Indian Petroleum Industry Research

INDUSTRY RESEARCH: INDIAN PETROLEUM

INDUSTRY

2010

I N T E R N A T I O N A L S C H O O L O F B U S I N E S S & M E D I A ; K O L K A T A

ABHIJIT SAMANTA

P/MN/R/09/167

2

TABLE OF CONTENT TOPIC PAGE NO

CHAPTER 1: INTRODUCTION

1.1 Introduction 3

1.2 Uniqueness of petroleum industry 3

1.3 No. of players 3

1.4 Market Share 4

1.5 Contribution to Indian Economy 5

CHAPTER 2: INDUATRY DYNAMICS

2.1 Products and Services offered 6

2.1 Performance of petroleum and natural gas sector 6

2.2 Crude oil production 7

2.3 Natural gas production 8

2.4 Coal Bed Methane (CBM) 8

2.5 Production and consumption of petroleum products 8

2.6 Import of crude oil 9

2.7 Import and Export of petroleum products 10

2.8 Country wise export of petroleum products 11

2.9 Import of natural gas through pipeline 12

2.10 LPG as Auto fuel 12

2.11 Conservation of petroleum products 12

2.12 Earnings of public sector undertaking 13

2.13 Refinery Capacity Utilization 14

2.14 Fuel Production 15

2.15 Industrial Consumption of petroleum products 15

2.16 Consumption of fuel 16

2.17 Difference in production and consumption of various fuels 17

2.18 Trends in Prices 18

CHAPTER 3: OUT LOOK

3.1 Trends in Prices 18

3.2 Financial Performance 19

3.3 Contribution to Employment 20

3.4 Social Welfare 20

3.5 Employment Scenario 21

LIST OF ANNEXURES

Annexure 1 22

Annexure 2 22

Annexure 3 23

Annexure 4 24

Annexure 5 25

Annexure 6 26

Annexure 7 27

Annexure 8 28

Annexure 9 29

Annexure 10 30

3

Indian Petroleum Industry

Introduction:

The petroleum industry for any underdeveloped, developing and developed county is very critical

and important. The various important function of this industry is exploration, extraction, refining,

transporting and obviously marketing of various petroleum products. Fuel Oil and Gasoline (Petrol)

are the most important products of this industry. For the production of various pharmaceutical

products, fertilizers and chemical products etc. petroleum is also used as the raw material.

If we analyze the world’s energy consumption pattern we get a much clear picture about the

importance of petroleum for any nation. On a total scale the world consumes 30 billion barrels (4.8

km3) of oil per year on an average. All the developed and the developing nations are the largest

consumer of this consumption. The consumption pattern for various areas is like South and Central

America (44%), Africa (41%). North America (40%). The US consumes almost 25% of World’s total

production. 1

Uniqueness of Petroleum Industry:

The petroleum industry is such an industry which has the largest earning capacity. The various

petroleum products are diversified in a very wide range. The main functional areas of this industry

are extraction of crude, refining of crude, processing and transporting.

The main problem faced by the entire petroleum industry is the pollution problem. The refining of

crude oil creates huge pollution by producing various harmful gases. Another problem is of drilling

mud. When the drilling work is done a huge amount of crude, water, soil mixture gets wasted. Here

innovative and upgraded technology is required to minimize the wastage of petroleum.

The leakage and drainage problems are also one of the major barriers in case of refinery work. Good

piping technology and proper drainage system is also very essential in this industry. One thing we

must appreciate that India has very limited production of petroleum in comparison with demand

scenario. In this condition the wastage is a critical issue which must be addressed properly.

No of Players:

For India the corresponding body with the responsibility of exploration, production of oil and natural

gases, their refining, distribution, marketing, import, export and conservation of various petroleum

products and natural gases is the “MINISTRY OF PETROLEUM & NATURAL GAS”. There are various

public sector and other organizations under the ministry of petroleum & natural gas that are mainly

responsible for all the above mentioned functions. These are listed below. These are the main

1 http://en.wikipedia.org/wiki/Petroleum_industry

4

players in this industry. For all the organizations The Government of India also have respective

shares which are also listed below.

No. Name of Organization Govt. of India Share

1 Oil & Natural Gas Corporation Ltd. 74.14%

2 Indian Oil Corporation Ltd. 78.92%

3 Hindustan Petroleum Corporation Ltd. 51.11%

4 Bharat Petroleum Corporation Ltd. 54.93%

5 GAIL (India) Ltd. 57.34%

6 Engineers India Ltd. 90.40%

7 Oil India Ltd. 98.13%

8 Biecoo Lawrie & Co. Ltd. 57.13%

9 Balmer Lawrie Investments Ltd. 59.67% 2

Market Share:

The various organizations have their respective market share. We take the “Refinery Throughput” of

various companies to express their market share. Year 2009 data shows that the maximum market

share was captured by Indian Oil with 31% share. Then the Reliance Industry with 22% share. All the

industries maintained almost the same market share in last three years i.e.: 2009, 2008 and 2007.

The complete data of refinery throughput for various companies are given Annexure 1.

