter is in operation. In theyear 1999 over 3 thousand partiesavailed of this facility.

In addition to the above, Websitefor the Ministry of Petroleum andNatural Gas was formally launchedby the Minister of Petroleum andNatural Gas on January 27, 2000.So far, around 11,525 visitors haveavailed of website information. Thee-mail address of this Counter isfc.png@sb.nic.in. Messages havestarted pouring in through theInter-net also.

1.17 PLAN OUTLAY

The Revised Plan outlay of theMinistry of Petroleum & NaturalGas for the year 1999-2000 isRs.12469.43 crore and BudgetEstimate for the year 2000-2001Rs. 13461.13 crore. These outlayswill be met from the Internal andExtra Budgetary Resources of thePublic Sector Undertakings.

1.18 EARNING OF PUBLIC SECTORUNDERTAKINGS

The profit before tax and the profitafter tax made by the Public SectorUndertakings, under theadministrative control of theMinistry of Petroleum and NaturalGas, during the year 1998-99 wereabout Rs.11330 crore and Rs.8710crore respectively. The profit beforetax and the profit after tax,anticipated during 1999-2000, areabout Rs.11841 crore and Rs.9495crore. The profit before tax andafter tax, estimated to be generatedby this sector during 2000-2001will be about Rs. 12966 crore andRs. 10223 crore respectively.

1.19 CONSERVATION OFPETROLEUM PRODUCTS

Government has initiated measuresto conserve petroleum products.These include accent on fuelefficiency, training programmes inthe transport sector, modernisationof boilers, replacement of furnacesand equipment, standardisation ofirrigation pumpsets, rectificationof existing pumpsets, anddevelopment of fuel efficient stovesand appliances. These activitiesare the concern of the PetroleumConservation Research Association(PCRA) and of oil companies.

5

2.1 CRUDE OIL PRODUCTION2.1.1 ONGC and OIL the twoNational oil companies and a fewprivate and joint venture (JV)companies are engaged in theexploration and production of oiland natural gas in the country.Crude oil production during1998-99 was 32.722 MillionMetric Tonne (MMT) against thetarget of 34.01 MMT. ONGC andOIL had achieved itsMemorandum of Understanding(MoU) targets of crude oilproduction. The private/JVoperated fields had some shortfallin production. The crude oilproduction target during the year1999-2000 has been set at 33.04MMT.

2.1.2 Several measures weretaken to enhance hydrocarbonreserves and increase production.These include: -

i) Development of new fields andadditional development of theexisting fields.

ii) Implementation of EnhancedOil Recovery (EOR) Schemesand extension of someEOR Schemes from pilot scaleto full scale field application.

iii) Implementation of specializedtechnologies like extendedreach drilling, h o r i z o n t a land drain hole drilling.

iv) Obtaining the services ofinternational experts whereverconsidered necessary.

v) Maintenance of reservoirhealth through work-overoperations, pressuremaintenance methods.

vi) 3D seismic survey of the oldfields for better reservoirdelineation.

vii) Optimisation andredistribution of waterinjection.

EXPLORATION ANDPRODUCTION

CHAPTER II

viii) Infill drilling mostly in theunswept areas of thereservoirs.

2.1.3 One of the landmarks inliberalisation in petroleum sectoris encouragement of participationof foreign and Indian companies inthe exploration and developmentactivities to supplement the effortsof national oil companies to narrowdown the gap between supply anddemand. A number of contractshave been awarded to both foreignand Indian companies to undertakeexploration activities anddevelopment of fields on productionsharing basis.

2.2 STRATEGY OF IXTH PLAN

During the IXth Plan the mainthrust will be on the followingareas:-

(i) Optimisation of production ofcrude oil and natural gasfrom domestic basins andexisting fields specially theBombay High field.

(ii) An optimal mix of intensiveexploration (in producingareas) and extensiveexploration (in other areasincluding frontier areas anddeep waters) for increasingthe reserve base.

(iii) Emphasis on quality ofexploration by National OilCompanies for enhancedsuccess.

(iv) Steps for increasing recoveryfactors from major producingfields of national oilcompanies.

(v) Increased private participationthrough operationalisation ofNew Exploration LicensingPolicy (NELP)

(vi) Acquisition of equity oilabroad.

(vii) Exploration of Coal BedMethane.

6

2.3 ACQUISITION OF EQUITYOIL ABROAD

In view of the widening gapbetween demand and supply ofoil and gas, acquisition of equityoil from abroad is an importantplank of the strategy to achieveoil security. Government isencouraging oil sector PublicSector Undertakings (PSUs) toavail of overseas opportunitiesfor acquiring exploration acreageseither on their own or throughstrategic alliances/Joint Venture.ONGC-Videsh Ltd., a whollyowned subsidiary of ONGC, isactive in exploration anddevelopment activities of oil andgas in Vietnam, Middle East andCIS countries. The objective ofOVL is to acquire attractiveoverseas exploration acreages andproducing properties to increaseequity oil abroad. ONGC has agas project in Vietnam where ithas 45% participating interest inthe consortium comprising ofOVL, BP of U.K. and STAT OIL ofNorway. The gas reserves in theBlocks have been estimated tobe around 2 trillion cubic feet.OVL has recently finalised variousagreements in connection withits Vietnam project, and shortlya decision on the investmentplans for development of gasdiscovery would need to be taken.OVL has also been pursuingopportunities in Iraq, Iran, Russia(Udmurt, North Caspian Sea andAstrakhan) and evaluating otheropportunities.

OIL has also taken 20%participating interest in a Block inOman with TOTAL of France forexploration of oil and gas.

IOC has also submitted a proposalto the Ministry for acquiring 30%participating interest in Balal OilField for Development andProduction in Iran.

2.4 NEW EXPLORATIONLICENSING POLICY (NELP)

Government of India, in January,1999, had invited bids under theNew Exploration Licensing policy(NELP) with attractive fiscal termsand incentives. Under this policy,the upstream public sectorcompanies viz. ONGC and OILare to be provided level playingfield by giving them the samefiscal and contract terms as areavailable to private companies. Atotal of 48 blocks (10 onlandblocks, 26 shallow water blocksand 12 deep water blocks-beyond400 m iso-bath) were offered. Bythe bid closing date of 18.8.1999,a total of 45 bids for 27 blocks(4 onland blocks, 16 shallowwater blocks and 7 deepwaterblocks - beyond 400 m iso-bath)were received from both foreignand Indian companies includingpublic sector undertakings. Outof these, 25 blocks (2 onlandblocks, 16 shallow water blocksand 7 deep water blocks-beyond400 m iso-bath) have beenawarded. Bids for 2 blocks wererejected.

2.5 COAL BED METHANE (CBM)

The policy for exploration and

exploitation of CBM was approvedby Government in July, 1997.CBM operation in this country isbeing undertaken for the firsttime and will take some timebefore potential of CBM atcommercial level is known. Theterms and conditions forharnessing of CBM requireconsultation with the StateGovernments. While West BengalGovernment has given theirconsent, Government of Bihar,Madhya Pradesh and Gujarathave not consented so far. Thepolicy will be implemented afterconsultations with StateGovernments are completed.ONGC has undertaken R&Dprojects in West Bengal and Biharfor CBM operations. Ministry ofCoal is also undertaking R&Dproject in West Bengal with UNDPfunding.

2.6 OIL AND NATURAL GASCORPORATION LIMITED (ONGC)

Oil and Natural Gas CorporationLimited (ONGC) wasincorporated under theCompanies Act, 1956 on June23, 1993. The same wasincorporated pursuant to the

Sagar Sandhani Seismic Vessel of ONGC

7

decision of the Govt. to convertOi l and Natura l GasCommission into a publ iclimited company. An act ofParliament titled "Oil & NaturalGas Commission (Transfer ofUndertaking and Repeal) Act,1993" was passed on 4th Sept.,1993 prov id ing that theundertaking of the Commissionshall be transferred to andvested in the Corporation w.e.f.an appointed day to be notifiedby the Government through aseparate not i f i cat ion.Accordingly, w.e.f. Feb.1, 1994,the undertaking of the erstwhileOi l and Natura l GasCommission including all theassets , l iab i l i t i es , r ights ,obl igations, employees etc.stood transferred to and vestedin the Oil and Natural GasCorporation Limited. It isengaged in the exploration andexploitation of oil and naturalgas. ONGC Videsh Limited is awholly owned subsidiary of theCorporation. The authorisedand paid-up capital of ONGC ason 31.03.1999 were Rs.15,000crore and Rs.1425.92 crorerespectively.

2.6.1 New Hydrocarbon Finds

During 1999-2000 (upto Dec'99),focussed exploratory effortsresulted in two new hydrocarbonfinds, namely, Akholjuni (oil) inCambay Basin and Safrai (oil) inAssam Shelf.

Significant exploratory leadshave also been obtained inNorth Kadi , South Kadi ,Sobhasan, Gandhar & Jambusarin Cambay Basin; Kesanapalli,Kesanapalli West, Kuthalam, G-1 & Lakshmaneswaram inKr ishna Godavar i Bas in ;Periyapattinam, Kuttanallur &Kali in Cauvery Basin; Nambar& Geleki in Upper Assam andB-28A & D-31 in BombayOffshore Basin.

Hazira Processing Complex at Hazira of ONGC

2.6.2 Physical Performance during 1999-2000Parameter 1998-99 1999-2000 1999-2000 1999-2000

Actual Target (BE) Actual AnticipatedUpto (RE)

Dec.�99

Seismic SurveyOnland - 2D GLK 4369 5292 1829 4064

- 3D GLK 15418 11975 7041 12475Offshore - 2D+3D LK 94852 96750 64663 97400

DrillingExploratory Wells 129 151 92 178Development Wells 145 177 114 156Exploratory Metreage 287919 403570 253072 433530Development Metreage 299506 362880 228150 276400

ProductionCrude Oil (MMT) 26.385 25.800 18.801 25.257Natural Gas Sales(MMM3) 18413.17 18157.00 14057.321 18157.00Value Added Products(Thousand Tonnes) 3496.158 3116.00 2783.064 3116

2.6.3 Financial Performance during 1999-2000(Rs. Crore)

Parameter 1998-99 1999-2000 1999-2000 1999-2000Actual Target (BE) Actual Anticipated

Upto (RE)Dec.�99

Plan Outlay 4468 4800.00 3096.00 5395.00Total Income @ 15951.36 15119.89 15061 17962.89Net Profit 2754.50 2298.32 2769 3334.97

8

Uran after suitable processmodification.

❏ Under direct marketing of gas,contracts have been signedwith 13 consumers in WRBCand 9 in SRBC. Gas supplyhas been commenced to 11and 1 consumer in WRBCand SRBC respectively.

❏ Y2K compliance of allbusiness critical systems wasachieved by Nov'99.

❏ Inventory has been broughtdown to Rs. 1241 crore, lowestin the decade.

❏ ISO certification awarded toDiesel Shop, FabricationShop, BOP Repair & TM Shopof Central Workshop, Barodaand Institute of Engineeringand Ocean Technology (IEOT),Panvel.

❏ Adjudged as the BestUpstream Sector Company foroil conservation activities.

2.6.5 Progress of Projects

i) Gandhar DevelopmentPhase-IIThe project with ananticipated cost of Rs. 1442

crore is almost complete andproduction has commencedexcepting the commissioning.

ii) In-situ Combustion : SouthBalol Ph-II & North SanthalPh-IIThese EOR projects with ananticipated cost of Rs. 450crore are in final stages ofimplementation with someremaining modification workwhich is scheduled to becompleted by March'2000.

iii) B-55 DevelopmentCompleted jacket and deckinstallation and startedproduction on 23.11.99. Theanticipated cost of the projectis Rs. 411 Crore.

iv) Booster Compressor inBassein fieldThis project, for increasinggas compression facilities forenhanced supply, has beencompleted in May'99, 81/2months ahead of schedule.

vi) Additional Co-generationplant at UranThis project with an approvedcost of Rs. 117 crore wasinitiated by placing LOI to M/S BHEL on 23.7.98 andengineering work is inprogress. The completion isscheduled in July, 2000.

2.7 ONGC-VIDESH LIMITED

ONGC Videsh Limited (ONGC-VL),a wholly owned subsidiarycompany of Oil and Natural GasCorporation Ltd., is responsible forbringing equity oil from overseasby acquiring development acreagesor through exploration ventures.During 1998-99, as a first step, amatrix analysis was carried out toidentify the countries with surplusoil and can be considered as havinghigh potential for incremental oilproduction.ONGC-VL has identified

The corporation paid a dividend ofRs.784.26 crore for the year 1998-99 compared with Rs.356.48 crorefor the previous year.

2.6.4 Other Achievements❏ Under deepwater exploration

programme, the exploratorywell G-1-AA in KrishnaGodavari Offshore, drilled ata water depth of 267 mproduced oil and gas.

❏ A new gas field B-55 inWestern Offshore has beenput on production.

❏ Booster Compressor Platforms(BCP-A & BCP-B) project inBasin field has beencompleted 81/2 months aheadof schedule.

❏ Santhal Main and Balol MainIn-situ Combustion Projectsare in advanced stage ofcompletion and are expectedto be completed byMarch'2000.

❏ Out of total 25 milestones formajor projects under MOU1999-2000, 17 milestoneshave been achieved against16 due upto Dec'99.

❏ Naptha production started at

A Drill-ship of ONGC

9

Iraq, Iran, Russia, Kazakhstan,Azerbaizan and Algeria to be thefocus countries to bring largerquantity of equity oil. Othercountries would be considered ona case to case basis.

The major activities of the Companyfor the year 1999 are as under :

❏ Development phase ofVietnam Offshore Project hascommenced. Two MOU's for"Block 06.1 Gas andCondensate Sales" and "Govt.Guarantee and Approvals"have been signed. Gasproduction is likely tocommence by January, 2002.

❏ A bid for acquisition ofdevelopment field in Iraq wassubmitted in partnership withReliance Industries Ltd. whichis under evaluation by theMinistry of Oil, Iraq.Acquisition of an exploratoryBlock situated in southernIraq is also being pursued.

❏ Proposals for participation inexploration and developmentprojects in Russia are underevaluation.

❏ Opportunities have beenoffered by Kazakh side forparticipation in developmentof a discovered oil and gasfield.

❏ The available discovered fieldsand exploration blocks forparticipation in Iran wereshortlisted. A preliminaryproposal for development ofan offshore oil field in Iranwas submitted in partnershipwith Reliance Industries Ltd.

ONGC-VL earned a profit of Rs.738.42 lakhs during 1998-99, ascompared to Rs. 218.87 lakhs inthe previous year.

2.8 OIL INDIA LIMITED (OIL)

Oil India Pvt. Ltd. was incorporated

in 1959 as a Rupee company withtwo-thirds share of the BurmahOil Company (BOC)of U.K. andone-third of Govt. of India. Bysubsequent agreement in 1962,Government of India and BOCtransformed OIL to a Joint VentureCompany with equal partnership.The Government of India acquiredthe entire share capital of theCompany effective from October14, 1981 and since then OIL hasbeen functioning as a Public SectorCompany. It is engaged inexploration, production andtransportation of crude oil andnatural gas. The authorised andpaid-up capital of OIL as on31.03.1999 were Rs.250 crore andRs.142.67 crore respectively.

2.8.1 New Hydrocarbon Finds

During 1999-2000 (upto Dec'99),OIL's exploratory efforts led todiscovery of crude oil in theChabua structure near OIL'sDikom/Kathaloni structures inAssam. Reserves of crude oil wasalso established in the new faultblock in the Tamulikhat structure.A deep well drilled in the new

prospect around Digboi oilfield inPengri area and the exploratorywell drilled in the South Kathalonistructure, both in Assam, havegiven indication of presence ofhydrocarbons Production testingis in progress.

Onshore Drilling in progress in South Bankof River Brahmputra of OIL

2.8.2 Physical PerformanceParameter 1998-99 Target Achievement Ant.

Achievement 1999-2000 Upto 31/12/99 Achievement(99-00) during

1999-2000

Seismic Survey2D SLKM (Departmental) 1146.17 1500 496.30 15003D SQKM 170.32 150 87.42 1503D SQKM (Contractual) � 1502D GLKM 150.5 1150DrillingExploratoryMetreage ('000M) 44.571 57.00 22.350 45.00Well Nos. 12 14 7 12DevelopmentMetreage ('000M) 52.405 65.00 39.995 55.00Well Nos. 16 20 13 17Crude Oil Prd. (MMT) 3.294 3.30 2.477 3.30Natural Gas Sale 1130.751 1175 868 1175(MMSCM)LPG Production ('000T) 54.61 52.50 38.189 52.00

10

Inspection of OIL's Crude Oil Pipeline at a river crossing in Lower Assam

The company paid a dividend ofRs.78.47 crore for the year 1998-99 as against Rs.42.80 crore inthe previous year.