2 Ministry of Petroleum: Annual Report 2008-2009. http://www.petroleum.nic.in/

Indian Oil31%

Reliance Industries22%Hindustan

Petroleum10%

Bharat Petroleum13%

Chennai Petroleum6%

Mangalore Refinery & Petrochemicals

8%

Numaligarh Refinery1%

Bongaigaon Refinery & Petrochemicals

1%

Essar Oil8%

Market Share: Refinery Throughput 2009

http://www.petroleum.nic.in/

5

Contribution to Indian Economy:

Various companies for crude oil and natural gas production are having a significant importance in

Indian Economy. In terms of GDP also the production for crude oil and natural gas also has very

contribution.

If we look to the above chart then we can see that the sales growth for crude oil and natural gas

industry is very high in certain years in has even cross a growth of 50%. In last five years the growth

is very significant and it is maintained.

The PAT (Profit after Tax) is in decline mode since 2007. In 2009 it has witnessed a negative growth.

But the result for PAT margin is very good. It has always been very high since 1993.

Now if we look to the GDP figure (at factor cost) and market capitalization of petroleum products

and their percentage. In 1993 it was only 0.27% not even 1% contribution was there. But in last

3 CMIE Data Base: Business Beacon and IAS.

Sales Growth of Crude Oil & Natural Gas Companies

PAT Growth of Crude Oil & Natural Gas Companies

PAT Margin of Crude Oil & Natural Gas Companies

GDPfc (at constant 1999-00 prices)

Market Capitalisation of Petroleum Products Scrips

Market Capitalization to GDP %

Year Per cent Per cent Per cent Rs.crore Rs.crore

1993 51.2 13.3 16.8 1158025 3169 0.27%

1994 77.3 190.2 27.5 1223816 14200 1.16%

1995 -9.7 12.2 12.6 1302076 20814 1.60%

1996 12.2 -3.7 14.8 1396974 18416 1.32%

1997 0.5 4.7 15.4 1508378 19141 1.27%

1998 14.9 30.2 17.5 1573263 25195 1.60%

1999 -1.4 1.3 16.9 1678410 28761 1.71%

2000 -0.2 34.1 22.6 1786526 56317 3.15%

2001 20.3 43.2 26.6 1864301 50333 2.70%

2002 -4.6 18.3 32.8 1972606 84821 4.30%

2003 47.7 65.1 37.2 2048286 79003 3.86%

2004 -7.7 -12.3 35.5 2222758 183782 8.27%

2005 52 42 32.7 2388768 167271 7.00%

2006 8.6 9.9 32.8 2616101 222966 8.52%

2007 16.1 10.9 31 2871118 301846 10.51%

2008 6.6 6.2 30.8 3129717 499682 15.97%

2009 13.5 -1.4 28 3339375 374702 11.22%

Co-relation between GDP and Market Capitalization of Petroleum products. 0.942284 3

6

three years it just crossed 10%. In 2007, 2008, 2009 respectively it was 10.51%, 15.97%, 11.22% by

these figures the implication of petroleum industry over the Indian economy is very clear.

One more important thing is the co-relation between GDP and Market Capitalization of Petroleum

Products. The co-relation is 0.942284 almost 1.00. This means the GDP figures and Petroleum

products capitalization are very highly co related.

Industry Dynamics:

Products / Services Offered:

The main products of this industry are petroleum and natural gas. Now there are various products

under petroleum that are produced. Some of them are

Liquefied Petroleum Gas

Superior Kerosene

Aviation Turbine Fuel

Motor Spirit

High Speed Diesel

Light Diesel Oil

Naphtha

Furnace Oil/LSHS

Bitumen and Asphalt

Lubricating Oil

At the time of refining the various products gets separated from the main crude oil at different

pressure and temperature depending on their density. The natural gas is also one of the key

components of the petroleum production.

Performance of Petroleum & Natural Gas Sector:

The efficient and reliable energy supplies take very important role for maintaining a good growth

level of the Indian Economy. The petroleum and natural gas takes a very vital role in this energy

generation. The share of oil and gas in the energy consumption is about 45%.

The entire picture will be clearer after analysing the statistics of crude oil and natural gas production.

7

Crude Oil Production:

The crude oil production in 1981 was

258.36 lakh tonnes. The growth story

started and in 2001 it reached a

production of more than 1000 lakh

tonnes. This particular year witnessed a

growth of 20.33 %.

Once again in the year 2007 the growth

was 12.64 % with a total production of

1465.51 lakh tonnes. In last two years we

witnessed a comparatively lesser growth.

In last year i.e. 2009 the total production

was 1607.72 lakh tonnes with a growth of

2.99% over the year 2008.

The constant increase of the green line in

the production column shows the

constant improvement of the crude oil

production.

4

4 CMIE Data Base: Business Beacon and IAS

Crude Oil Production Statistics

Lakh tonnes

Year Crude Oil Production Growth

1981 258.36

1982 301.46 16.68%

1983 331.56 9.98%

1984 352.63 6.35%

1985 355.56 0.83%

1986 429.1 20.68%

1987 454.77 5.98%

1988 477.54 5.01%

1989 488.03 2.20%

1990 519.43 6.43%

1991 517.72 -0.33%

1992 514.23 -0.67%

1993 534.82 4.00%

1994 542.96 1.52%

1995 565.34 4.12%

1996 587.41 3.90%

1997 628.7 7.03%

1998 651.66 3.65%

1999 685.38 5.17%

2000 859.64 25.43%

2001 1034.44 20.33%

2002 1072.74 3.70%

2003 1125.59 4.93%

2004 1218.4 8.25%

2005 1274.16 4.58%

2006 1301.09 2.11%

2007 1465.51 12.64%

2008 1561.03 6.52%

2009 1607.72 2.99%

8

Natural Gas Production:

During 2008-2009 natural gas production was 32.85 billion cubic metre (BCM) and for this period the

target was 36.94 BCM. The data shows that there is an achievement of 89% of the target. For the

next fiscal year the targeted production is 52.116 BCM, an increase of 15.176 BCM. The ministry of

petroleum also forecast that the natural gas production will be doubled by the end of eleventh Five

Year Plan. The growth trend is shown in the following table.

Natural Gas Production Statistics:

Period Year Natural Gas Production (BCM) % Groth

1 2001-02 29.714

2 2002-03 31.389 5.64

3 2003-04 31.962 1.83

4 2004-05 31.763 -0.62

5 2005-06 32.202 1.38

6 2006-07 31.747 -1.41

7 2007-08 32.417 2.11

8 2008-09 32.850 1.34 5

Coal Bed Methane (CBM):

The coal bed methane (CBM) is a good subsititute of natural gas. The main advantage of this

substitute is that it an environment friedly fuel. The government already took a step in 1997 to

increase the production of this CBM. The first production in July 2007 of CBM was about 6800 cubic

meters per day. As of now the production is 72000 cubic meters per day showing a growth of 958 %

growth in last 12 years.

The entrire operation is done by maintaining various blocks for the production of CBM. The

production centres are mostly located at Assam, Chattrisgarh, Madhya Pradesh, Maharastra, Orrisa

and Tamil Nadu.

Production and Consumption of petroleum products:

Presently the production of petroleum produc is 152.68 million metric ton (MMT). There is an

increse of 3.87% than of the last fiscal year’s data. Currently the consumption is 133.400 MMT there

is also a growth of 3.45% in case of consumption.

The production and consumption pattern is given in the follwing chart.

5 Source: Ministry of Petroleum: Annual Report 2008-2009. http://www.petroleum.nic.in/


9

Production and Consumption of petroleum products:

Year Production of Petroleum Products (MMT)

% Growth Consumption of Petroleum Products (MMT)

% Growth

2001-02 102.209 100.432

2002-03 106.510 4.21 104.126 3.68

2003-04 115.783 8.71 107.751 3.48

2004-05 120.819 4.35 111.634 3.60

2005-06 121.935 0.92 113.213 1.41

2006-07 137.353 12.64 120.749 6.66

2007-08 146.990 7.02 128.946 6.79

2008-09 152.680 3.87 133.400 3.45 6

Import of Crude Oil:

Financial year 2008-09 shows that import of crude oil has been 128.16 MMT. In last financial year

the import was about 121.672 MMT. This shows an increase of 5.33% in quantity terms. Further

analysis of the import data shows that the total growth of import of crude oil is 63% starting form

2001-02 and continuing up to 2008-09.

In value terms total import of crude oil in 2008-09 was valued at Rs. 3,41,887 crore. This figure for

the financial year 2007-08 was Rs. 2,72,699 crore. The increase is of 25.37%.

For details of figures see annexure 2 7



0

20

40

60

80

100

120

140

Import Of Crude Oil

Imports of Crude Oil (MMT)

Avarage Crude Oil Price (Indian Basket) (US$/bbl.)



10

Import and Export of petroleum products:

The import and export of petroleum products is done on two bases.

1. In value terms i.e. Rs.

2. In quantity terms i.e. MMT (Million Metric Tonne)

Looking toward the graphs we can see that there is always a growth in import of petroleum

products. In value terms the import in the year 1992 was of 13112312 lakh and this import in the

year 2009 was 41937894 lakhs. Starting from 2005 to 2009 the import of petroleum products

maintained a huge growth. The average growth rate was 34.93% for this period. We started export

of the petroleum products only in the year of 2001. The export in this year was of 20241.18 lakh, the

export also maintained a good growth in last few years. In 2009 the export was of 4785554.89 lakhs.

In 2003 the export growth was very high in comparison to the export of last year. In 2003 it

witnessed a growth of 13092 %. However the average growth rate of petroleum products is

significantly good. For complete data of the above information refer to annexure 3.

Now if we look to quantity terms in financial year 2001-02 the import was 7.009 Million Metric

Tonne (MMT) this import in financial year 2008-09 was 18.285 MMT. We witnessed a negative

growth in the last financial year’s petroleum products import. However in 2005-06 the growth in

import was very high around 52 %. The scenario for the export is also very good. In financial year

2001-02 it was 10.065 MMT and in 2008-09 it was 36.931 MMT. Here we also witnessed a negative

growth. For details of data refer to annexure 4.