2.8.4 Other Achievements❏ OIL expects to bring down the

gas flaring to the lowest everlevel during the year.

❏ Drilling of first exploratorywell in Ganga Valley Basin inU.P. to the depth of 4816M was successfully completed,though there was nohydrocarbon discovery.

❏ For the first time, 2D seismicdata was acquired by Oil IndiaLimited across riverBrahmaputra covering alength of about 34 kms. incollaboration with NGRI.

2.8.5 Progress of Projects(i) OIL has planned to develop

Non-Associated Gas field in aphased manner for effectiveutilisation of gas resources inUpper Assam. Production fromfew of the wells have startedafter workover.

(ii) To meet the estimated shortsupply of crude oil toBongaigaon Refinery, reversepumping of the crude oil fromBarauni to BongaigaonRefinery through OIL'sexisting 14" dia. Bongaigaonto Barauni trunk pipeline hasbeen planned at an esimatedcost of Rs. 21.73 Crore. Fieldactivities have already started.

(iii) For RAPL's Gas CrackerProject, in Assam, OIL has acommitment to make available5.00 MMSCMD of gas forextraction of ethylene. OILhas received the final reporton cost estimate by M/S EIL.OIL has floated NIT for detailedengineering and turnkeyimplementation, however,contract will be finalised aftersigning of the Gas SupplyAgreement.

Oil Collecting Station at Duliajan of OIL

2.8.3 Financial Performance(Rs./Crore)

Parameter 1998-99 Target Achievement Ant.Achievement 1999-2000 Upto 31/12/99 Achievement

(99-00) during1999-2000

Plan Outlay 427.39 468.35 257 468.35Total Income 1469.39 1391.03 1280 1650Net Profit 291.60 229.19 196 215Internal Resource 160.53 581.05 233 276

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2.9 GAS AUTHORITY OF INDIALIMITED

2.9.1 Gas Authority of India Ltd.(GAIL), set up in 1984, is thelargest natural gas transmissionCompany in India. It has beenconferred the 'Navratna' status bythe Government. The Companyowns and operates a network ofover 4,000 kilometres of pipelines.This includes the prestigious HBJPipeline, a 2,702 kilometre longpipeline which runs from Haziraon the western coast of Indiathrough Vijaipur to Jagdishpur inNorth India having links to Delhiand over 1,300 kilometres ofregional pipelines in differentStates, including Maharashtra,Gujarat, Rajasthan, AndhraPradesh, Tamil Nadu, Pondicherry,Assam and Tripura. Theauthorised and paid-up capital ofthe company as on 31.03.1999were Rs.1000 crore and Rs.845.65crore, respectively.

2.9.2 The Company operates sixnatural gas processing plantshaving installed capacity toproduce 9,61,000 tonnes ofLiquified Petroleum Gas per year.

The LPG plant at Usar, Maharashtra, GAIL today produces more than 0.6 million tonnes perannum (MMTPA) of LPG at its six plants

These plants are located atVijaipur(2) in Madhya Pradesh,Vagodia in Gujarat, Usar in

Maharashtra, Lakwa in Assam andPata (Auraiya) in Uttar Pradesh. .Italso operates a petrochemicalcomplex at Pata.

2.9.3 PERFORMANCE AT A GLANCE

A. PHYSICAL

DESCRIPTION UNIT ACTUAL PROVISIONAL

1997-98 1998-99 1999-2000 (Upto Dec.'99)

Gas Sales MMSCMD 20,053 21,034 16,450

LPG/SBP/othersProduction ('000 MT) 634.97 709.02 601.22

PetrochemicalProduction ('000 MT) 0.016 0.248 70.67

B. FINANCIAL PERFORMANCE Rs. in crore

DESCRIPTION ACTUAL PROVISIONAL

1997-98 1998-99 1999-2000 (Upto Dec.'99)

Profit After Tax 1020 1060 659

Gross Internal 1269 1399 1019

C. DIVIDENDGAIL has paid enhanced dividendof Rs.295.98 crore for the year1998-99 against Rs.169.13 crorepaid for the previous year.

2.9.4 MAJOR PROJECTSCOMMISSIONED1. UP Petrochemical Complex :(UPPC) at Pata in Uttar Pradeshwas commissioned in March, 1999at a cost of Rs.2404 crore with adesign capacity of 3 lac tonnes ofethylene to produce 2.6 lac tonnesof High Density Poly Ethylene(HDPE) and Linear Low DensityPoly Ethylene (LLDPE).

2. LPG Project at Pata (Auraiya) inUttar Pradesh was commissionedin November, 1999 at a cost of Rs.439 crore to process 12 MMSCMDof gas to produce 2,58,250 tonnesof LPG and 71,085 tonnes ofPropane per year.

2.9.5 ONGOING PROJECTS

Liquefied Petroleum GasPipelines: The Company hasundertaken the construction of a1,250 kilometre long pipeline totransport liquified petroleum gas

12

from Kandla and Jamnagar inWestern India to Loni in NorthernIndia. The pipeline is to have acapacity of 1.7 million tonnes ofliquefied petroleum gas per year(subsequently to be increased to2.5 Million Tonnes Per Annum(MMTPA)) and is scheduled forcommissioning in early 2001.

LIGHT END FRACTIONATE OVERHEADLEF O/H Project at Vijaipur isbeing executed at an estimatedcost of Rs.94 crore with aprocessing capacity of 2.12MMSCMD of gas.Gas Processing Complex atGandhar is being set up at anestimated cost of Rs.361 crorewith a capacity of gas processingof 5 MMSCMD to produce Pentane17406 TPA and SBP 25543 TPA.

2.9.6 FUTURE PLANSThe Company is examining thefeasibility of constructing twoliquefied petroleum gas pipelinesin Southern India one from Vizagto Secunderabad in AndhraPradesh (600 Km) and other fromMangalore to Madurai (700 Km..Approx.) in the States of Karnatakaand Tamil Nadu.Liquified Natural Gas (LNG)Terminals: GAIL is a partner ofPetronet LNG Ltd., a Joint Ventureformed to import Liquified NaturalGas at Dahej(Gujarat) andKochi(Kerala). In addition, the

Fire station at the Uttar Pradesh Petrochemical Complex, Pata of GAIL

In addition to the Company'snatural gas transmission pipelines,liquified petroleum gasmanufacturing facilities andpetrochemical complex, theCompany has entered into jointventures to supply and marketnatural gas to retail consumers.The Company has formed a jointventure with British Gas Plc. topromote the distribution andmarketing of natural gas in greaterMumbai and has formed a jointventure with BPCL to promote thedistribution and marketing ofnatural gas in Delhi.

Company has also entered into aJoint Co-operation Agreement withTata Electric Companies andTotalfina under which theCompany is to have a one-thirdinterest in the Liquified NaturalGas terminal to be established atTrombay.

Expansion of the Pipeline Network:The Company is also consideringa further expansion of the capacityof its pipelines to handle theadditional requirement of gasthrough imports and increasedproduction in the country.

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3.1 REFINING CAPACITY ANDTHROUGHPUT

3.1.1 The refining capacity of 69.14Million Metric Tonnes Per Annumas on 1.4.1999 has increased to109.04 Million Metric Tonnes PerAnnum (MMPTA) as on January 1,2000, making the country almostself-sufficient in the refining sector.

3.1.2 There are 17 refineries inthe country, of which 7 are ownedby Indian Oil Corporation Limited(IOCL), two each by HindustanPetroleum Corporation Limited(HPCL) and Madras RefineriesLimited (MRL), one each by BharatPetroleum Corporation Limited(BPCL), Cochin Refineries Limited(CRL), Bongaigoan Refinery &Petrochemicals Limited (BRPL),Numaligarh Refinereis Limited(NRL), Mangalore Refinery &Petrochemicals Limited (MRPL) andReliance Petroleum Limited (RPL).

3.1.3 Keeping in view the need ofenhancing the refining capacity tomeet the growing demand ofpetroleum products, a number ofgrass root refineries as well asexpansion of existing refinerieshave been commissioned and someare under various stages ofimplementation. As per the currentoutlook, the refining capacity isexpected to go upto 129 MillionMetric Tonnes Per Annum by theend of IX th Plan as against theestimated demand of products of110 Million Metric Tonnes.

3.2 IMPORT OF CRUDE OIL ANDPETROLEUM PRODUCTS DURING1999-2000.

GROSS IMPORTS

Crude Oil : In the year 1998-99,about 39.808 MMT of crude oilwas imported valued at Rs.14876crore. Import of crude uptoNovember 1999, was 31.535 MMTvalued at Rs.19611 crore.

Petroleum Products : During1998-99, 18.78 MMT of productswas imported at a cost of Rs.9837crore. During the current yearupto November,1999 the import ofpetroleum products was 9.514MMT valued at Rs.7195 crore.

3.2.1 EXPORTS

During 1998-99, the export ofpetroleum products(includingsupplies to Nepal) was 1.401 MMTfor a value of Rs.856 crore. Theexport of petroleum productsduring April-November,1999 was0.531 MMT valued at Rs.372 crore.

3.3 CRUDE OIL AND PRODUCTPRICING

3.3.1 The administered pricingmechanism (APM) which was invogue in the petroleum sector sincethe mid 70's provided returns tothe oil companies based on apredetermined percentage. Whilethe APM ensured price stability, itdid not encourage costminimisation, efficient use ofcapital, customer friendlycompetitive environment etc.Subsidies/cross subsidies resultedin wide distortions in consumerprices resulting in inefficient usageof scarce products. Further, APMwas less transparent and thereforeinvestors were reluctant to commitlarge funds in petroleum sector.Infrequent revision in productprices in line with internationaldevelopments resulted inaccumulation of a large deficit inthe Oil Pool Account in the lastfew years.

Hence, it was considered necessaryto move towards a market drivenprice mechanism in a phasedmanner.

3.3.2 Phased Dismantling of APM

Based on the recommendation ofthe 'R' Group and the ExpertTechnical Group (ETG), the

REFINING

CHAPTER III

14

Government in November, 1997approved the time table for phaseddismantling of APM over a periodof four years. The transitioncommenced on 1.4.1998. Thestatus of the progress up to thefinancial year 1999-2000 is givenas under:a) The Cost-plus formula for

indigenous crude oilproduction by the national oilcompanies (NOC) has beenabolished and percentage ofweighted average FOB priceof actual imports are paid,subject to floor and ceilingrates.

(b) Refining sector has beendelicensed effective 8.6.1998.

(c) The APM has been abolishedfor existing and new refineries.The refinery gate prices ofcontrolled products i.e., Petrol,NGL, Diesel, Aviation TurbineFuel, LPG and Kerosene arebeing fixed on import paritybasis.

(d) Prices of all other petroleumproducts have beendecontrolled and are now fixedby the oil companies at marketrates.

(e) The consumer price of LPG(Domestic) at ex-storage pointhas been increased by Rs.14/cylinder exclusive of duty,sales tax and other local levieseffective midnight of 31stJanuary/Ist February' 1999.A further 33% of the subsidyon LPG (Domestic) is also duefor passing on in the pricesduring this financial year, onwhich action is yet to betaken.

(f) The consumer prices of dieselare being fixed on the principleof import parity. During theperiod Nov.�97-Oct.'99, ex-storage point of HSD hasbeen revised nine times. Six

revisions were decreases andthree were increases. SinceApril, 1999 the ex-storagepoint prices of diesel havebeen revised on two occasionsi.e. on 20.4.1999 and6.10.1999.

g) Cost plus formula for shippingof crude oil has been doneaway with.

h) As a part of tariff restructuringexercise, the customs duty oncrude oil has been reducedfrom 27% to 22% effective2.6.1998. Further, crude/product duties have beenreduced by 2% in the UnionBudget for 1999-2000.

i) Private and Joint Sectorrefineries have been permit

amount ofRs.385 crore of principalamount and an interestelement of Rs.900 crore onlyremains to be serviced.

3.3.3 The process of deregulationand liberalisation will be continuedduring the transition period infurther rationalisation in tariffs toprovide effective tariff protectionto the refineries, reduction intransport subsidies/subsidies forkerosene (PDS) and LPG (Domestic)in a phased manner and theliberalisation of the EXIM Policy toreflect the process of reforms.3.4 NUMALIGARH REFINERYLIMITED (NRL)3.4.1 Numaligarh Refinery is beingset up as a grass-root Refinery of3 MMTPA capacity at Numaligarh

Night View of Numaligarh Refinery

15

were also expanded to 1.4 MMTPA.The authorised capital and paid-up capital of the company as on31.3.1999 were Rs. 75 crore andRs. 68.94 crore respectively.

3.5.2 PHYSICAL PERFORMANCEDuring the year 1998-99,theRefinery processed 7.77 MMT ofcrude oil. The capacity utilisationwas 103.6 and this was theeleventh consecutive year whenthe Refinery achieved capacityutilisation of over 100%. CRL alsoset a record in crude throughput,production and sales of LiquefiedPetroleum Gas, Toluene, AviationTurbine Fuel, Bitumen, etc. Theanticipated crude oil throughputfor 1999-2000 is 7.8 MMT. Crudeoil processed from April-December,1999 was 5.89 MMT.

3.5.3 FINANCIAL PERFORMANCE

Turnover and Profits

The Company achieved a turnoverof Rs.4,171 crore during the year1998-99 as compared to Rs.4374crore during 1997-98. The drop ofRs.203 crore in turnover is due todepressed international oil prices

CDU/VDV of NRL

in the District of Golaghat (Assam)in fulfilment of "Assam Accord" ofAugust 15, 1985, for providing therequired thrust towards industrialand economic development ofAssam. The project is beingexecuted by a new company,namely, Numaligarh RefineryLimited (NRL) incorporated on April22, 1993. Bharat PetroleumCorporation Limited , IBP Co.Limited and the Government ofAssam have equity participation of32%, 19% and 10% respectively.The balance 39% will be offered topublic. The approved cost of theproject together with a MarketingTerminal is Rs. 2724 crore.3.4.2 The commissioning processof the refinery commenced in April1999. Once fully commissioned,the refinery will produce annually84 TMT of LPG, 510 TMT ofNaphtha, 85 TMT of ATF, 1102TMT of kerosene, 1095 TMT ofdiesel, 71 TMT of petroleum cokeand 4 TMT of sulphur. TheMarketing Terminal would also beready for operation insynchronisation of the refinerycommissioning.

3.5 COCHIN REFINERIESLIMITED (CRL)

3.5.1 The Refinery's initialinstalled capacity inSeptember,1966 was 2.5 MMTPA.It was raised to 3.3 MMTPA in1973 to 4.5 MMTPA in 1984 andto 7.5 MMTPA in December,1994.The secondary processing facilities

Lush green : Cochin Refineries waste water treatment plant with the refinery at the backdrop

16

conversion of 1,84,000 TPA ofNaphtha to HSD, increase incrude throughput by 40,000TPA and saving of 6,300 TPAof Fuel Oil. The project costingabout Rs. 64 crore is targetedfor completion by October,2000.

3.6 MADRAS REFINERIESLIMITED (MRL)

3.6.1 Madras Refineries Limited(MRL) was formed as a jointventure of the Government of India(GOI), Amoco India Inc. U.S.A. andNational Iranian Oil Company(NIOC), Iran with the initial equitycontribution in the ratio of74:13:13. The company wasincorporated on 30.12.1965 as aPublic Limited Company.

3.6.2 MRL's refinery was originallydesigned for processing 2.5 MMTPAof imported crude from Iransupplied by NIOC. The refinerywas commissioned in the year1969. The capacity of the refinerywas increased from 2.5 MMTPA to2.8 MMTPA in 1980, to 5.6 MMTPAin 1984-85 at a cost of Rs.170crore and further to 6.5 MMTPA inMarch, 1993. MRL's Cauvery BasinRefinery at Nagapattinam wascommissioned in 1993, thusincreasing the total refiningcapacity to 7.0 MMTPA. AmocoIndia Inc. disinvested its equityholding in favour of GOI in 1985.After MRL's successful premiumequity issue in 1994, the Govt. ofIndia continues to remain as amajor shareholder of the Company.The authorised capital and paidup capital of the company as onMarch 31, 1999, were Rs. 200crore and Rs. 147.10 crorerespectively.

3.6.3 PERFORMANCE AT AGLANCE

Physical

During the year 1998-99, the total

New computerised truck loading facility in Cochin Refineries

during 1998-99. The Profit AfterTax for the year rose to Rs.338.23crore from Rs.220.41 crore of theprevious year. The companydeclared a dividend of Rs. 24.82crore compared with Rs. 22.06crore for the previous year.

3.5.4 SAFETY & ENVIRONMEN-TAL PROTECTIONThe company continued to bevigilant in making the Refinery asafe place for its employees andhas invested substantially inautomated safety and processcontrol systems. It fulfills all theenvironmental standards laid downby Kerala State Pollution ControlBoard and Central PollutionControl Board with respect toeffluents and gaseous emissions.

3.5.5 MOU TARGETSCRL achieved an "EXCELLENT'rating under the MOU parameteresfor the eighth consecutive year.

3.5.6 PROJECT UNDER IMPLE-MENTATION(i) Diesel Hydro Desulphuri-

sation ProjectThe Rs. 852 crore Diesel

Hydro DesulphurisationProject (DHDS) aims atreducing the Sulphur contentin diesel to 0.25% from 1%by weight, is being executedthrough Lump Sum Turnkey(LSTK) package withEngineers India Limited asthe Project ManagementConsultant. The project istargeted for completion byDecember 1999 and theproduct will be out byFebruary 2000.

(ii) Stand Along Water SupplyProjectThe project is for setting up of anindependent water supplyscheme to meet CRL's waterrequirements. The projectenvisages drawing of 16.5-MGDwater from Periyar river. Theproject estimated to cost Rs. 95crore is expected to be completedin September, 2000.

(iii) Enhancement of LPGRecoveryThe project envisagesenhancing LPG recovery fromthe crude unit by 20,000Tonnes Per Annum (TPA),

17

crude processed was 6.75 MMT asagainst 7.52 MMT during theprevious year.FinancialThe company earned a net profitof Rs. 205 crore during 1998-99compared with Rs. 129 crore inthe previous year, and declared adividend of Rs. 51.48 crore for theyear compared with Rs. 39.70 crorefor 1997-98.3.6.4 MAJOR PROJECTS COM-PLETED DURING THE YEARThe following projects have beencompleted:1. ADDITIONAL WET SLOP

TANK WITH ALLIEDFACILITIES

2. STACK HEIGHT INCREASEOF HEATERS

3. INSITU STACK MONITORS4. LUBE VACUUM COLUMN

REVAMP5. GREEN BELT DEVELOPMENT3.6.5 PROJECT UNDER IMPLE-MENTATIONDiesel Hydro DesulphurisationProject : The Hydro-desulphuri-

sation of Diesel (DHDS) project toreduce sulphur to 0.25% in dieselis being put up at a cost of aboutRs.766 crore. The project hasbeen mechanically completed.Commissioning activities are inprogress.3.6.6 FUTURE PROJECTSi) 3.0 MMTPA Expansion at

ManaliMRL has obtained the PIBapproval from theGovernment of India forexpanding its ref iningcapacity at Manali by 3.0MMTPA, at an estimatedinvestment of Rs.2360.38crore. The proposal is nowbefore Cabinet Committee onEconomic Affairs for finalinvestment approval.Technology Selection for thevarious process units is inan advanced stage ofcompletion. No ObjectionCertificate has been obtainedfrom the TamilnaduPollution Control Board forthe project. Detailedappraisal of the project hasbeen completed by ICICI,IDBI and IFCI.

ii) Power ProjectMRL has obtained the FirstStage approval of the Govt. ofIndia for the preparation of aDetailed Feasibility Report(DFR) and other alliedactivities for the Joint VenturePower Project based onrefinery residue to be locatednear the Manali Refinery. Theestimated project cost isRs.1600 crore.

MRL has obtained theapproval of Govt. of India forthe selection of theConsortium of PSEG GlobalInc., USA and Larson &Toubro as Joint venturepartners for the project. Thisconsortium and MRL will hold26% equity stake each in theproject and the distributionof balance 48% equity wouldbe determined in consultationwith the consortium. M/sTamilnadu IndustrialDevelopment CorporationLimited (TIDCO) and M/sTamilnadu Electricity Board(TNEB) have also expressedtheir interest in taking aequity stake in this project.

A view of reformer, PSA of Hydrogen Unit and furnace of DHDS Unit of DHDS Projectof MRL

Golden Peacock Environment ManagementAward for the year 1998-99 awarded toMRL

18

The True Boiling Plant (TBP) Distillation Unitat MRL's R&D Centre

iii) Capacity Expansion atCauvery Basin Refinery(CBR)A project to expand theexisting capacity of 0.5 MTper annum to 1.0 MT perannum at Cauvery BasinRefinery at Nagapattinam atan estimated cost of Rs.30crore has been taken upduring the current year 1999-2000.

iv) Jetty ProjectIn order to augument therequired quantity of crude atCauvery Basin Refinery atNagapattinam, MRL isplanning to set up apermanent Jetty facility at anestimated cost of Rs. 96 crore.Necessary Oceanographicstudies/surveys like Bathy-metiric, Wave Motion, EIA,Sea Bed Survey, Marine Geo-tech studies, Pipeline routesurvey etc. have been carriedout. The project is expectedto be commissioned duringthe fourth quarter of 2000.The facilities are expected to

meet the Crude oilrequirements of the CauveryBasin Refinery Unit in thenear future and also help theexport of Petroleum productsin the long term by otherPetroleum Companies.

3.7 BONGAIGAON REFINERY &PETROCHEMICALS LTD. (BRPL)3.7.1 IntroductionBRPL was incorporated onFebruary 20, 1974, to install aRefinery of 1 MMTPA and aPetrochemical Complex consistingof Xylene, Dimethyl Terephthalate(DMT) and Polyester Staple Fibre(P.S.F) Units. The crude processingcapacity of the Refinery was

enhanced to 2.35 MTPA in1995-96.The authorised equity capital ofthe company is Rs.200 crore. Thepaid up capital as on date isRs.199.82 crore. Government ofIndia has so far disinvested 25.54%of the issued capital.While the POL products from theRefinery are marketed by IndianOil Corporation, the Petrochemicalproducts and petroleum coke aremarketed by BRPL itself.3.7.2 Physical PerformanceThe Performance highlight of theRefinery as well as Petrochemicalunits for the years 1998-99 and1999-2000 has been as follows:

Item 1998-99 1999-2000

Actuals till 1999-2000Dec'99 (Anticipated)

a) Crude throughput(MMT) 1.65 1.34 1.90

b) Production ofMajor PetrochemicalProducts(MT)�Paraxylene 17,975 12,400 18,400�Ortho xylene 1,038 1,200 2,500�DMT 26,893 19,000 26,000�PSF 14,824 14,000 20,300

The lower processing of crudevis-a-vis capacity of 2.35 MMTPAduring the recent years isprimarily due to lower crudeavailability from North East fields.The company has embarked upona project alongwith M/s. IndianOil Corporation Limited and OilIndia Limited to transportimported crude oil from Haldia toBongaigaon, Assam to maximisethe plant capacity utilisation.Production of petrochemicals islower due to depressedmarkets.

3.7.3 Financial Performance

BRPL earned a net profit of Rs.34.26 crore for the year 1998-99and declared a dividend of Rs.10.28 crore compared with Rs.67.98 crore and Rs. 20.4 crore forthe previous year.

3.8 JOINT VENTURE PROJECTS

Public sector companies have beenallowed to set up refineries in jointventure with 26% equityparticipation. The status of JVrefineries, under implementation,

19

is as follows:

i) Bharat Oman RefineryLimited

The proposal of BPCL to setup 6.0 MMTPA refinery atBina in Madhya Pradesh asa Joint Venture with OmanOil Company at an estimatedcost of Rs.5277 crore wasapproved by Government inDecember, 1995. Constructionof the refinery is held up dueto non-receipt of certainenvironmental clearances fromthe Government of Gujarat.

ii) Eastern India RefineryThe proposal to set up a 9

MMTPA grass root refineryat Abhayachandrapur,Orissa, at an estimated costof Rs.8270 crore throughJoint Venture Companybetween IOCL & KuwaitPetroleum Corporation wasapproved by government inJuly 1998. ProjectManagement Consultant hasbeen appointed. Landacquisition is expected to becompleted shortly.

iii) Punjab Refinery ProjectPunjab Refinery Project is a9.0 MMTPA capacity beingset up by HPCL atPhulokhari, District

Bhatinda, in the State ofPunjab. The Project approvedby the Government inNovember 1998, at anestimated cost of Rs.9806crore is expected to becompleted within 48 monthsafter firming up of the JointVenture Partner for theProject, and receipt ofenvironmental approval forCrude Oil Terminal andCrude Oil Pipeline.Subsequent to withdrawal byM/s. Exxon from the Project,HPCL has been looking forsuitable partners from theIndustry to participate inthe execution of the Project.

20

4.1 LPG MARKETING BY PUBLICSECTOR OIL COMPANIES

4.1.1 Four Public Sector OilCompanies, namely, Indian OilCorporation, Bharat PetroleumCorporation, Hindustan PetroleumCorporation and IBP Co. Ltd. areengaged in the marketing of LPGin the country. With the increasedavailability of LPG, the number ofLPG customers enrolled by themhas also been increasing. Thenumber of LPG customers servedby them as on 1.1.2000 was 436lakh. The Government approvedthe release of 70 lakh new LPGconnections and 40 lakh DBCs bythe PSUs during the financial year1999-2000. Against this, theyhave already released 55 lakh newLPG connections and 29 lakh DBCsduring April-December, 1999.

4.1.2 The Government have alsobeen according priority in releaseof LPG connections to theecologically fragile hilly areas andTaj Trapezium to reducedeforestation in the hilly areas.All waiting list in the hilly areas (above 2000 ft.) of the entire Statesof Jammu and Kashmir, HimachalPradesh, hilly areas of UttarPradesh, Union Territories andDelhi have been cleared.Substantial waiting list in theentire North East has also beencleared by the PSUs. TheGovernment have also taken adecision to clear the entire waitinglist of LPG in the metro-cities ofCalcutta, Chennai, Mumbai andNational Capital Region. It isplanned to clear all waiting list ason 1st December, 1999 byDecember'2000 by releasing 1 crorenew LPG connections during 2000.

With the increasing non-availabilityof traditional fuels and LPG beinga convenient/safe cooking fuel,the Government has decided to

commence marketing of LPG inthe rural areas.

Further, with a view to penetrateinto the rural areas, MOP&NG hasapproved a special scheme inJuly'99 for release of new LPGconnections in the rural sectoragainst surrender of correspondingkerosene quota through -

i) Opening of extension countersin the rural areas fallingwithin 15 kms radius of thenormal trading area of theexisting distributors operatingin the urban areas.

ii) Award of interim LPGdistributorships to the StateCivil Supplies Corporation ofthe concerned State/somesuch Govt. bodies till a regulardistributor is approved.

Under the SKO surrender scheme,the State Govt. of Andhra Pradeshhas availed release of additional10 lakh LPG connections during1999-2000 to the people below thepoverty line against surrender ofcorresponding kerosene quota.The Government have alsoallocated an additional 8 lakh and1 lakh LPG connections to theState of Maharashtra andRajasthan against surrender ofKerosene.

4.2 PARALLEL MARKETING OFLPG AND SKOIn order to increase the availabilityof LPG and Kerosene, the PrivateSector was allowed to participateat the schemes of parallelmarketing of LPG and Kerosene inApril'93 by decanalising theirimports. Under the scheme aprivate party can undertake theimport of LPG and Kerosene afterobtaining a rating certificate fromone of the approved rating agenciesgiven in the LPG (Regulation ofsupply and Distribution) Order,

MARKETING ANDDISTRIBUTION

CHAPTER IV

21

1993 and kerosene (Restriction onuse of Fixation of ceiling price)Order, 1993 as amended from timeto time. These products are to besold at market determined pricesby the private parties throughtheir own distribution network.Initially, the Public Sector OilCompanies facilitated the importof LPG and Kerosene through theirfacilities. Up to 1.1.2000, 5615.4TMT of Kerosene and 695.1 TMTof LPG have been imported by thePrivate Sector under the scheme.

4.3 BHARAT PETROLEUMCORPORATION LIMITED (BPCL)4.3.1 BPCL is an integrated oilCompany in the downstream sectorengaged in refining of crude oiland marketing of petroleumproducts. It has also diversifiedinto the manufacture andmarketing of petrochemicalfeedstocks. The Corporation hasan all India presence through itsextensive marketing network. Theauthorised and paid-up sharecapital of the Corporation as on31.3.1999 were Rs. 200 crore andRs. 150 crore respectively. TheGovt. of India holding in BPCL is66.2%. It is one of the Navratnacompanies.

4.3.2 During the year 1998-99,BPCL Refinery achieved athroughput 8.94 MMT comparedwith 7.94 MMT in 1997-98. Thethroughput achieved uptoDecember 1999 has been 5.69MMT. The total sale of petroleumproducts during 1998-99 was17.50 MMT as against 16.37 MMTin 1997-98. The sale volumeachieved upto December 1999 hasbeen 13.8 MMT.

The sales turnover in 1998-99increased to Rs. 25,650 crore fromRs. 20,697 crore in the previousyears and the profit after tax Rs.701 crore from Rs. 533 crore. The

Refuelling by BPC at Mumbai Airport

BPC's attractive Lube Shoppe

Corporation declared a dividend ofRs. 187.5 crore equivalent to 125%of the paid-up capital for the year1998-99 as against Rs. 75 crorefor the previous year.

4.3.3 During 1998-99, theCompany sold 17.5 MMT ofpetroleum products representing agrowth of 6.9% which was higher

than the Industry growth rate.The market share was furtherstrengthened from 20.50% in 1997-98 to 20.55% in 1998-99 enablingthe Corporation to retain its secondposition in the Industry.

During April-December 1999, theCorporation commissioned 20 retailoutlets, 2 kerosene dealerships

22

and 90 LPG distributorships andreleased 12 lakh new LPGconnections.

BPCL's retail outlets in the statecapitals and major towns areprovided with Unleaded Petrol(ULP) facilities. All the ROs inDelhi and Mumbai dispense ULPonly. Similarly, Extra Low SulphurHSD (0.25% Sulphur) has beenintroduced in all major towns asper the directives of the Ministry.

During the year 1998-99, theCorporation commissioned 6 LPGbottling plants and producttankage of 4.15 lakh kls at variouslocations in the country.

4.3.4 MAJOR PROJECTSCOMMISSIONED

Diesel Hydro DesulphurisationProject

The objective of the project is toconserve and upgrade theenvironment by reducing theSulphur level in HSD from existing1% wt(max.) to 0.256% wt. (max.)with effect from 1.4.1999 in linewith the directive by the Ministryof Petroleum & Natural Gas to alloil companies including BPCL.

The approved cost of the project isRs. 622.18 crore with a foreignexchange component of Rs. 78crore.

The DHDS Complex has beencommissioned in July 1999.Supply of Low Sulphur HSDcommenced w.e.f. 1.8.1999.

4.4.1 HINDUSTAN PETROLEUMCORPORATION LIMITED(HPCL)

HPCL is a Public SectorUndertaking (PSU) and is thesecond largest integrated oilcompany in India. It has tworefineries producing a variety ofpetroleum products - fuels,lubricants and speciality products,

one in Mumbai (West Coast) havinga capacity of 5.5. MMTPA and theother in Visakhapatnam (EastCoast) with the capacity of 4.5MMTPA (being augmented to 7.5MMTPA). The Corporation alsooperates the only joint venturerefinery in the country - theMangalore Refinery &Petrochemicals Limited (with anaugmented capacity of 9 MMTPA)in association with Aditya BirlaGroup of Companies and isprogressing towards setting up itssecond joint venture refinery inthe state of Punjab. HPCL ownsand operates the largest LubeRefinery of 3,35,000 Metric Tonnescapacity in the country producingLube Base Oils of internationalstandards. The authorised andpaid-up capital of the Corporationas on 31.3.1999 were Rs. 250crore and Rs. 225.58 crore,respectively. The Government ofIndia holding in HPCL is 51.06%.It is one of the Navratna companies.

4.4.2 During the year 1998-99,the two refineries of theCorporation achieved a combined

crude throughput of 9.07 MMTcompared with 8.84 MMT in 1997-98. The throughput achieved uptoDecember 1999 has been 7.68MMT. The total sale of petroleumproducts during 1998-99 was16.98 MMT compared with 15.46MMT in 1997-98. Sales volumeachieved upto December 1999 hasbeen 12.99 MMT. The salesturnover increased to Rs. 25.994.6crore in 1998-99 from Rs. 20,512.9crore in 1997-98 and the net profitRs. 901.26 crore from Rs. 701.16crore. The Corporation declared adividend of Rs. 248.71 crore forthe year 1998-99 equivalent to110% of the paid-up capitalcompared with Rs. 108.89 crorefor the previous year. The salesturnover and the profit before taxof the Corporation during April-December 1999 have been Rs.23,375 crore and Rs. 872.94 crorerespectively.