8

8 Source of information: CMIE data IAS.

0

5000000

10000000

15000000

20000000

25000000

30000000

35000000

40000000

45000000

19

92

19

93

19

94

19

95

19

96

19

97

19

98

19

99

20

00

20

01

20

02

20

03

20

04

20

05

20

06

20

07

20

08

20

09

Inport, Export of petroleum products (In value)

Petroleum product import

Petroleum product export

11

9

Country wise export of petroleum products:

The maximum export happens to UAE and Iran. Every country wise also the export grows over every

year. Mainly the export happens to UAE, Iran, Singapore, USA, Brazil, Indonesia, Sri Lanka and Japan.

Last year almost for every county the export of petroleum products witnessed a negative growth

rate except USA, UAE and Brazil. For USA the growth over 2008 was very high, it was 187.40 % and

over UAE and Brazil it was 18.66 % and 37.82 % respectively. For details refer to Annexure 5.

10

9 Source of information: Ministry of Petroleum, Annual Report 2008-09.

10 Source of information: CMIE Database: IAS.

05

1015202530354045

Import & export of petroleum products (In quantity terms)

Imports of Petroleum products (MMT)

Export of petroleum products (MMT)

0

500000

1000000

1500000

2000000

2500000

Jan-07 Jan-08 Jan-09

R

s

L

a

k

h

Country wise export

UAE

Iran

Singapore

USA

Brazil

Indonesia

Sri Lanka

Japan

12

Import of Natural Gas through gas pipeline:

The India-Pakistan-India (IPI) project was taken in 2005 regarding the gas pipeline for import

of natural gas. This project was signed with Pakistan and Iran government.

The Govt. of Turkmenistan, Afghanistan and Pakistan also made one proposal for export of

natural gas. They approached India for being a partner of this project. Successfully India

became a partner of this project in 2008. The total length of this pipeline is 1680 km. In

Turkmenistan the length is about 145 km, in Afghanistan it is 735 km and in Pakistan it is 800

km.

LPG as auto fuel:

One of the major problems faced by our government is the pollution problem which is mainly caused

by various petroleum products. One of the major of them is using diesel as Auto fuel. The exhaust

created after burning in two stroke auto engines is very much polluting for the atmosphere.

This major issue is solved by taking a great measure: using LPG in Autos as fuel. Initially the

permission was not there for using LPG Auto fuel but later on Govt. made necessary legislation work

to make LPG as compulsory fuel in Auto. By this step the pollution problem has been controlled in a

great way.

Honourable Supreme Court has mandated conversion of old vehicles to LPG / CNG in cities which are

equally or more polluted than Delhi and as per Honourable Court, the critically polluted cities are

Ahmadabad, Agra, Bangalore, Chennai, Hyderabad, Kanpur, Kolkata, Lucknow, Mumbai, Pune, Surat

and Sholapur.

Conservation of Petroleum products:

The high and impressive growth of the Indian economy has generated a huge growth in terms of

Aggregate Demand for the various petroleum products. In the present scenario the situation is such

that we have to depend on the import of petroleum products to meet our every day requirement.

Then there is another issue of sharp growth of world petroleum prices. All these issues compelled

the Indian Govt. to rethink or re strategies the conservation policy of petroleum products.

There is a scope of reducing energy consumption by 20% to 25% in our country through

conservation measures. As we have millions of consumers in our country any savings attempt by any

individual will affect a great measure if cumulative calculation is done.

The transport sector has become a major consumer of petroleum products which has put a heavy

pressure on the quality of environment. Apart from better quality of existing petroleum fuels, the

use of less polluting fuels like Hydrogen and blending of Biodiesel and Ethanol are some of the steps

which have the potential to control the impact on the environment.

13

Petroleum Conservation Research Association (PCRA) takes major steps in this regard. It has taken

various steps to ensure proper utilization of petroleum products and also minimizing the wastage. By

its very practical R&D approach it advises various industries about how to control the consumption

and also takes necessary steps to monitor the whole fact.

Earnings of public sector undertakings:

The profit after tax (PAT) is maximum for ONGC and the GOI also makes a good share from many of

the organizations. The PBT and PAT for various public sector organizations is shown in the chart

below.

Name of PSU Profit Before Tax

Profit After Tax %of GOI Holdings as on 31.03.2009

2008-09 2008-09

ONGC 23914.96 16126.31 74.14

OVL 5366.5 2806.7 NIL

IOC 4328.59 2949.55 78.92

GAIL 4204.02 2803.7 57.34

HPCL 712.23 574.98 51.11

OIL 3386.97 2161.68 98.13

BPCL 1004.11 735.9 54.93

CPCL -593.11 -397.28 NIL

MRPL 1811.66 1192.54 NIL

NRL 319.59 235.65 NIL

EIL 520.47 344.53 90.40

BALMER LAWRIE 151.56 101.61 NIL

BIECCO LAWRIE 2.7 2.56 57.37

TOTAL 45130.25 29638.43 11

11

Source of information: Ministry of Petroleum.

14

Refinery capacity utilization:

The refinery capacity utilization in last three financial years shows that Mangalore Refinery &

Petrochemicals is having the highest capacity utilization in 2007, 2008, and 2009. The performance

of Indian Oil and Hindustan Petroleum is also good. Reliance Industries witnessed a major decrease

in terms of capacity utilization in the year 2009 over the last year’s performance. However the

performance of Essar Oil shows a major growth in capacity utilization in the year 2009 over last

year’s performance. For details of capacity utilization data refer to Annexure 6.

12

12

Source of information: CMIE Database: IAS

0

20

40

60

80

100

120

140

Refinary Capacity Utilization, Companywise (%)

2007

2008

2009

15

Fuel Production:

The various fuel products that are produce major of them are LPG, Superior Kerosene, Aviation

Turbine Fuel, Motor Sprit, High Speed Diesel Oil, Light Diesel Oil. Among all of them the maximum

production happened for LPG. The following graph shows also the significant growth in every fuel

products production. In comparison to other products the LPG production is maximum. Presently

Govt. is taking measures to maximize the LPG production because in modern transportation industry

the utilization of LPG / CNG is very high for its pollution controlling capacity.

In the year 2005 the growth for LPG production is maximum with 46.01%. In 2004 the growth for

Aviation Turbine Fuel witnessed a maximum figure with 40.58%. In current year it witnessed a

negative growth.

However for complete data of fuel production refer to Annexure 7.

13

Industrial Consumption of petroleum products:

The data starting from 2001 to 2009 for petroleum products consumption shows that the maximum

consumption happened for Naphtha Products. I n2001 the consumption was 9908 thousand tonnes

and in 2009 it was 14828 thousand tonnes. Year 2005 witnessed a maximum growth in consumption

with almost 26%. The next highly consumed is Furnace Oil. In 2001 the total consumption was 6478

13


0

10000

20000

30000

40000

50000

60000

70000

Fuel Production, 000 tonnes

LPG

Superior Kerosene


Motor Spirit

High Speed Diesel Oil

Light Diesel Oil

16

thousand tonnes and in 2009 it was 14750 thousand tonnes. It witnessed a maximum growth in the

year 2005 with almost 20% growth.

But the story of low Sulphur heave stock is completely different the year wise consumption of this

particular product is continuously decreasing. In other words it witnesses a negative growth in terms

of consumption. For all the other products consumption there is significant growth in terms of

consumption.

However for the complete data of industrial consumption of various petroleum products refer to

Annexure 8.

14

Consumption of fuel:

Analyzing the consumption pattern starting from the year 2000 to 2009, the highest consumption

occurred for LPG. In the year 2000 the consumption for LPG was 6421 thousand tonnes and in 2009

it was 12193 thousand tonnes. The maximum growth in terms consumption occurred in the year

2008 with 12.08% in last 10 years.

After LPG the maximum consumption occurs in case of Superior Kerosene. In 2000 the consumption

was of 11898 thousand tonnes and in 2009 it was 9303 thousand tonnes. The maximum growth in its

consumption in last 10 years happened in 2006 with 1.55%. Here the growth pattern is not very high

for every individual year. In last 10 years only in 2006 it witnessed a positive growth. Otherwise in

14


0

2000

4000

6000

8000

10000

12000

14000

16000

18000

Industrial Consumption of petroleum producs , 000 tonnes

Naphtha Production '000 tonnes

Furnace Oil Production '000 tonnes

Low Sulphur Heavy Stock Production '000 tonnes

Bitumen and Asphalt Production '000 tonnes

17

every other year it witnessed a negative growth. This also shows good symbol for economy of a

country because here it shows that either we are using good substitutes for the energy or we are

being sincere in case of consumption.

For the complete data of consumption of various fuels refer to Annexure 9.

15

Difference in production and consumption of various fuels:

The most important fuel for any economy is the production of kerosene products and the LPG. If we

compare the production and consumption of various fuels over the period of 2001-2009. We can see

that for LPG the production always been less than of the consumption. So for every year we need to

import the LPG. The scenario is same for Superior Kerosene also.

In 2001 the minimum import requirement was of 3060 thousand tonnes. This figure in the year 2009

was of 3035 thousand tonnes. Superior Kerosene minimum import requirement in 2001 was of 2593

thousand tonnes and in the year 2009 it was 1080 thousand tonnes. But these two figures shows

good result as the minimum import requirement reduced over the years.

15


0

10000

20000

30000

40000

50000

60000

Consumption of fuel, 000 tonnes

Liquefied Petroleum Gas

Superior Kerosene


Motor Spirit

High Speed Diesel

Light Diesel Oil

Naphtha

Furnace Oil/LSHS

Bitumen and Asphalt

Lubricating Oil

18

But for the other fuels like ATF, Motor Spirit, High Speed Diesel Oil, Light Diesel Oil is completely

different here the production of our country is always being higher than of our consumption, this

show a surplus of these fuels over every year. Now this surplus our Govt. uses as a tool for the

export of fuels. The surplus for ATF in 2001 was of 263 thousand tonnes and in 2009 it was 3616

thousand tonnes. That shows a huge growth.

For motor spirit in 2001 the surplus was of 1458 thousand tonnes and in 2009 it was of 4762

thousand tonnes. That also shows a huge growth.

These figures are also very good for High Speed Diesel Oil. In 2001 it was of 1057 thousand tonnes

and in 2009 it was of 11220 thousand tonnes.

However for complete data of this difference refer to Annexure 10.