4.4.3 During April-December,1999 the Corporationcommissioned 28 retail outlets, 3kerosene dealerships and 25 LPGdistributorships, and released13.75 lakh LPG connections

A night view of HPC�s retail outlet

23

4.4.4 PROJECTSA) Major Projects CompletedDuring the Year4 New POL Depots/terminals witha tankage of 48100 KL andadditional tankage of 262000 KLat 8 locations were completed at atotal cost of Rs. 113 crore.

2 New LPG bottling plants with atotal capacity of 24 TMTPA werecompleted and capacity of oneexisting LPG bottling plantsaugmented by 18 TMTPA at a totalcost of Rs. 22 crore.

Lube blending plant at Silvassawith a capacity of 600 KL/month(Phase-I) has been commissionedin December 1999, within a recordcompletion period of 4 months.

B) Major Projects UnderImplementationThe expansion of Visakh Refineryfrom 4.5 MMTPA to 7.5 MMTPA ata cost of Rs. 963.91 crore isexpected to be completed byJanuary 2000.``

Installation of CO Boiler at anestimated cost of Rs. 27.21 crorefor Energy conservation andenvironmental management atVisakh Refinery is expected to becompleted by February 2000.

Hydro-desulphurisation of Dieselfor meeting the revised stringentspecification of 0.25 wt.% sulphurcontent is being implemented atboth Mumbai and Visakh Refineriesat a total approved cost of Rs.1552 crore. The projects areexpected to be completed byDecember 1999.

Construction work is in progressfor additional tankage and alliedfacilities at 7 locations with totaltankage of 1.11 lakh KL at anestimated cost of Rs. 52 crore. Theprojects are scheduled to becompleted in phases during lastquarter of 1999-2000.

Construction work is in progressfor five LPG bottling plants with atotal capacity of 156 TMTPA,resitement of one LPG bottlingplant of 88 TMTPA capacity andcapacity augmentation at threeexisting LPG bottling plants bytotal of 46 TMTPA. The projectsare estimated to cost Rs. 112 croreand are scheduled to be completedduring last quarter of 1999-2000.

Phase-II of Silvassa lube blendingplant with capacity of 60 TMTPA isexpected to be completed byDecember 2000 at a total cost ofRs. 40 crore.

Visakh Vijayawada pipeline (VVPL)Extension to Secunderabadenvisages extending the VVPL fromVijayawada to Secunderabad tocater to the important consumptionzones of Andhra Pradesh and hasbeen approved at a cost of Rs.377.55 cr. with a completionschedule of 24 months.

4.5 INDIAN OIL CORPORATIONLIMITED (IOCL)

4.5.1 IOC is the largest integratedoil company in the pubic sector in

India. It has seven operatingrefineries at Guwahati, Barauni,Gujarat, Haldia, Mathura, Panipatand Digboi having a combinedinstalled capacity of 35.60 milliontonnes per annum. It owns a6453 km network of crude oil andproduct pipelines across thecountry, with installed capacity of43.45 million tonnes per annum.The authorised and paid-up capitalof the Corporation as on 31.3.1999were Rs. 2500 Crore andRs. 389.31 Crore respectively.

4.5.2 The refineries of IOC achieveda crude throughput of 30.36 milliontonnes during 1998-99. Againstthe MOU target of 31.80 milliontonnes for 1999-2000, thethroughput achieved uptoDecember 1999 has been 23.86million tonnes. IOC's pipelinesachieved a throughput of 34.05million tonnes during 1998-99.The MOU target for 1999-2000 is37.34 million tonnes and theachievement upto December 1999has been 29.41 million tonnes.

4.5.3 The Corporation sold 46.05MMT of petroleum products during

A view of the diesel hydrodesulphurisation unit commissioned at IOC's Gujarat refinery forproduction of extra low-sulphur diesel

24

1998-99, registering an increaseof 2.64 MMT over the previousyear. During April-December1999, it has sold 36.58 MMT ofpetroleum products with a marketparticipation of 54.57% at the endof December 1999.

4.5.4 The Corporation achieved aturnover of Rs. 69,430 Crore in1998-99 as against Rs. 59,176Crore in 1997-98. The profitbefore tax was Rs. 2,733 Crore forthe year 1998-99 and the profitafter tax was Rs. 2,214 Crore. Thecorresponding figures in theprevious year were Rs. 1,964 Croreand Rs. 1,706 Crore respectively.The anticipated turnover and profitafter tax of the company for theyear 1999-2000 is Rs. 85,310 croreand Rs. 2764 crore respectively.

The Corporation declared adividend of 130% amounting toRs. 506 Crore for the year 1998-99.

4.5.5 Major Projects Completedduring April-December 1999

1. New Delayed Coker Unit atDigboi Refinery.

2. Diesel Hydro-desulphurisationUnits at Gujarat, Panipat,Mathura and HaldiaRefineries.

3. Gujarat Refinery Expansionfrom 9.5 to 12.5 MMTPA.

4. Matching SecondaryProcessing Facilities atMathura Refinery.

5. Augmentation of Kandla-Bhatinda pipeline from 6.0 to7.5 MMTPA.

6. Augmentation of Salaya-Viramgam and Viramgam-Koyali sections of Salaya-Mathura pipeline from 17.2and 5.0 to 21.0 and 6.5MMTPA respectively.

The country's first �Jubilee Outlet� Commissioned by IndianOil at Ongole in AP

7. Branch pipeline to BudgeBudge from Haldia-Mourigram-Rajbandh pipeline.

8. Strategic Crude Oil tanks atChaksu station of Salaya-Mathura pipeline.

9. Pipeline Terminal atChitraganj (Calcutta) with40,292 KL tankage

10. New Depot at Manali with3,000 KL tankage

11. Additional tankage of 37,030KL at 4 locations

12. 4 LPG Bottling Plants(Gandhar, Bokaro, Patna andThimmapur) with a combinedcapacity of 234 TMTPA

Major Projects underImplementation

1. Eastern India Refinery Project.

2. Fluidised Catalytic CrackingUnit at Haldia.

3. Barauni Refinery Expansionto 6 MMTPA.

4. Hydro-treatment Facilities atGuwahati.

5. Hydro-treatment Facilities atDigboi.

6. Solvent De-waxing/De-oilingUnit at Digboi.

7. Paraxylene/PTA Plant atPanipat.

8. Catalytic De-waxing Unit atHaldia.

9. Panipat Refinery Expansionto 12 MMTPA.

10. Residue Upgradation Projectat Gujarat.

11. Augmentation of Haldia-Barauni Crude Oil Pipelinefrom 4.2 to 7.5 MMTPA.

12. Replacement of Barauni-Patnasection of Barauni-KanpurPipeline.

13. Augmentation of Kandla-Bhatinda Pipeline to 8.8MMTPA.

14. Vadinar-Kandla ProductPipeline (For Petronet IndiaLtd.).

15. Chennai-Tr ichy-MaduraiProduct Pipeline (for PetronetIndia Ltd.)

16. Marketing Terminal at Paradip(Eastern Indian Refinery).

25

17. LPG Bottling Plants at 21locations.

18. Terminals/Depots/Tankage/TOPs etc. at 13 locations.

New Projects Planned

Major projects planned to be takenup are listed below.

❏ Linear Alkyl Benzene projectat Gujarat.

❏ LOB Production at Gujarat.

❏ Additional Diesel Hydro De-sulphurisation project atMathura.

❏ MS Quality ImprovementProjects at all refineries.

❏ South India Refinery Project.

❏ Improvement of HSD quality& distillate yield at Haldia.

❏ Augmentation of SecondaryProcessing Facilities atMathura.

❏ Augmentation of Salaya-Mathura Crude Oil PipelineSystem and laying of Pipavav-Koyali Crude Oil Pipeline forsupply of additional crude oilto Gujarat, Mathura & PanipatRefineries for their expansion.

❏ Extension of Mathura-Jalandhar Pipeline toUdhampur.

❏ Koyal i -Navagam-SidhpurPipeline

❏ K o y a l i - P i p a v a v / H a z i r aPipeline.

❏ Bottling Plants at 14 newlocations

❏ Terminals at 25 locations

4.5.6 Business Development(April - December, 1999)

Indian Oil Corporation has initiatedseveral measures for expansion,diversification and globalisation of

business. Some of the activitiesembarked upon are:

� Submission of bids under theNew Exploration LicensingPolicy (NELP) round in India.

� Memorandum of StrategicAlliance (MoSA) with ONGCfor combined downstream &upstream operations in Indiaand abroad.

� Appointment of Lubedistributors abroad.

� MOU with IPCL for co-operation in refinery,petrochemicals and power.

� Setting up power projects atPanipat (Haryana) and Savli(Gujarat) in joint venture withMNCs.

� MOU signed with Elf Antar,France, for marketing of fueladditives and collaboration inR&D. Diesel fuel additivesalready introduced in themarket.

4.6 INDIAN OIL BLENDINGLIMITED (IOBL)

The Indian Oil Blending Limited isa 100% subsidiary of the IndianOil Corporation engaged in themanufacturing of lubricants andgreases. During 1998-99, IOBLearned a net profit of Rs. 1066lakh as against Rs. 758 lakh inthe previous year. A dividend of25% was declared for the year1998-99.

4.7 IBP CO. LIMITED (IBP)

IBP Co. Limited was incorporatedin 1909 and became a subsidiaryof IOC in 1970 and an independentGovernment company in 1972.Over the years, the company hasdiversified into other activities suchas Industrial Explosives and

Cryocontainers. The Company isthe largest manufacturer ofExplosives in India and is the onlymanufacturer of Explosives withinthe country to have been accreditedwith the prestigious ISO-9002certification. The Company hasgot three distinct Business Groups,namely, Business Group(Petroleum), Business Group(Chemicals) and BusinessGroup(Engineering).

The authorised capital and theissued and subscribed capital ofthe company on 31.03.1999 wereRs.100 crore and Rs.22.15 crorerespectively. The Government ofIndia holding in the paid-up capitalis 59.58%.

The physical performance of thecompany during 1998-99 inregard to sale of petroleumproducts was 58,96,284 KLsrepresenting a growth of 6.74%over the previous year. Thevolume is anticipated to be62,79,542 KLs in 1999-2000. Thesale of lubricants and greases in1998-99 was 31,423 KLs markinga growth of 16.00% over theprevious year. It is anticipatedto 34,892 KLs in 1999-2000.

The anticipated turnover of thecompany for the year 1999-2000is Rs.6500 crore. The turnover in1998-99 was Rs.5670 crore. Thecompany expects a net profit ofRs.39.48 crore in 1999-2000 asagainst Rs.35.23 crore in 1998-99.It paid a dividend of Rs.9.52 crorefor the year 1998-99 Rs./crorecompared with Rs. 5.54 crore forthe year 1997-98.

During the year 1998-99, theCompany commissioned depotswith Additional Tankage of 83396KLs at various locations. DuringApril-December, 1999, AdditionalTankage commissioned is 28550KLs.

26

The company had 1449 retailoutlets, 375 kerosene dealershipsand 6 LPG distributorships as on30.09.1999.

The Company has firmed up itsplan for entering into domesticLiquefied Petroleum Gas (LPG)business under the brand name"IBP Gas". The Company hassince commissioned its maidendistributorship under the PublicDistribution System (PDS) of theGovernment of India at Vandavasiin the State of Tamil Nadu on 25thJune, 1999 and at Duttapukur inthe State of West Bengal on 14thJuly, 1999.A Jubilee Retail Outlet Recently Commissioned by IBP

27

5.1 ENGINEERS INDIA LIMITED(EIL)

5.1.1 Introduction

Engineers India Limited, theleading engineering andconsultancy company in India hasbeen serving the process industryincluding petroleum refineries,petrochemicals, oil & gasprocessing projects, pipelines,offshore platforms, fertilizers andmetallurgical industries since themid sixties. EIL provides acomplete range of project servicesin these fields including processdesign, engineering, procurement,construction management, projectmanagement and supervisoryassistance for commissioning &plant start-up and has played avery significant role in setting upa large number of process plantsin India and abroad. Theauthorised and paid-up capital ofthe company as on 31.03.1999stood at Rs.50 crore and Rs.18.72crore respectively.

5.1.2 EIL's quality managementsystem conforms to ISO-9001. TheRegistered Office and Headquartersof the Company is in New Delhi.In addition it has RegionalEngineering Offices in Chennaiand Vadodara, OverseasEngineering Office in Doha(Qatar);Branch Offices in Calcutta andMumbai; Inspection/ProcurementOffices at various locations allover India and also in London andTokyo and Construction Offices atdifferent project sites in India andabroad. The total number ofemployees of the company is 3800.

5.1.3 Important Assignments

The Company continued to makeextensive efforts to keep its orderbook position healthy andcommensurate with the manpoweravailability inspite of the stiffcompetitive situation.

Major assignments in the fields ofRefineries, Petrochemicals, GasProcessing and Metallurgy weresecured by EIL during the year.The major Refinery jobs securedby EIL during the year includePMC Services Contracts for SolventDewaxing/Deoiling Projects,Hydrotreater Projects at Digboi andGuwahati, Barauni RefineryExpansion Project and EasternIndia Refinery Project of Indian OilCorporation. In addition, thecompany was awarded withpreparation of detailed feasibilityreport for yield and Energyimprovement in CDU/VDU-II ofHPCL and detailed feasibility reportand licensor selection for CDU/VDU Project of BPCL.

In the field of Petrochemicals, EILhas been awarded Engineering,Procurement, ConstructionSupervision and ProjectManagement (EPCM) Contract forconstruction of Styrene StorageTank of Gujarat Chemical PortTerminal Co. Ltd. (GCPTCL),Expansion of Gas Cracker Plant atMGCC beyond 400,000 TPAEthylene through ARS route ofIPCL and preparation of detailedfeasibility report for Expansion ofUP Petrochemical Complex of GAIL.

In the Gas Processing stream, EILhas been awarded LPG Project atGandhar of GAIL, Revamping/Upgradation of Oil and GasReceiving Distribution System ofONGC Ltd., DM Water Tank andModification work at Hazira GasProcessing Complex of ONGC Ltd.

During the year, EIL has alsotaken up PMC work for Jetty/Docklines and Terminal at JNPT ofBPCL and preparation of detailedfeasibility reports for Strategicstorage of Imported Crude Oil ofOCC.

In the Power sector, EIL has beenable to make entry into the residue

OTHERUNDERTAKINGS/ORGANISATIONS

CHAPTER V

28

based Power Plant market bybagging jobs for preparation ofdetailed feasibility reports forRefinery Residue based PowerPlants of MRL, HPCL and IOCL.

In the field of metallurgy, EIL hasbagged preparation of front endengineered package and bidevaluation for Polymetallic NodulesProject of HZL and updation ofdetailed feasibility report for UtkalAlumina Project of GAIL.Besides these, EIL has also securedfew major jobs in the Pipelinesfield. The major jobs includeLoopline from Kakinada Junctionto NFCL and Feeder Pipelines fromKesanapalli and Mori fields ofONGC to existing Pipeline NetworkProject of ONGC, expansion ofVVPL and its expansion uptoSecunderabad of HPCL, NTPCJhannore Pipeline of GAIL,Installation of additional 2.7 MWGTC Train of GAIL, consultancywork for existing Pipeline Networkin Noida Project of GAIL, Met GasPipeline Project from Dabhol toKirat Mainline and Laterals.During the year, EIL also securedtwo turnkey contracts for Pipelineand Platform Modification (PPM)Project and Clamp-on RelatedModification and Pipeline-II (CRMP-II) Project of ONGC.The Company secured a numberof assignments in the areas ofEnvironment engineering,Specialist Maintenance and RiskAnalysis, advance control andoptimisation and informationtechnology.Outside India, EIL was successfulin getting a contract for engineeringconsultancy services forimprovement of Refinery Heatersand Boiler Thermal EfficiencyProject of Kuwait PetroleumCorporation(KNPC). The companywas also awarded Hazop study forprocess units 06, 07, 63, 12 & 13

in Shuaiba refinery of KNPC, studyfor deficiency in CathodicProtection System of Undergroundwater lines in Refinery units ofKNPC, study and technicalevaluation of existing shut downsystem in Mina-Abdullah refineryof KNPC.

Other smaller assignments fromAustralia, Bahrain, Oman, Nigeriaand U.S.A. were also secured.

5.1.4 Policy Initiatives taken byEIL during 1998-99The major policy initiatives takenby EIL include the following:

Strategic AlliancesAlliances were formulated withseveral organisations for LNGProjects, Refinery residue basedpower plants, Deep Watertechnology and LSTK bids etc. ona case to case basis.

Turnkey AssignmentsBidding for turnkey projects wastaken up. Two Turnkey projects-Pipeline and Platforms Modification(PPM) Project and Clamp-onRelated Pipelines (CRMP) Projectof ONGC Ltd. have been securedduring 1999-2000.

Y2K ComplianceStrengthening of computer andcommunications infrastructurecontinued as one of the thrustareas. Software packages used inthe organisation including theFinance & Accounts softwarepackages were made Y2Kcompliant. Besides, a separateserver was setup at HQ for Internetusage which has been connectedto the LAN at HQ.

Technology DevelopmentThree R&D Development Projectswere identified in the MOU forcompletion in 1999-2000. A R&Dproject basket was identified inthe MOU for commercial

application and of these threeapplications had been targeted for1999-2000.

Information Technology ServicesThe Information TechnologyServices have been identified as athrust area for developing businessand undertaking assignments forclients outside the organisation.In this direction, jobs executedincluded design development andimplementation of Online MaterialsInformation system for IPCL, PlantData Base for Panipat Refinery,Remodelling of Piping systems forAker Engineering etc.

Human Resource DevelopmentFor updating the functional andtechnical skills of the employees,ninety training programmes wereidentified in the MOU forcompletion in 1999-2000.

The company achieved a turnoverof Rs.391.7 crore during 1998-99compared with Rs.311.2 crore in1997-98 and earned a net profit ofRs.117.7 crore as against Rs.73.2crore in the previous year. Itdeclared a dividend of Rs.28 crorefor year 1998-99 compared withRs.7.5 crore for 1997-98.

5.2 LUBRIZOL INDIA LIMITED(LIL)5.2.1 Lubrizol India Limited (LIL),a Public Sector Undertaking, wasincorporated in 1966 incollaboration with the LubrizolCorporation,U.S.A ,under theCompanies Act , in pursuance ofan agreement between theGovernment of India and theLubrizol Corporation, U.S.A inDecember 1965. The Governmentof India holds 60% of thesubscribed equity capital of theCompany and the LubrizolCorporation, U.S.A., 40% thereof .The Company's manufacturing unitis situated at Village Turbhe,Thane-Belapur Industrial Complex,

29

adjacent to New Bombay . TheCompany has a second unit formanufacture of Extreme PressureAdditives at Aloja, Dist. Raigad.LIL develops, manufactures andmarkets additives systems forautomotive and industriallubricants and also develops otherspeciality chemicals, catering tothe needs of the PetroleumIndustry. The authorised, issuedand subscribed share capital ofthe company is Rs. 1920 lakh.

The company achieved a salesvolume of 40,281 MT and salesincome of Rs.392.37 crore in 1998-99. The projections for 1999-2000 are 41,000 MT and Rs.409.45crore, respectively.

The production of ChemicalAdditive Packages upto December1999 has been 30,936 MT. Theanticipated production for the year1999-2000, is 41,000 MT.

The Company has earned ProfitBefore Tax (PBT) of Rs.61.9 crorein 1998-99. For the year 1999-2000, the projected PBT is Rs.55.8crore.

The Company paid a dividend of65% on the paid up share capitalof Rs. 19.20 crore for the year1998-99 as against 40% duringthe previous year. Thecontribution made by the companyto the exchequer by way of dutiesand taxes during the year 1998-99was Rs.132..48 crore as comparedwith Rs.130.38 crore during theprevious year.

5.2.2 Restructuring of LubrizolIndia LimitedRestructuring of Lubrizol India Ltd.was approved by the Governmenton 19th March, 1999. The exerciseof valuation of the price of sharesto complete the capitalrestructuring process of LubrizolIndia Ltd. was completed inDecember, 1999.

5.3 INDIAN ADDITIVES LIMITED

Indian additives Limited (IAL) is ajoint venture company promotedby Madras Refineries Limited (MRL)and Chevron Chemical Company(Chevron) in the year 1989. It hasmanufacturing facilities includinga blending unit for lubricantadditive packages. Chevron is thetechnical collaborator and hasprovided formulation technologyand technical know-how for theproject. In February, 1999,Government decided to reduceMRL's equity in the company from60% to 50% and that of Chevronto increase from 40% to 50%.Consequently, IAL is now a non-Govt. company. IAL has anauthorised capital of Rs.30 croreand paid-up capital of Rs.19.72crore as on 31st March, 1999,held by MRL and Chevron in theratio of 60:40.During the year 1998-99, thecompany sold 16,103 MTs ofadditives as against 13,255 MTs inthe previous year. The companyhas developed the latest generationmultigrade oil for Indian Railways,which would save fuel andlubricants. It has also developedformulations for low smoke 2T oilto reduce the environmentalpollution.IAL earned a net profit of Rs.8.54crore and declared a dividend ofRs. 1.48 crore for the year 1998-99.5.4 BALMER LAWRIE & CO.LTD.5.4.1 Balmer Lawrie & Co. Ltd.became a Government Company,when it became a subsidiary ofIBP Co. Limited in August, 1972.The authorised capital and thepaid-up capital of the company ason 31.3.1999 were Rs.30 croreand Rs.16.29 crore respectively.5.4.2 The company is a diversifiedmedium-sized company with

operations spread throughout Indiaand overseas. The main activitiesof the Company broadly areclassified into various groups,namely:-i) Industrial Packaging, ii)Greases and Lubes, iii)Containerisation, iv) PerformanceChemicals, v) Travel, Tours &Cargo, vi) Tea Exports andInternational Trading, vii) ProjectEngineering and Consultancy andviii) Research and Development.

5.4.3 During the year 1999-2000,the company is expected tomanufacture 28 lakh barrels/drums against 27.61 lakh in 1998-99. The company is expected toproduce 38,000 tonnes of greasesand lubricants during 1999-2000,same as in 1998-99. It alsoanticipates decrease in the numberof marine freight containers forexport from 1962 in 1998-99 to600 in 1999-2000.

5.4.4 The total turnover of thecompany is anticipated to increasefrom Rs.657.81 crore in 1998-99to Rs.700.00 crore in 1999-2000.While the company has achieved aprofit after tax of Rs.16.83 croreduring 1998-99, the anticipatedprofit after tax for the year 1999-2000 is Rs.9.30 crore. Thecompany declared a dividend ofRs. 4.88 crore for the year 1998-99, as against Rs. 5.21 crore forthe previous year.

5.5 BIECCO LAWRIE LIMITED

Biecco Lawrie Limited, now aGovernment of India Undertakingunder the administrative controlof the Ministry of Petroleum &Natural Gas, was established onDecember23, 1919. The Companyis a Calcutta based medium sizedEngineering company having twofactories at Calcutta. The Companyhas been conferred with the statusof a Mini Ratna by the Governmentfor its performance in the last few

30

years. The authorised capital andthe paid-up capital of the companyas on 31.3.1999 were Rs.50 croreand Rs.42 crore respectively.

The physical performance of theCompany upto December, 1999 inregard to sale of switchgear panels& switchagear spares and otherswas Rs.1907 lakh and that forelectrical repair jobs was Rs.182lakh.

The total sales turnover of thecompany for 1998-99 was Rs.71.82crore against Rs.80.54 crore in1997-98. This was mainly due todecrease in Electrical Repairs Jobsand Turnkey Electrification Projectactually coupled with a low volumeof sales in SKO and Paraffin Wax.

Considering the need to improveupon its performance level, thecompany has decided toconcentrate in the areas ofResearch & Development, QualityAssurance, Computerisation andSystematisation, IntellectualCapital, Knowledge BasedOrganisation etc. to enhance

overall performance under a turn-around situation.

5.6 OIL INDIA SAFETYDIRECTORATE (OISD)

5.6.1 OISD assists Safety Councilof the Ministry of Petroleum &Natural Gas (MOP&NG) which isheaded by Secretary, MOP&NG asChairman and includes the JointSecretaries, Advisors in theMOP&NG, Chief Executives of allthe Public sector Undertakings(PSUs) under the Ministry, ChiefController of Explosives (CCE),Adviser (Fire) of the Govt. of Indiaand the Director General of FactoryAdvice Service & Labour Instituteas members.

Standardisation is one of the majoractivities of Oil Industry SafetyDirectorate. Standardisation isrequired to keep abreast of thelatest design and operatingpractices in the areas of safety andfire fighting in the hydrocarbonprocessing industry in thedeveloped countries, so as todevelop standards and codes that

would be suitable for the conditionsin India. The areas wheres t a n d a r d s / r e c o m m e n d e dpractices/guidelines need to bedeveloped are identified byanalysing the incident data basedeveloped at OISD. Thestandardisation work is then takenup by the Functional Committeesnominated by the SteeringCommittee. As a continuousexercise, new areas forstandardisation are identified.During the period under review, 7numbers of Standards wereprinted.Review / Revision of StandardsOISD standards are generallyreviewed every 4 years after firstpublication to incorporate the latesttechnological changes andexperience gained in theirimplementation so as to updatethem in line with the currentinternational practices. 3 standardshave been already revised andprinted. During last SafetyCouncil Meeting, the process toissue interim amendments to theOISD standards was approved.Accordingly, interim amendmentsto three standards were approvedby the steering committee.As on December31, 1999, overallstatus of Standardisation is asfollows:Total standards/recommendedpractices/ guidelinesidentified 91(A) Published & Distributed 72(B) New Standards under

various stages ofpreparation 19

5.6.2 Training Programmes/WorkshopsVarious training programs andworkshops organised by OISDduring the period are as follows:

● Seventh Oil Industry SafetyWorkshop for refineries was

Blending Kettle of Biecco Lawrie Ltd.

31

arranged at HPCL MumbaiRefinery in July, 1999.

● Fourth Oil Industry SafetyWorkshop for upstreamoperations was arranged atOIL, Duliajan in April' 1999.

● Training course onEnvironment ImpactAssessment was conducted inAugust, 1999.

● Ninth Marketing Workshop formarketing personnel(Northern & Eastern Region)was arranged at Lucknow inAugust '1998.

● Fifth Oil Industry SafetyWorkshop for upstreamoperations was arranged atONGC, Rajamundry inDecember, 1999.

5.6.3 Accident Data Base andDissemination of SafetyInformation

This is a continuous activity ofOISD wherein details regardingfires, accidents and near missesoccurring in the installations ofthe entire industry are received ona quarterly basis and stored in acomputerised Data Base. Afteranalysis, the information showingstatistical trends, areas of concern,major recommendations etc. isdisseminated to industry throughSteering Committee Meetings,Workshops and OISD Journal-Petrosafe. OISD has also startedpublishing monthly newsletter"OISD Newsletter" from November,98 to disseminate information onvarious safety related activities.

A booklet giving details of majorincidents in upstream anddownstream oil sector, its analysisfor the period April, 1996 to March,1999 was prepared and distributedto industry members. It is hopedthat the analysis of variousincidents in the Crude Oil

Exploration & Production, Refining,Transportation and Marketingsectors, discussed in this booklet,shall help industry to study thefield operating conditions and takecorrective action so as to avoidrecurrence of incidents.

5.6.4 Computerisation

A new Local Area Network (LAN)computer system with IBM Server,Scanner etc. was installed at OISDoffice. All the users i.e. officersand staff were provided withpersonal computers with access toboth the servers i.e. CD ROM andIBM 320. Various safety relatedinformation like NEPA, OISDstandards, accident data base etc.are kept on server for easy accessfor the users. The OISD standardshas been brought in the form ofCD ROM and updated regularly.

5.7 CENTRE FOR HIGHTECHNOLOGY (CHT)

5.7.1 Centre for High Technology(CHT), a Registered Societyfunctioning under the Ministry ofPetroleum & Natural Gas, Govt. ofIndia, acts as a focal point of oilindustry for co-ordinating andfunding of research work in refiningand marketing areas, exchange ofinformation and experiences,assessing technology requirementsand getting them developedindigenously. The major functionsand responsibilities of CHT include:

● Advise and implement thescientific and technologicalprogrammes of the Ministryof Petroleum and Natural Gasand be its executive wing forco-ordination, import,acquisition and upgradationof technology.

● Assess the operationalperformance of the refineriesspecifically from the point ofview of energy utilisation in

the process units and advisethe Ministry.

● Identify the gaps in R&D inrefining processes andproducts and identify theorganisation which can takeup that work, fund the projectwork and monitor theirprogress.

● Develop programmes inconsultation with the industryfor improving the performancethrough upgradation, use ofnew techniques and advancedtechnology.

● Develop a centralised pool ofinformation on theoperational, maintenance andtechnical experiences of therefineries for use by theindustry.

● Co-ordinate and pursue theprogrammes of ScientificAdvisory Committee ofMOP&NG and otherGovernment bodies / agenciesas required.

5.7.2 CHT Sponsored Projects

CHT, in line with therecommendations of the ScientificAdvisory Committee onHydrocarbons of Ministry ofPetroleum & Natural Gas, sponsorsimportant R&D programmes fordeveloping indigenous technologiesand for absorption of newtechnologies. These projects arefinanced by Oil IndustryDevelopment Board through CHT.The major R&D projects completedduring 1999-2000, the projectswhich are in progress and thoseapproved during 1999-2000 are asunder :

Projects completed during 1999-2000

● Performance, Testing &Development of Burners

32

● Etherification of C5 olefinsand FCC gasoline

● Heat Transfer Enhancementby Tube Inserts

● Development of Cooling TowerTechnology

Projects under progress● Research Facility in the Area

of Advanced Control● Diesel Fuel Quality

Requirement for Meeting theFuture Emission Standards

● Hydrocracker Pilot Plant/Laboratory Project

● Catalyst & TechnologyDevelopment forHydrotreatment of Diesel &Vacuum Gas Oil (VGO)

● Production of High QualityMicro-crystalline Wax (MCW)Using Short Path Distillation(SPD) Technology

● Assessment of Residual Lifeof Turbine Oil : Phase II

● Technology development ofHydrodynamics of Trickle BedReactors - Cold Flow Studiesfor Scale-up

● Maintenance of MultipurposeDynamic Simulator

● Development of Flash ZoneEntry Device for VacuumColumn

● Production of LPG and HighOctane Gasoline fromNaphtha/NGL

● Development of Catalyticprocess for Isomerisation ofWaxy stocks into Lube Oil

● Development ofComputational Fluid DynamicCapabilities

● Sour Natural Gas andIndustrial Gas Treating

● Development of Eco-friendly/Bio-degradable Lubricants/Base Fluids

5.7.3 Activities related to EnergyConservation in Refineries

● Energy Conservation Awards

● Oil Conservation Awards● Bench Marking & Targeting

of Energy Consumption● Fuel & Loss targets for the

refineries

5.7.4 Assistance to MOP & NG/IndustryCHT has been actively involved inthe following activities :● Fuel quality issues and the

implications of changes in thespecifications of MS and HSDproposed by Bureau of IndianStandards/Ministry ofEnvironment & Forests.

● Monitoring implementation ofDiesel Hydrodesulphurisation(DHDS) projects at ninerefineries

● As a member of the TechnicalEvaluation Committee (TEC),for evaluation of proposalsreceived from Small ScaleIndustries (SSIs) for use/manufacture of specialitypetroleum products.

● Monitoring the progress/status of various projectsundertaken by the oilcompanies for improvementin distillate yields/productquality

● Review of proposals from oilcompanies for entering intoForeign TechnicalCollaboration

5.7.5 CHT PublicationsCHT publishes a quarterlytechnical journal "HydrocarbonTechnology". It also circulates aquarterly "Technology Scan" whichincorporates a consolidated list ofarticles, categorised under majorsubject heads, with journalreference and a brief abstract basedon scanning of some of theimportant journals published inthe field of Petroleum Refining.These publications have a widecirculation and are well

acknowledged for their technicalcontent.

5.8 PETROLEUM INDIAINTERNATIONAL

5.8.1 A Decade Of TechnicalServices To Oil CompaniesWorldwide

Petroleum India International (PII)is a consortium of ten publicsector companies operating in thePetroleum and Petrochemicalssectors. PII was established in1986 with the common objectiveof mobilizing the individualcapabilities of its membercompanies into a joint endeavorfor providing technical, managerialand other human resources to allcompanies abroad. The ConsortiumMembers Of PII are:

� Bharat Petroleum CorporationLimited

� Bongaigaon Refinery &Petrochemicals Limited

� Cochin Refineries Limited� Engineers India Limited� Hindustan Petroleum

Corporation Limited� IBP Co. Limited� Indian Oil Corporation Limited� Indian Petrochemicals

Corporation Limited� Madras Refineries Limited� Oil & Natural Gas Corporation

Limited

5.8.2 In the past twelve years, PIIhas already provided its servicesto well known companies abroad afew of them are:

� Nigerian National PetroleumCorporation (NNPC), Nigeria.