Chapter 3 - Out Look:

Trends in Prices:

The trend in Domestic and international prices is shown in the data table below. The crude oil prices

got maximum increase in the financial year 2005-06 with a growth of 42.11%. The petrol price

witnessed a maximum growth in the financial year 2004-05 with 39.87%. In case of diesel the

maximum price increased witnessed 2004-05 with 54.36%. In case of Kerosene the maximum growth

in prices occurred in 2004-05 with 59.14%. LPG witnessed a growth of 36.79% in price in financial

year 2007-08. In recent past that is financial year 2008-09 LPG did not witnessed any growth

(0.66%).

TRENDS IN INTERNATIONAL AND DOMESTIC PRICES

Period Crude Oil

(Indian Basket) %

Gro

wth

Petrol

% G

row

th

Diesel

% G

row

th

Kerosene

% G

row

th

LPG

% G

row

th

$ / Bbl. $ / Bbl. $ / Bbl. $ / Bbl. $ / MT

2001-02 23.31 26.43 23.27 23.65 194.00

2002-03 26.65 14.33% 30.04 13.66% 28.86 24.02% 29.24 23.64% 279.67 44.16%

2003-04 27.97 4.95% 35.01 16.54% 30.39 5.30% 31.11 6.40% 277.02 -0.95%

2004-05 39.21 40.19% 48.97 39.87% 46.91 54.36% 49.51 59.14% 368.57 33.05%

2005-06 55.72 42.11% 64.51 31.73% 64.70 37.92% 69.43 40.23% 481.04 30.52%

2006-07 62.46 12.10% 72.62 12.57% 74.12 14.56% 77.03 10.95% 499.67 3.87%

2007-08 79.25 26.88% 90.76 24.98% 92.91 25.35% 94.33 22.46% 683.49 36.79%

2008-09 83.57 5.45% 89.42 -1.48% 101.75 9.51% 104.37 10.64% 688.00 0.66%

19

16

Financial Performance:

The entire petroleum industry financial performance is shown in the following table. The data is

given starting form 2000 and up to 2009. Analyzing the entire data we can see that the sales growth

for the last year was 24.5% which was in 2008 14.6%, this shows a good change in the total sales

growth. In 2002 we witnessed a negative growth in sales.

There is also a significance growth in expenses. In 2009 the expense grew with 25.6% compared to

13.5% of last year i.e. 2008. In 2002 it witnessed a negative growth.

In last 10 years the maximum PAT growth occurred in 2003 with 121% last year we witnessed a

negative growth of 23.6%.

In last year i.e. 2009 the PAT margin grew at 2.5% however in 2004 the PAT margin witnessed a

maximum growth of 5.8% in 2004.

17

16

Source of information: Ministry of Petroleum, Annual Report 2008-09. 17

Source of information: CMIE Data Base: IAS

Financial Performance of petroleum industry

Year

Sale

s G

row

th

Exp

en

ses

Gro

wth

PB

DIT

Gro

wth

PA

T G

row

th

Exp

en

ses

To

Sal

es

Rat

io

Oth

er

Inco

me

To

To

tal

Inco

me

Rat

io

Extr

a O

rdin

ary

Inco

me

To

Tota

l In

com

e R

atio

Extr

a O

rdin

ary

Exp

en

ses

To

Tota

l In

com

e R

atio

PB

DIT

Mar

gin

PA

T M

argi

n

% % % % % % % % % %

Mar-00 40.6 47.5 4.4 -2.1 102.8 0.6 0 0 6.2 2.6

Mar-01 26.2 20.9 3.3 3 98.4 1 0.1 0 5.1 2.1

Mar-02 -19.8 -19.6 -10.1 -29.6 97.8 1.1 0.3 0 8.1 2.8

Mar-03 25.7 27.6 60.6 121 99.3 1.4 0.1 0 10.3 4.9

Mar-04 10.2 6.3 18.2 31.5 95.8 1.5 0 0.1 11.1 5.8

Mar-05 23.7 25.8 -2.4 -1.7 97.4 1.1 0 0 8.8 4.6

Mar-06 25.5 27.7 -6.8 -9 99.1 0.9 0 0 6.5 3.4

Mar-07 21 20 36.6 26.5 98.2 1.4 1 0.2 7.3 3.5

Mar-08 14.6 13.5 13.6 24.4 97.1 0.7 0.8 0.6 7.6 4

Mar-09 24.5 25.6 -2.7 -23.6 97.9 0.9 0.1 0.1 5.9 2.5

20

Contribution to Employment:

This industry not only take significant part in case making profit and fulfilling energy requirement of

our country but also it take significant role in case employment generation. With a view to deal with

gender sensitization and to promote the cause of women empowerment, special programmes are

organized focusing on their professional development and welfare activities. These include external

and in-house training, programmes on women health, sponsoring them to attend the National Meet

of the Forum of Women in Public Sector etc.

In other words the Ministry of Petroleum not only take significant role in case of generating the

employment for male people but it also contribute to employment of women as well and by doing

this the overall human development also occurs.

Social Welfare:

The Ministry of Petroleum takes significant role in doing various social welfare activities and

generating employment for the socially backward and physically backward people.

In the recuitment precedure of various PSUs of this industry there is always a vacant position in their

requrement criteria for the socially backward class. The maximum befit is given by the EIL in terms of

reservation.

The data given below shows the kind of benefits the PSUs offers to socially backward and physically

backward people in terms of employment.

SC / ST / OBC / PH vacancies information by various PSUs.

No of backlog reserved vacancies (Direct Recruitment)

PSU Group A

Group B

SC / ST OBC / PH SC / ST OBC / PH

Balmer Lawrie nil 5 nil 2

OIL 2/0 nil 2/0 nil

EIL 44/58 107/33 nil 0/1

BPCL 0/2 44/28 nil nil

NRL 10/0 19/0 nil nil

IOC nil nil nil nil

GAIL nil 66/1 0/4 25/2

HPCL 61/40 77/4 nil nil

ONGC nil nil nil nil

BRPL 1/0 4/0 nil nil

21

18

Employment Scenario:

The IOCL is the highest no of employment provider in financial year 2008-09. The total employment

statistics till 2009 is 32472 employees as total and for female the no is 2527. Then the position is of

ONGC. HPCL, BPCL are also huge no of employment provider.

However the industry also looks forward for the further generation of huge no of employment in

future. Various measures have already been taken and some are on progress status. In next few

years these PSUs will be a huge no of employment generating bodies.

Sl. No Name of PSU Total No. of Employee Total no. of women employees

1 ONGC 32002 1974

2 IOCL 32472 2527

3 HPCL 11255 767

4 BPCL 14059 1181

5 GAIL 3544 174

6 EIL 3028 332

7 OIL 8374 325

8 CPCL 780 49

9 BRPL 1638 77

10 NRL 777 36

11 MRPL 1255 57

12 BIECCO LAWIRE 437 5

13 BALMER LAWRIE 1422 92

14 ONGC (V) 200 8 19

18

Source of information: Ministry of Petroleum, Annual Report 2008-09. 19

Source of information: Ministry of Petroleum, Annual Report 2008-09.

CPCL nil 0/1 1/3 1/3

BIECCO LAWRIE LTD. 0/1 5/0 0/1 0/1

MRPL nil 0/7 nil nil

22

Annexure:

Annexure 1

Source of Information: CMIE Data Base: IAS

Annexure 2:

year Imports of Crude Oil (MMT)

% Growth

Average Crude Oil Price (Indian Basket) (US$/bbl.)

% Growth

2001-02 78.706 22.75

2002-03 81.989 4.17% 26.59 16.88%

2003-04 90.434 10.30% 27.98 5.23%

2004-05 95.861 6.00% 39.21 40.14%

2005-06 99.409 3.70% 55.72 42.11%

2006-07 111.502 12.16% 62.46 12.10%

2007-08 121.672 9.12% 79.25 26.88%

2008-09 128.155 5.33% 83.57 5.45%

Source of Information: Ministry of petroleum: Annual Report 2008-09.

Refinery throughput company wise Lakh Tonnes

Year 2007 2008 2009

Indian Oil 440.01 474.01 492.04

Reliance Industries 366.16 369.31 356.36

Hindustan Petroleum 167.96 168.18 158.07

Bharat Petroleum 139.58 208.8 200.01

Chennai Petroleum 104.02 102.66 101.36


125.36 125.25 125.77

Numaligarh Refinery 25.04 25.68 22.51


20.67 20.2 21.63

Essar Oil 17.63 66.31 129.13

23

Annexure 3:

Petro products import & export (In value terms)

Rs.lakh

Year Petroleum product import

% Growth Petroleum product export

% Growth

1992 1312312

1993 1714200 30.62%

1994 1804513 5.27%

1995 1861255 3.14%

1996 2517360 35.25%

1997 3562872 41.53%

1998 3034119 -14.84%

1999 2691913 -11.28%

2000 5464860 103.01%

2001 7149652 30.83% 20241.18

2002 6676986 -6.61% 7376.15 -63.56%

2003 8536700 27.85% 973112.74 13092.69%

2004 9452000 10.72% 1140240.72 17.17%

2005 13409400 41.87% 1947384.07 70.79%

2006 19464000 45.15% 2740953.43 40.75%

2007 25840271 32.76% 4785554.89 74.59%

2008 32054718 24.05% 5998138.12 25.34%

2009 41937894 30.83% 5787135.82 -3.52%


24

Annexure 4:

Petro products import & export (In quantity terms)

Year Imports of Petroleum products (MMT)

% Growth

Export of petroleum products (MMT)

% Growth

2001-02 7.009 10.065

2002-03 7.228 3.12% 10.289 2.23%

2003-04 8.001 10.69% 14.62 42.09%

2004-05 8.828 10.34% 18.211 24.56%

2005-06 13.44 52.24% 23.461 28.83%

2006-07 17.66 31.40% 33.624 43.32%

2007-08 22.462 27.19% 40.779 21.28%

2008-09 18.285 -18.60% 36.931 -9.44%

25

Annexure 5:

Country wise export

Mar-01 Mar-02 Mar-03 Mar-04 Mar-05 Mar-06 Mar-07 Mar-08 Mar-09 % Growth over 2008

UAE 13740.6 2687.56 192792.31 152319.5 230615 616363.6 1637912.8 1823101 2163218 18.66%

Iran 8.61 134.32 142624.42 410193.8 834527 937811.7 1519223.7 1612369 1597415 -0.93%