� Kuwait National PetroleumCompany (KNPC) Kuwait.

� Technip ESIA at Khaleej JointVenture (TPJV), France.

� Abu Dhabi National OilCompany (ADNOC), UAE

33

� Jeddah Oil Refinery Company(JORC), Saudi Arabia.

� Kellog Plant Services inc.Kuwait.

� Empressa National PetroleosDe Mocambique (Petromoc),Mozambique.

� Toyo Engineering, Japan

� LG Engineering - Thailand.

� Petronas Research & ScientificServices SDN BHD, Malaysia

� China Petroleum Engg.Construction Corpn. (atKuwait)

� Advanced Technical Services(ATS), Doha Qatar

� National Engg. & TechnicalCo., Nigeria

5.8.3 PII generated an income ofRs.23.58 crore during 1998-99 andearned a net profit of Rs.8.45crore. The anticipation for theyear is Rs.33.85 crore and Rs.10.61crore respectively.

5.9 OIL COORDINATIONCOMMITTEE

5.9.1 The Oil CoordinationCommittee (OCC) was set up on14.7.1975 through a Governmentof India Resolution on therecommendation of the InterimReport of the Oil Prices Committee(OPC).

5.9.2 Secretary, Petroleum &Natural Gas is the Chairman ofthe OCC APEX Body and Addl.Secretary, Jt. Secretary (Refineries),Jt. Secretary & Financial Adviserof Ministry of Petroleum & NaturalGas, Chief executives of OilCompanies and ED, Oil IndustrySafety Directorate are its members.The day to day functions arehandled by the OCC Secretariatunder the Executive Director (OCC)who is also a Member Secretary ofthe Committee.

5.9.3 The main functions of OCC,are as under:-

● Monitoring the performanceof Oil Industry to achieveoptimality

● Preparing estimates forsupply/demand and importplans

● Assisting the Ministry in thepreparation of Oil EconomyBudget (OEB)

● Coordination of supply ofcrude oil to the refineries

● Operation and Maintenanceof pool accounts

● Coordination of majormarketing activities of the oilindustry.

● Coordination with variousGovernment departments /agencies to facilitateCoordination with Railwayson optimising tank wagonmovement and optimise themovements of petroleumproducts etc

● Assisting the Ministry in themanagement of crisis situationand special situation such asstrikes, bandhs, floods,elections etc. for un-interrupted supplies ofpetroleum products.

5.9.4 OCC has set up a Computersand Communication Wide AreaNetwork (OILCOMNET) for theentire Oil Industry, which supportse-mail, transmission of HindiMessages, Fax Messages and filetransfers. It caters to all theComputer & Communicationsrequirements of the OCC andMOP&NG. All the Oil Companies,MOP&NG, EIL, CHT, PCRA etc. areconnected to this Network and canexchange their messages and data.The network is having a number ofdatabases.

5.10 OIL INDUSTRYDEVELOPMENT BOARD

5.10.1 Functions of the Board

The Oil Industry DevelopmentBoard (OIDB) was set up inJanuary, 1975 under the OilIndustry (Development) Act, 1974to provide financial and otherassistance as is conducive for thedevelopment of Oil Industry. Thefinancial assistance is extended byway of loans and grants foractivities such as prospecting,refining, processing, transportation,storage, handling and marketingof mineral oil, production andmarketing of oil products andproduction of fertilizers andchemicals.

5.10.2 Resources of the Board

The funds required for variousactivities envisaged under the Actare made available to the Board bythe Central Government, after dueappropriation by Parliament fromthe proceeds of cess levied andcollected on the indigenous crudeoil. The rate of cess currently isRs.900/- per tonne on crude oilproduced in the country ascompared to Rs.60 per tonne whenit was introduced for the first timein 1974. Since inception and upto March 1999, the CentralGovernment has collected a sumof Rs.33439 crore approximatelyas cess. Out of this, OIDB hasreceived an amount of Rs.902 croretill date. No amount has beenmade available to the OIDB from1992-93 onwards. The fund of theBoard is supplemented by theinternal resources generation byway of interest receipts on loansetc. As on 31st March 1999, anamount of Rs.5273 crore hasaccrued to the Oil IndustryDevelopment Fund. During 1998-99, internal resources contributedRs.544.82 crore to the totalresource availability. The Board

34

has been exempted from theliability to pay tax on its income.

5.10.3 Assistance to Oil IndustryThe Board renders assistance byway of grant of loans for Projects,disbursements of grants forResearch & developmentprogrammes, refinancing of loansand funding expenditure ofscientific advisory committees,study groups, task forces, etc. Inorder to encourage, significantinitiatives in the area of oilexploration, the OIDB's financialassistance for exploration work inhigh risk areas carries an interestrate of 5% p.a. and the fundsprovided for exploration in lowrisk areas attract an interest rateof 10% p.a. However, in the eventof commercial discovery beingmade, interest @12% p.a. for theloan is charged. Funds madeavailable for projects in areas otherthan exploration also carry aninterest rate of 12% p.a. Theworking capital loans are madeavailable, in exceptionalcircumstances, at an interest rateof 16% p.a.

5.10.4 Deployment of fundsThe Oil Industry is capital intensiveand has a long gestation period. Itprovides useful inputs for thedevelopment of agriculture andindustry. Natural Gas has alsoemerged as an important source offuel and feedstock in variousindustrial sectors such asfertilizers, petrochemicals, powergeneration, sponge iron etc. Atpresent, per capita consumptionof petroleum products in ourcountry is much less compared tothe industrialised countries. OIDBhas accorded highest priority tothe programmes connected withexploration, production, refiningand storage of crude oil/naturalgas. On cumulative basis uptoDecember, 1999, the Board hasgiven financial assistance of

Rs. 11323 crore to the oil industry,Rs. 11015 crore as loans andRs.308 crore as grants.

A major portion of the loanassistance has gone towardsmeeting capital outlay on Planprojects approved by the Ministryof Petroleum and Natural Gas inconsultation with the PlanningCommission and the Ministry ofFinance. The loan outstandingfrom oil companies to OIDB, as on31.3.1999 was Rs.4866.00 crore.Loans and grants given during theyear 1998-99 were Rs.1107.15crore and Rs.51.24 crorerespectively.

5.10.5 Disbursement of Loansduring the year 1999-2000(upto31st December, 1999)

(Rs. in crore)Sl. Organisation Allocation FundsNo. of Funds released Upto

(1999-2000) 31.12.99

1. BRPL 15.00 0.002. Balmer Lawrie & Co. 50.00 13.003. Biecco Lawrie Limited 9.55 0.504. CRL 350.00 283.365. GAIL 251.00 251.006. IBP Co. 98.81 37.717. MRL 435.00 100.008. NRL 6.25 6.2510. Indraprashatha Gas Ltd. 15.00 0.0011. Tripura Natural Gas Co. 0.50 0.00

Total 1531.11 691.82

5.10.6 As regards disbursment ofgrants, against the allocation ofRs. 150.42 crore for the year 1999-2000, the Board has released Rs.28.06 crore upto December, 1999.

5.11 DIRECTORATE GENERALOF HYDROCARBONS (DGH)

The Directorate General ofHydrocarbons (DGH) wasestablished by GovernmentResolution in 1993 under theadministrative control of Ministryof Petroleum & Natural Gas.Objective of DGH are to promotesound management of the Indian

petroleum and natural gasresources having a balanced regardfor environment, safety,technological and economic aspectsof the petroleum activity. Detailsof some of the main activitiesundertaken by DGH during 1999-2000 are as under:-

5.11.1 Opening up of new areasfor future explorationIn its continued efforts to open upareas for future exploration, 2Dseismic data of another 1485 LineKilometres in Andaman offshorewas acquired and processed byDGH during March-April'99. Theinterpretation of the data was donejointly with M/s WesternGeophysical during May and June,1999. The preliminaryinterpretation of data has broughtout six gas hydrate leads/prospectsout of which two locations havebeen shortlisted for drilling in waterdepth of 1300-1500 metros.

5.11.2 Contract MonitoringGovernment of India had awarded30 discovered fields and 35 blocksfor exploration and development toPrivate and joint sector. Out ofthese 21 exploration blocks and18 fields are currently underoperation. DGH monitors theexecution and management ofthese Production Sharing Contractson behalf of Government of Indiathrough Management Committeesset up for each contract.

5.11.3 Field Development andReservoir & ProductionMonitoringDGH is monitoring reservoir andproduction performance especiallyof Mumbai High field and also ofall joint venture and privatelyoperated fields. Special IntegratedDevelopment Plan Studies for Mid& South Tapti field are in progressin association with IRS, ONGC,Ahmedabad. Short term study ofPanna field is also in progress.

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6.1 Consumption of petroleumproducts in India has been growingsteadily at a rate of 8-10% perannum. Our degree of self reliancein this sector is only around 30%today. Therefore, high priority isgiven to the conservation ofpetroleum products.6.2 IN HOUSE CONSERVATIONEFFORTS6.2.1 Conservation in UpstreamSectorMethods adopted by ONGC & OILin the upstream sector includereduction of gas flaring from 11%to 6% of total production from1994-95 to 1998-99, reinjection ofgas into the reservoir andinstallation of waste heat recoverysystems as well as utilization ofnon-conventional energy sourcesand monitoring of all conservationefforts by ONGC and OIL.6.2.2 Conservation ofHydrocarbons in RefineriesThe oil refineries revamp andreplace the low efficiency furnacesand boilers, install heatexchangers, economizers and co-generation equipment etc., apartfrom improved house keeping.6.2.3 Lubricants UpgradationPlanThe refineries have implementedphased action plan to realize thegreat potential to conserve throughquality upgradation of automotivelubricants by production and saleof high grade lubricants of about2.5lakh tones per year in place ofthe erstwhile lower grades.6.2.4 Ocean LossesAs a result of various measurestaken, ocean losses duringtransportation has declined overthe years.6.3 END USERS OF PETROLEUMPRODUCTS AND CONSERVATIONEFFORTSSteps being taken are set out

below:

(i) Transport SectorAdoption of engine design anddriving habits conducive toincreased fuel efficiencysupplemented by trainingprogrammes

(ii) Industrial SectorReplacement of old andinefficient heat apparatus andpromotion of fuel-efficientpractices.

(iii) Agricultural SectorStandardization of fuel-efficient irrigation pump-setsand rectification of existingpump-sets.

(iv) Household SectorDevelopment of fuel efficientappliances & organizingtraining programs with NGOsoperating in Household Sector.

6.4 MULTIMEDIA MASSAWARENESS CAMPAIGNMass awareness campaigns havebeen conducted by the PCRAthrough the media associating theoil companies.6.5 OIL CONSERVATIONFORTNIGHTThe Ministry of Petroleum &Natural Gas, in association withthe Petroleum ConservationResearch Association (PCRA) andall Public Sector Oil companiesunder its ambit, observed the OilConservation Fortnight fromJanuary 17 to 31, 2000,throughout the country, duringwhich over 268,000 activitieswere organized.6.6 PETROLEUM CONSERVA-TION RESEARCH ASSOCIATION6.6.1 The Petroleum ConservationResearch Association (PCRA) wasset up in 1976. It sponsors R&Dcentres for the development offuel-efficient equipment/devicesand organises multi-media

CONSERVATIONS OFPETROLEUMPRODUCTS

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campaigns for creating massenthusiasm for conservation. AConservation Cell was establishedin the Ministry in July, 1989 toreinforce PCRA's efforts.

6.6.2 The highlights of PCRA'sactivities undertaken during theyear are as follows:

(i) Energy Studies168 energy audit studies and314 fuel oil utilization studieswere undertaken during 1998-99.41 energy audit studiesand 241 fuel oil utilizationstudies have been alreadycompleted between April 1999and December 1999. 349small-scale industries werehelped to achieve fuel oilconservation during 1998-99and 1697 follow-up studieswere conducted in theindustries surveyed by PCRA.

(ii) Model Depot ProjectsDuring 1998-99, PCRAcompleted 184 model depotdevelopment studies invarious States across thecountry.

(iii) Driver training programmes324 driver trainingprogrammes have beencompleted during April-December 1999.

(iv) Demonstration clinics/Workshops/Exhibitions830 save fuel clinics/workshops and 31 exhibitionshave been completed betweenApril 1999 and December1999.

(v) Consumer MeetsPCRA organized 18 consumermeets during April-December1999 to bring together energyconsumers, equipmentmanufacturers and energy

consultants to solve theenergy conservation problemsand create awareness.

(vi) Promotional Schemesa) 21 Model garages were set up

during 1998-99 and 18between April and December1999.

b) Testing facility for transitionfrom non-ISI foot valvemanufacture to production ofenergy efficient ISI markedfoot valves is being provided.

(vii) Educational Films/TVSpots/Radio JinglesEducational films and TVspots on themes ofconservation are screened onDoordarshan and broadcaston All India Radio in all theregional languages.

(viii)Outdoor Publicity MediaPCRA's conservation messageswere spread out throughoutthe country by using variouspublicity media.

(ix) Press campaign &Distribution of printedliteraturePCRA's advertisements arereleased in small/ medium /leading publications in everypart of the country. The targetgroups comprised of topexecutives of industries,farmers, drivers, automobileowners, truck/bus drivers,housewives, school/collegestudents etc.

(x) Major R&D ProjectsCompleted During The Year(1998-99)

Industrial Sectora) Design and development of

fuel efficiency monitor for fuelfired furnaces/ boilers.

b) Development of kerosene

vapor recovery system fortextile pigment printing dyingsection.

c) Development of lubedispensing equipment for usein textile industry.

d) Development of softwareprogramme for lubemanagement in textileindustry.

Transport Sectora) Feasibility study and the

development of a prototypeelectric hybrid car.

b) Design / development ofdashboard mounted specificfuel consumption meter forautomobiles.

Domestic Sectora) Development of offset burner

type kerosene pressure stovehaving 65%+ thermalefficiency.

b) Development of LPG canteen/commercial burner having64%+ thermal efficiency .

(xi) On going R&D ProjectsTransport Sectora) Development of fuel injection

system for passenger carengines.

b) Development of energyefficient processes forrecovery/recycling of wastelube oils.

(xii) Additives/ Devices evaluatedPCRA also undertakesevaluation of additives/devicesin the accredited labs toassess their potential forgiving cost effective fueleconomy and emissionreduction. 3 diesel fueladditives were approved forcommercialization and 15 ofgasoline fuel additives and 8.of diesel fuel additives wererecommended for field trials.

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7.1 The orders relating toreservation for the ScheduledCastes/Scheduled Tribes, OtherBackward Classes and PhysicallyHandicapped Persons issued fromtime to time by the Department ofPersonnel & Training , theDepartment of Public Enterprisesand Ministry of Welfare are beingimplemented in the Ministry andall Public Sector Undertakingsunder the administrative controlof the Ministry. The SC/ST Cell ofthe Ministry monitors theimplementation of reservationpolicy. The PSUs have alsoconstituted Implementation Cellsunder the supervision of theirLiaison Officers to safeguard theinterests of SC/ST, OBC andPhysically Handicapped employeesand to redress their grievances.The Liaison Officers of the PSUsare responsible for ensuringimplementation of the PresidentialDirectives as well as the variousorders of the Government.Remedial action on the grievancesof the SC/ST, OBC and P.H.employees of PSUs receivedthrough Members of Parliamentand the Commission for SCs andSTs is taken wherever necessary.

The progress of appointment ofS C / S T / O B C / P h y s i c a l l yHandicapped is monitored by theMinistry during the regularquarterly Performance ReviewMeetings of the PSUs separatelyon the basis of reports receivedfrom them.

7.2 SPECIAL COMPONENT-PLAN(SCP) AND TRIBAL SUB-PLAN(TSP)

In accordance with the Governmentpolicy, all Public SectorUndertakings under theadministrative control of theMinistry have made allocations intheir Annual Plan for the year1999-2000 for various activities

related to the welfare and Economicdevelopment of Scheduled Castesand Scheduled Tribes and weakersections residing in theneighbourhood of projects locationthrough Special Component Plansand Tribal Sub-Plans which are asfollows:-(i) Construction of School/

College Buildings,Scholarship, Adult Education,distribution of teachingmaterial, establishing libraryand other aids to SC/STstudents etc.

(ii) Construction of CommunityLatrines on the lines of SulabhShauchalayas etc. in villagesinhabited mainly by SC/STand weaker sections of society.

(iii) Provision of community healthfacilities, free medical services,medicines through medicalcamps and family planningcamps etc.

(iv) Provision of drinking waterfacility to nearby villagesthrough ring wells/tube wellsetc.

(v) Financial assistance to SC/ST women through co-operative societies forproviding facilities ofhandlooms, weaving etc. toenable them to achieve selfemployment.

(vi) Financial assistance toPhyscially handicappedpersons for rehabilitation.

(vii) Vocational training/guidanceto enable the SC/ST personsto become self-reliant underthe scheme "Earn while youlearn". Trainings are arrangedin various trades, like basketweaving, coir-rope making,sewing, poultry training,fishing, tailoring, typing,motor-driving as well assupply of necessary tools,machines etc.

WELFARE OFSCHEDULED CASTES/SCHEDULED TRIBES,OTHER BACKWARD

CLASSES ANDPHYSICALLY

HANDICAPPED

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(viii) Economic development/selfemployment by organisingentrepreneurship developmenttraining programme.

(ix) Welfare programme such asdistribution of seeds andfertilizers free of cost to needySC/ST farmers anddistribution of smoke-lessChulhas and solar cookers toSC/ST women and alsoconstruction of approachroads and adoption of villagesand

(x) Social forestry schemes likedistribution of fruit bearing

tree, saplings and other plantsetc.

The expenditure incurred by PublicSector Undertakings on the aboveacitivities under "SpecialComponent Plan" and Tribal Sub-Plan" upto 31.12.1999 is asunder:-

(Rs. in lakh)

S. Name of SCP TSP TotalNo. PSU

1. ONGC 40.00 18.00 58.002. IOCL Combined figure 60.333. OIL Combined figure 57.94

4. BRPL 4.53 6.27 10.885. HPCL Combined figure 92.126. CRL Combined figure 14.127. MRL 11.00 � 11.008. LIL 2.50 2.90 5.409. BPCL Combined figure 39.6510. EIL 5.11 10.36 15.4711. Biecco

Lawrie Ltd. Combined figure 0.1512 NRL Combined figure 7.1313. Balmer

Lawrie 6.32 � 6.32

GAIL has allocated Rs.413.89 lakhand IBP has allocated Rs. 20 lakhfor SCP and TSP.

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8.1 Refining industry has beenclassified as one of the majorindustries in the country. Thecompliance with prescribedstandards in respect of liquideffluents and gaseous emissionsis, therefore, a statutoryrequirement. All the refineries inthe country are fully equippedwith adequate pollution controlfacilities to meet the prescribedenvironmental standards andpollution abatement measures areaccorded the top most priority bythe refinery management. Theexisting facilities are reviewed andupgraded as and when requiredand in the case of new projects /process units, actions are taken atthe design stage itself to buildnecessary safeguards and facilitiesfor improving the overallperformance and compliance withthe environmental standards.

8.2 The effluents generated in therefineries can be classified under3 categories viz. i) liquid effluentsii) gaseous emissions and iii) oilysludge. The compliance withrespect to the statutory stipulationswith regard to these as well as theactions taken by the refineries forenvironmental management aresummarised as under :

8.2.1 Liquid Effluents

The water used in the refiningprocess gets contaminated with oiland other pollutants and has to betreated before discharging fromthe refineries. The Governmenthave prescribed Minimal NationalStandards (MINAS) for thedischarge of effluents fromrefineries with respect to criticalparameters, viz., oil and grease,phenols, sulphides, BiochemicalOxygen Demand (BOD), TotalSuspended Solids (TSS). Thestandard also specifies thequantum limits for discharge ofthese pollutants in terms of crudethroughput.

All the refineries in the countryare equipped with full fledgedEffluent Treatment Plants,comprising physical, chemical andbiological treatment facilities forremoval/control of pollutants fromwaste water. The treated wastewater fully meets the prescribedstringent MINAS standards in allthe refineries.

8.2.2 Effluent Reuse

Keeping in view the growingshortage of fresh water, allrefineries have accordedimportance for maximising thereuse of treated effluent withintheir plants and thereby conservingthe fresh water. With this objective,refineries have implementedvarious schemes to reuse part oftheir treated effluent within theirplants in the cooling towers, firewater network, coke cuttingoperations, service water etc. It isworthwhile to mention that treatedeffluent from Mathura refinery andtreated domestic effluent fromGujarat refinery township are beinggainfully used by the local farmers.

8.2.3 Gaseous Emissions

Controlling of gaseous emissions,particularly with respect tosulphur-di-oxide (SO2), is one ofthe major tasks of the refineries.The Government have prescribedstandards for SO2 emissions fromthe three major processing unitsin the refineries in terms of SO2emission per tonne of feedprocessed as well for the boilers inthe Captive Power Plants. Thestipulation for boilers is in termsof minimum stack heightrequirements to minimise theground level concentration of SO2.Further to the above, an overalllimit for SO2 emission from therefineries are also stipulated bythe State Pollution Control Boards/Ministry of Environment & Forests.

All the refineries in the country

CONTROL OFPOLLUTION

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fully comply with the applicableprocess units' SO2 emissionsstandards as well as total SO2emissions limits. The measuresadopted by the refineries forcontrolling SO2 emissions include:

� Use of low sulphur fuel oil

� Desulphurisation of refineryfuel gas in Sulpur RecoveryUnit

� Advanced Process ControlSystems

� Adoption of energyconservation measures forreducing fuel consumptionwhich in turn reducesgaseous emissions

� Taller stacks for betterdispersion of flue gases etc.

8.2.4 Management of Oily SludgeTreatment/disposal of oily sludgegenerated during the refiningoperations is of major concern tothe refineries. Refineries haveadopted various methods likeinstallation of improved mixersfor reducing formation of sludge inthe crude storage tanks and use ofhot gas oil circulation/use ofchemicals for the recovery of oilfrom the tank bottom sludge.Melting pits are used by therefineries to further extract the oilfrom the sludge before its disposal.The treated sludge after gas oiltreatment/melting pits is eitherstored in lined pits or disposedthrough land fill in low lying areasinside the refinery. In some of therefineries like BPCL, HPCL-Mumbaiand MRL, the oily sludge is sold tomicro-crystalline waxmanufacturers approved by theTechnical Evaluation Committeeof MOP&NG.

8.3 MONITORING FACILITIESAll the refineries have full-fledgedenvironmental cells to monitorthe quality of effluents andemissions. Continuous ambient airmonitoring stations / High VolumeSamplers have been provided inand around the refineries tomonitor the level of SO2 and ithas been observed that theemissions are well within thestipulated limits.8.4 ACCREDITATION WITH ISO-14001 ENVIRONMENTALMANAGEMENT SYSTEMIOC-Mathura refinery was the firstrefinery in Asia and one of the fewin the world to achieve thedistinction of ISO-14001accreditation in July, 1996. Sincethen, all the other IOC refineries,namely, Guwahati, Barauni,Gujarat, Haldia & Digboi andBPCL, Mumbai have also gotaccredited with this InternationalEnvironmental ManagementSystem. As regards rest of therefineries in the country, actionshave been initiated by theserefineries for getting thisaccreditation.8.5 FUEL QUALITYIMPROVEMENT8.5.1 Introduction of UnleadedPetrolIn pursuance of the need forreduction of environmentalpollution due to emission frompetrol vehicles, unleaded petrolwas made available in the fourmetros of Delhi, Mumbai, Calcutta,Chennai, the radial routesemanating from these metros andin the city of Agra from April,1995.

With effect from 1.9.1998, the

supply of leaded petrol to theNational Capital Territory (NCT)has been totally dispensed withand only unleaded petrol is beingsupplied and used. Similarly, witheffect from 1.1.1999, only unleadedpetrol is being supplied to theentire National Capital Region(NCR). With effect from 1.2.2000,the entire country would besupplied with unleaded petrol andthe use of leaded petrol in thecountry would be completelydispensed with.

8.5.2 Supply of extra-low sulphurHSDThe sulphur content in High SpeedDiesel (HSD) is a critical attributegoverning the quality of HSD as itcontributes to the particulateemissions from diesel engineexhausts. With a view to improvethe quality of HSD, particularlywith respect to sulphur content,the Government had drawn up amajor programme for reducing thesulphur content in the HSD.

In line with the programme, OilCompanies started supplying HSDwith reduced sulphur content of0.5 % maximum from 1.4.1996 inthe four metros and the Taj-trapezium zone. The sulphurcontent in HSD supplied in theTaj-trapezium zone was furtherbrought down to 0.25 % w.e.f.1.9.1996.

Extra-low sulphur diesel of 0.25 %was introduced in "Delhi Inner"with effect from 15.8.97 and in allthe four metros, viz., Delhi,Mumbai, Calcutta & Chennai from1.4.1998.

With effect from 1.1.2000, theentire country will be suppliedwith extra-low sulphur HSD.

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9.1 PROGRESSIVE USE OFHINDI

9.1.1 The Ministry of Petroleumand Natural Gas is implementingthe provisions of the OfficialLanguage Act, 1963 and Rulesframed thereunder. It is alsoresponsible for the implementationof the Official Language Policy inthe various offices of the PublicSector Undertakings under itsadministrative control.

9.1.2 This Ministry has beennotified under Rule 10(4) of theOfficial Language (Use for OfficialPurposes of the Union) Rules,1976.Three Sections of the Ministry viz.Administration Section, Library andSC/ST Cell have been identifiedunder Rule 8(4) for doing work inHindi. The Establishment Sectionis also required to do all the workin Hindi in respect of group 'C'and 'D' employees. Eleven types ofwork have been identified underthe aforesaid Rule for doing inHindi only. Further, instructionshave been issued under the saidRules to all officers/employees ofthe Ministry who are proficient inHindi, to prepare and submit draftsetc. of the following categories ofcommunications in Hindi only:

(1) All communications to StateGovernments & UnionTerritory Administrations inRegion 'A' and 'B' and alloffices, Undertakings etc. ofCentral Government situatedin these Regions or any personin these Regions.

(2) Replies to all communicationsreceived in Hindi.

(3) Reply to any application,appeal or representationwritten or signed by anemployee in Hindi.

9.1.3 The Ministry has prepared atime-bound programme to impartin-service training to all the

employees who do not possessworking knowledge of Hindi. Underthis programme, 2 officers and 4employees were nominated forProbodh class under the HindiTeaching Scheme during 1999-2000. A time bound programmefor imparting Hindi Stenography/Hindi typing training to theStenographers and Lower DivisionClerks(LDCs) of the Ministry hasalso been prepared, under which 4Stenographers and 6 LDCs werenominated for training.

9.1.4 The first working day ofevery month is observed as 'HindiDivas' in the Ministry. All theofficers/employees are expectedto undertake official work in Hindion that day. The PSUs under theMinistry have also been advised tosimilarly observe 'Hindi Divas' everymonth in all their offices.

9.1.5 The 'Hindi Fortnight' wascelebrated in the Ministry from14th to 28th September,1999 anda number of competitions viz.,Hindi essay competition, Hindinoting-drafting competition andcompetition in dictating inDevnagari, Hindi typing andstenography were organised. 13participants were given cash prizes.

9.1.6 In order to undertake theOfficial Language Implementationwork effectively, an OfficialLanguage ImplementationCommittee (OLIC) is functioning inthe Ministry under thechairmanship of Joint Secretary(Admn.). All the Public SectorUndertakings under the Ministryare members of the Committee.This Committee reviews the overallprogress of implementation of theOfficial Language Policy in theMinistry and the PublicUndertakings as also the progressof implementation of the AnnualProgramme as circulated by theDepartment of Official Language.

GENERAL

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9.1.7 Quarterly progress reportson the progressive use of Hindi aresent to the Department of OfficialLanguage and the quarterlyprogress reports received from thePSUs are reviewed in the OLICmeetings of the Ministry.

9.1.8 The Annual Programme forthe year 1999-2000 (Since 1stApril,1999 to 31st March,2000)which was received from theDepartment of Official Languagewas circulated to all officers of theMinistry & Chief Executives ofPSUs/Offices. The programme wasdiscussed in detail in the meetingof the OLIC of the Ministry. VariousSections in the Ministry and allPSUs were instructed to ensure itsimplementation.

9.1.9 Books, magazines andnewspapers in Hindi are availablein the Library of the Ministry.Help books, such as Administrativeand Technical Terminology inHindi, English-Hindi Dictionariesetc. have been provided to theSections and Desks.

9.1.10 With a view to assessingthe position of compliance ofOfficial Language Rules and theuse of Hindi in the various officesof the PSUs in different parts ofthe country, an Inspection Teamof the Ministry has beenconstituted under theChairmanship of Joint Secretary(Admn.), who is also the Chairmanof OLIC of the Ministry. TheCommittee has inspected 3 officesduring 1999-2000.

9.1.11 For advising the Ministryon matters relating to theprogressive use of Hindi for officialwork and allied issues fallingwithin the framework of the OfficialLanguage Policy laid down by theGovernment of India, the HindiSalahkar Samiti is beingreconstituted under theChairmanship of the Minister of

Petroleum & Natural Gas.

9.1.12 Orders were issued toPublic Sector Oil Companies tocelebrate the Golden Jubilee Yearof Official Language as per theguidelines of the Department ofOfficial Language. The PSUs havechalked out their programmeswhich will be held throughout theyear. On February 4 & 5, 2000, atwo days Seminar was successfullyorganised by Hindustan PetroleumCrop. Ltd. in Pune at the Ministrylevel. Some more such programmeare under consideration.

9.2 ORGANISATION &METHODS

9.2.1 To ensure smooth andsystematic functioning of theMinistry various organisation andmethods programmes are carriedout every year.

9.2.2 Achievements during 1999-2000:

1. Annual Action Plan 1999-2000 for the Ministry wasfinalised and Action TakenReport upto December, 1999sent to the CabinetSecretariat.

2. The Ministry has fixedmaximum time limits fordisposal of 53 items of work.Action to identify more suchitems is in progress.

3. Induction material of Ministrywas updated and printed

4. Guidelines/check list wasdevised for processing theproposal for grant ofhonorarium to employees ofMinistry.

5. Special drive was launchedfor recording, reviewing andweeding of old records during19.7.1999 to 30.7.1999.

6. Study to evaluate the public

grievance redressal machineryof IOC, HPC and BPC wasinitiated. Basic data from thecompanies has been collectedand is being processed.

7. Action in respect of thefollowing items of work hasbeen initiated and theinformation is beingprocessed:

(a) Review of level of disposal/channel of submission ofcases.

(b) Compilation/consolidation oforders/instructions issued bydifferent Divisions of theMinistry.

(c) Bringing out Manual of Acts/Rules/Regulations issued bythis Ministry for easyaccessibility to various oilsector companies.

9.2.3 Pendency position of thework in each Desk/Section ofMinistry was analysed everymonth and submitted toSecretary(P&NG). Analysis of theO&M matters and other importantissues were discussed in fortnightlystaff meeting held under theChairmanship of Secretary(P&NG)and organised by IWSU.

9.3 PROFITABILITY IN OILSECTOR

The profit before tax and the profitafter tax made by the Public SectorUndertakings, under theadministrative control of theMinistry of Petroleum and NaturalGas, during the year 1998-99 wereabout Rs.11330 crore and Rs.8710crore respectively. The profit beforetax and the profit after tax,anticipated during 1999-2000, areabout Rs.11841 crore and Rs.9495crore. The profit before tax andafter tax to be generated by thissector during 2000-2001 areestimated at Rs. 12966 crore andRs. 10223 crore respectively.

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9.4 OUTSTANDING AUDITOBJECTIONS

In the half-yearly statement ofoutstanding paras upto 31/03/99,Audit has shown a total number of25 paragraphs as outstanding.Ministry had already furnishedreplies to Audit. However, finalreply from Audit, on the replygiven by the Ministry, is awaited.

9.5 GRIEVANCES REDRESSAL

A Public Grievances Cell, underthe charge of Joint Secretary(Admn.) who has been nominatedas Director of Public Grievances,is working in the Ministry forattending to the grievances of themembers of public in respect ofthe performance of the Ministryand its Oil Sector PublicUndertakings. The Director ofPublic Grievances is assistedby the Deputy Secretary(Marketing-I). A separateGrievances Cell for redressal of thegrievances of members of staff ofthe Ministry under the chargeof Director (Admn.), is also workingin the Ministry. The jurisdictionof the Directorate of the PublicGrievances set up in the CabinetSecretariat has since beenextended to the Ministry ofPetroleum & Natural Gas.

As on 23.02.2000, the PublicGrievances Cell of this Ministry,has received a total of 458grievances, out of which 225 havebeen disposed of.

The Director of Public Grievancesin the Ministry is empowered tocall for files/papers or thedocuments connected with thegrievances pending for more than3 months in the Ministry and withOil Sector Public Undertakings andto take a decision thereon with theapproval of Secretary, Ministry ofPetroleum & Natural Gas or Headof the Organisation. He can alsocommunicate the final decision tothe aggrieved party. Thecomputerised monitoring of publicgrievance redressal through on-line transmission facility providedby the NIC for reporting the sameto the Prime Ministry's Office andthe Cabinet Secretariat, is alsobeing done by the Ministry.

9.6 FACILITATION COUNTER

With a view to projectingtransparency in the working of theGovernment of India, Ministry ofPetroleum and Natural Gas wasone of the first few GovernmentMinistries/Departments tooperationalise the " InformationFacilitation Counter" on the 30thJune, 1997. This Counter hostsinformation on all aspects of OilIndustry. The Citizens' Charterdrafted by experts of the OilIndustry under the aegis of thisMinistry aims at educating thecommon man about theconsumers' entitlements to publicservices, including the standardsof performance, quality of products,mode of access to information,

simplified procedures for makingcomplaints, the system of time-bound redressal of grievances etc.Besides, information onopportunities for investment inthe Oil and Gas Sector is containedin a separate issue. Further,guidelines on selection of dealers/distributors for Retail Outlets/GasDistributorship/Kerosene Agenciesare also freely given to the visitingpublic. Government of IndiaResolution on phased dismantlingof Administered Pricing Mechanismhas been in great demand.

The Information FacilitationCounter is manned by experiencedpersonnel. During the year 1999,more than 3000 parties haveavailed of this facility either bypersonally visiting this Counter orthrough telephone queries.

In addition to the above, Websitefor the Ministry of Petroleum andNatural Gas initially experimentedon the 5th October, 1999 wasformally launched by the Hon'bleMinister of Petroleum and NaturalGas on the 27th January, 2000.The site has been completelyupdated by modifying the status ofeach petroleum sector. The Hindiversion of the Site is underpreparation.

So far, around 11,525 visitors haveavailed of website information. Thee-mail address of this Counter isfc.png@sb.nic.in. Messages havestarted pouring in through theInter-net also.

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APPENDIX-IWORK ALLOCATED TO MINISTRY OF PETROLEUMAND NATURAL GAS

1. Exploration for, and exploitation of petroleumresources, including natural gas.

2. Production, supply, distribution, marketing andpricing of petroleum, including natural gas andpetroleum products.

3. Oil refineries including Lube Plants.

4. Additives for petroleum and petroleum products.

5. Lube Blending and greases.

6. Planning, development and control, of andassistance to all industries dealt, with by theMinistry.

7. All attached or subordinate offices or otherorganisations concerned with any of the subjectsspecified in the list.

8. Planning development and regulation of oilfieldservices.

9. Public sector projects falling under the subjectincluded in this list. Engineers India Limited

and IBP Company, together with its subsidiaries,except such projects as are specifically allottedto any other Ministry/Department.

10. The Oil fields (Regulation and Development)Act,1948 (53 of 1948).

11. The Oil and Natural Gas Commission Act,1959(43 of 1959).

12. The Petroleum Pipelines (Acquisition of Right ofUser in Land) Act,1962 (50 of 1962).

13. The Esso (Acquisition of Undertakings in India)Act,1974 (4 of 1974).

14. The Oil Industry (Development) Act,1974 (47 of1974).

15. The Burmah-Shell (Acquisition of Undertakingsin India) Act,1976 (2 of 1976).

16. The Caltex (Acquisition of Shares of Caltex OilRefining (India) Limited and of the Undertakingsin India of Caltex (India) Limited) Act,1977

17. Administration of the Petroleum Act,1934 (30 of1934) and the rules made thereunder.

45

APPENDIX-IILIST OF PUBLIC SECTOR UNDERTAKINGS ANDOTHER ORGANISATIONS UNDER THEADMINISTRATIVE CONTROL OF THE MINISTRYOF PETROLEUM AND NATURAL GAS

1. Oil & Natural Gas Corporation Limited.

2. Oil India Limited.

3. Indian Oil Corporation Limited.

4. Bharat Petroleum Corporation Limited.

5. Hindustan Petroleum Corporation Limited.

6. Cochin Refineries Limited.

7. Madras Refineries Limited.

8. IBP Company Limited.

9. Engineers India Limited.

10. Lubrizol India Limited.

11. Bongaigaon Refinery and Petro-chemicals Limited.

12. Biecco Lawrie & Company Limited.

13. Gas Authority of India Limited.

14. Numaligarh Refinery Limited.

15. Balmer Lawrie & Company Limited.

16. O.N.G.C. Videsh Limited.

17. Indian Additives Ltd.(Subsidiary of MRL)

18. Indian Oil Blending Limited (Subsidiary of IOC)

19. Oil Industry Development Board.

20. Oil Coordination Committee.

21. Petroleum Conservation Research Association

22. Oil Industry Safety Directorate.

23. Centre for High Technology.

24. Petroleum India International.

25. Directorate General of Hydrocarbons.

46

APPENDIX-IIII. PRODUCTION OF CRUDE OIL AND NATURAL GAS

1980-81 1990-91 1995-96 1996-97 1997-98 1998-99 1999*(Apr-Dec)

1. CRUDE OIL PRODUCTION ++ ('000' Tonnes)(a) Onshore :

Gujarat 3808 6398 6362 6158 5951 5828 4255Assam/Nagaland 1712 5076 5044 4796 5114 5079 3749Arunachal Pradesh 2 43 28 36 27 38 32Tamil Nadu - 313** 374 330 324 365 283Andhra Pradesh - @@ 44 52 66 85 106

TOTAL (a) 5522 11830 11852 11372 11482 11395 8425of which

AOC 48 @ @ @ @ @ @OIL 1243 2649 2882 2870 3094 3294 2477ONGC 4231 9181 8970 8502 8388 8101 5948

(b) Offshore :ONGC 4985 21191 22665 20183 19863 18286 12890

(c) Private/JVCs - - 650 1346 2514 3042 3015

GRAND TOTAL (a+b+c) 10507 33021 35167 32901 33859 32723 24330

2. NATURAL GAS PRODUCTION(Million Cubic Metres)(a) Onshore :

Gujrat 842 1696 2878 2932 3115 3166 2354Assam/Nagalnd 843 2011 1880 1941 2018 2055 1563Arunachal Pradesh - 29 32 23 24 24 17Tripura - 70 131 154 196 307 268Tamil Nadu - 64 117 92 95 107 98Andhra Pradesh - 46 679 799 1022 1218 1027Rajasthan - - 12 10 148 163 109

TOTAL (a) 1685 3916 5729 5951 6618 7040 5436of which

AOC 38 @ @ @ @ @ @OIL 710 1518 1433 1467 1670 1713 1288ONGC 937 2398 4296 4484 4948 5237 4148

(b) Offshore :ONGC 673 14082 16579 16794 18102 17514 13271

(c) Private/JVCs - - 331 510 1681 2874 2641

GRAND TOTAL (a+b+c) 2358 17998 22639 23255 26401 27428 21348

@ : AOC was merged with OIL w.e.f. 14.10.81* : Provisional- : Nil@@ : Included in Tamil Nadu.** : Includes Andhra Pradesh also.++ : Includes condensates

47

II. REFINERY CRUDE THROUGHPUT ('000' Tonnes)

Refinery 1980-81 1990-91 1995-96 1996-97 1997-98 1998-99* 1999*(Apr-Dec)

(A) PUBLIC SECTOR 25333 51772 58702 59958 61313 64469 50667IOC, Guwahati 639 783 839 848 856 836 668IOC, Barauni 504 2416 2322 1895 2181 2204 2575IOC, Gujarat 6974 9334 10167 10352 10694 10935 7856IOC, Haldia 2308 2835 3416 3451 4706 4714 3059IOC, Mathura 0 7808 8332 8113 8565 8909 6490IOC, Digboi 0 566 559 477 502 553 432IOC, Panipat @@ 0 0 0 0 0 2208 2783BPCL, Mumbai 4901 6957 7460 7640 7996 8878 6479HPCL, Mumbai 3113 5766 5965 6534 6378 5203 4463HPCL, Visakh 1319 3464 5037 4847 2467 3861 3129CRL, Cochin 2912 5006 7421 7293 7729 7770 5891MRL, Chennai 2611 5698 5599 6621 6965 6101 4903MRL, Narimanam 0 0 370 345 556 644 491BRPL, Assam 52 1139 1215 1542 1718 1653 1345NRL, Numaligarh # 0 0 0 0 0 0 103

(B) PRIVATE SECTOR/JVC 503 0 39 2912 3853 4069 10420AOC, Digboi (I) 503 0 0 0 0 0 0MRPL, Mangalore @ 0 0 39 2912 3853 4069 3961RPL, Jamnagar ** 0 0 0 0 0 0 6459

TOTAL CRUDETHROUGHPUT(A+B) 25836 51772 58741 62870 65166 68538 61087

* : Provisional(i) : AOC, Digboi refinery was taken over by the Govt.in Oct. 1981 & merged with IOC.

@ : Commenced Production from 25.3.1996.@@ : Commenced Production from May, 1998# : Commenced Production from April, 1999.** : Commenced Production from July, 1999

48

III. PRODUCTION OF PETROLEUM PRODUCTS ('000' Tonnes)

Products 1980-81 1990-91 1995-96 1996-97 1997-98 1998-99* 1999*(Apr-Dec)

(a) From Crude Oil

I. Light distillates 4101 10023 12433 12883 13032 13776 12431of whichLPG 366 1221 1539 1598 1666 1724 1569Mogas 1519 3552 4462 4704 4849 5573 4381Naphtha 2115 4859 5975 6123 6103 6081 5764Others 101 391 457 458 414 398 717

II. Middle Distillates 12115 26344 29941 32423 33933 36168 31554of whichKerosene 2396 5471 5267 6236 6701 5341 3859ATF/RTF/Jet A-1 1001 1801 2117 2119 214722891625HSD 7371 17185 20661 22202 23354 26716 24508LDO 1108 1509 1351 1286 1246 1336 1152Others 239 378 535 580 485 486 410

III. Heavy Ends 7907 12195 12707 13698 14343 14600 11638of whichFurnace Oil 4041 4879 5351 5980 6771 6407 5026LSFS/HHS/RFLO 2079 4550 4228 4318 4309 4623 3522Lube Oils 426 561 633 619 593 586 515Bitumen 1082 1603 2032 2283 2158 2419 1739Petroleum Coke 86 229 256 246 282 286 235Paraffin Wax @ 49 43 31 27 40 34Other Waxes @ 46 63 56 45 63 51Others 193 278 101 165 158 176 516

Total(I+II+III) 24123 48562 55081 59004 61308 64544 55623

(b) From Natural Gas

LPG - 929 1714 1780 1788 1844 1467

@ : Included in others.* : Provisional.

49

IV. CONSUMPTION OF PETROLEUM PRODUCTS ('000' Tonnes)

Products 1980-81 1990-91 1995-96 1996-97 1997-98 1998-99* 1999*(Apr-Dec)

1. Light Distillates 4388 9801 13144 14384 15742 17509 14741of whichLPG 405 2415 3849 4184 4581 5027 4221Mogas 1522 3545 4679 4955 5182 5511 4386Naphtha 2325 3446 3669 4015 4716 6237 5730NGL 475 682 768 312 72Others 136 395 472 548 495 422 332

2. Middle Distillates 17056 33106 45459 48544 49716 51406 40689of whichKerosene 4228 8423 9317 9646 9878 10583 8028ATF 1125 1677 2082 2158 2108 2097 1608HSD 10345 21139 32254 35019 36071 36887 29537LDO 1122 1506 1311 1223 1235 1260 1126Others 236 361 495 498 424 579 390

3. Heavy Ends 9452 12128 13915 14296 14380 14651 11599of whichFurnace Oil 5406 4462 6496 6534 6651 6482 5281LSHS/HHS 2067 4524 4189 4313 4323 4529 3498Lubes / Greases 593 892 711 705 835 929 641Bitumen 1064 1581 2005 2273 2178 2239 1778Petroleum Coke 137 290 319 276 227 293 238Paraffin Wax 70 76 58 28 31 46Other Waxes 47 57 57 45 74 54Others 185 262 62 80 93 74 63

Total (1+2+3) (Excluding RBF) 30896 55035 72518 77224 79838 83566 67029

4. Imports by private parties 0 0 2152 1944 4452 5796 n.a.

Grand Total (1+2+3+4) 30896 55035 74670 79168 84290 89362 n.a.

* : Provisional.

50

V. IMPORTS/EXPORTS OF CRUDE OIL AND PETROLEUM PRODUCTS(Qty : '000' Tonnes, Value : Rs. Crores)

ITEM 1990-91 1995-96 1996-97 1997-98 1998-99*

Qty. Value Qty. Value Qty. Value Qty. Value Qty. Value

GROSS IMPORTS @

A. Crude Oil 20699 6118.42 27342 11517.00 33906 18538.19 34494 15897.15 39808 14876.46B. Pol. ProductsI. Light Distillates 334 164.26 1117 816.65 1490 1491.83 1422 1162.59 1947 1414.08

1. LPG 329 160.26 678 530.54 1035 1116.86 1087 902.57 1525 1130.352. Others 5 4.00 439 286.11 455 374.97 335 260.02 422 283.73

II. Middle Distillates 8047 4253.60 17950 11155.79 18037 13745.76 17942 11149.97 16308 8203.911. ATF 27 7.98 97 69.45 150 119.69 55 34.23 0 0.002. SKO 3340 1963.37 5001 3325.56 4279 3538.86 3812 2528.77 5823 3244.113. HSD 4680 2282.25 12852 7760.78 13608 10087.21 14075 8586.97 10485 4959.80

III. Heavy Ends 279 242.35 1268 605.41 738 395.90 166 119.36 525 218.531. Furnace Oil 0 0.00 1209 474.55 694 277.38 141 55.31 514 182.852. Lubes 256 207.91 58 130.18 44 118.52 25 64.05 11 35.683. Waxes 23 34.44 Neg 0.68 0 0.00 0 0.00 0 0.00TOTAL(B) 8660 4660.21 20335 12577.85 20265 15633.49 19530 12431.92 18780 9836.52

GRAND TOTAL(A+B) 29359 10778.63 47677 24094.85 54171 34171.68 54024 28329.07 58588 24712.98

EXPORTS @@

A. Crude Oil 0 0.00 0 0.00 0 0.00 0 0.00 0 0.00B. Pol.ProductsI. Light Distillates 2124 847.90 3017 1555.42 2643 1737.07 2098 1276.81 779 417.64

1. Naphtha 1520 621.87 2461 1294.26 2184 1443.83 1407 874.30 643 323.622. LPG (Included

in Others) 17 17.34 22 23.93 21 27.17 23 25.36 25.363. Others 604 226.03 539 243.82 437 269.31 670 375.34 113 68.66

II. Middle Distillates 161 65.96 396 265.50 437 307.38 491 442.16 531 411.221. HSD/LDO 82 31.54 209 138.30 216 148.57 237 212.99 260 197.642. Others 79 34.42 187 127.20 221 158.81 254 229.17 271 213.58

III. Heavy Ends 363 90.06 22 11.01 82 40.33 361 103.87 91 26.851. FO/LSHS 357 88.50 22 10.71 82 40.09 360 103.85 91 26.852. Others 6 1.56 Neg. 0.30 Neg. 0.24 1 0.02 0 0.00

TOTAL (B) 2648 1003.92 3435 1831.93 3162 2084.78 2950 1822.84 1401 855.71

GRAND TOTAL(A+B) 2648 1003.92 3435 1831.93 3162 2084.78 2950 1822.84 1401 855.71

NET IMPORTS

A. Crude Oil 20699 6118.42 27342 11517.00 33906 18538.19 34494 15897.15 39808 14876.46B. Pol.Products 6012 3656.29 16900 10745.92 17103 13548.71 16580 10609.08 17379 8980.81

GRAND TOTAL 26711 9774.71 44242 22262.92 51009 32086.90 51074 26506.23 57187 23857.27

@ : Includes NOC imports but excludes import by private parties.* : Provisional.@@ : Includes supplies of POL products to Nepal upto September 1999.Neg : Negligible.

Shri Ram Naik, Hon�ble Minister of Petroleum & Natural Gas addressing the distinguished guests during the valedictoryfunction of Oil Conservation Fortnight 2000

MINISTRY OF PETROLEUM & NATURAL GASSHASTRI BHAVAN,

DR. RAJENDRA PRASAD ROAD,NEW DELHI-110001

PH. : 3383692. FAX : 91-11-3383585