Singapore

677.5 2644.73 123926.96 10469.02 132555 248929.9 353830.92 547206 479055 -12.45%

USA 61.46 51.62 94891.33 101338.9 133640 67899.58 252835.96 96047.81 276042 187.40%

Brazil 4.37 744.13 167188.59 211552.6 298033 165372.8 244875.46 343670.8 473640 37.82%

Indonesia 662.4 776.59 103878.23 87771.74 86593 322002.3 128702.91 270298.5 69295.5 -74.36%

Sri Lanka 1194.76 280.54 27705.53 8102.6 1774.98 3389.51 80838.77 69172.74 16669.9 -75.90%

Japan 3772.07 31227.61 31368.67 69607.2 92860.14 192878.37 480186.7 99725.6 -79.23%

Thailand 97.5 47.16 65979.52 124986.1 138562 276243 318059.23 441178.4 335546 -23.94%

Taiwan 21.87 9.5 22898.24 2137.77 21476.3 10080.96 56396.73 314907.9 276529 -12.19%


26

Annexure 6:

Refinery Capacity Utilization Per cent

Year Indian Oil

Reliance Industries

Hindustan Petroleum

Bharat Petroleum

Chennai Petroleum


Numaligarh Refinery


Essar Oil

1981 75.63 88.64 93.25 5.2

1982 73.08 93.22 100.04

45.3

1983 87.19 84.02 102.04

59.6

1984 95.16 88.02 94.54

64.9

1985 100.58 55.86 60.95

75.2

1986 101.65 87.92 90.3

89.3

1987 97.89 87.26 92.71

74.89

1988 102.53 90.77 91.63

82.15

1989 90.16 92.68 97.79

86.37

1990 96.44 100.35 98.39

89.93

1991 97.3 92.3 101.75

84.37

1992 99.57 86.49 98.73

86.22

1993 99.64 103.76 81.89

82.67

1994 100.79 104.66 83.63

86.44

1995 102.5 102.48 104.33

87.33

1996 104.42 110.02 85.27

51.7

1997 102.39 113.81 99.51 97.07

65.62

1998 107.02 88.45 107.44 128.43

73.11

1999 95.77 90.64 96.36 110.27

70.34

2000 91.07 44.12 81.25 100.19 53.66 7.17 81.06

2001 92.04 96.42 92.15 94.64 66.44 48.37 63.32

2002 88.5 109.83 94.98 95.56 56.63 76.9 62.77

2003 88.33 113.13 99.45 90.92 74.85 62.63 62.26

2004 94.27 113.52 105.38 93.87 103.91 73.33 90.47

2005 88.58 103.97 109.53 84.98 121.87 68.07 98.34

2006 93.16 100.49 109.45 85.82 98.69 123.98 71.1 100.26

2007 92.93 110.96 129.2 116.32 99.07 129.37 83.47 87.96 50.65

2008 100.11 111.91 129.37 107.08 97.77 129.26 85.6 85.96 63.15

2009 103.92 57.48 121.59 102.57 96.53 129.79 75.03 92.04 122.98


27

Annexure 7:

Fuel Production

Year Mar-01 Mar-02 Mar-03 Mar-04 Mar-05 Mar-06 Mar-07 Mar-08 Mar-09

LPG 4088 4779 4902 5349 7810 7708 8436 8792 9158

% Growth 16.90% 2.57% 9.12% 46.01% -1.31% 9.44% 4.22% 4.16% Superior Kerosene 8714 9682 10027 10188 9299 9074 8491 7794 8223

% Growth 11.11% 3.56% 1.61% -8.73% -2.42% -6.42% -8.21% 5.50% Aviation Turbine Fuel 2512 2595 3051 4289 5201 6196 7805 9106 8071

% Growth 3.30% 17.57% 40.58% 21.26% 19.13% 25.97% 16.67% -11.37%

Motor Spirit 8071 9698 10361 10997 11019 10501 12539 14167 16019

% Growth 20.16% 6.84% 6.14% 0.20% -4.70% 19.41% 12.98% 13.07% High Speed Diesel Oil 39015 39774 40113 43265 45882 47560 53466 58360 62888

% Growth 1.95% 0.85% 7.86% 6.05% 3.66% 12.42% 9.15% 7.76%

Light Diesel Oil 1481 1704 2079 1660 1546 922 804 671 607

% Growth 15.06% 22.01% -20.15% -6.87% -40.36% -12.80% -16.54% -9.54%


28

Annexure 8:

Industrial Petroleum Product Consumption

Year Naphtha Production

& Growth

Furnace Oil Production

& Growth

Low Sulphur Heavy Stock Production

& Growth

Bitumen and Asphalt Production

& Growth

'000 tonnes

'000 tonnes

'000 tonnes

'000 tonnes

Mar-01

9908 6478 4913 2721

Mar-02

9180 -7.35% 7488 15.59% 4741 -3.50% 2562 -5.84%

Mar-03

9650 5.12% 7529 0.55% 4638 -2.17% 2940 14.75%

Mar-04

11316 17.26% 8735 16.02% 4636 -0.04% 3396 15.51%

Mar-05

14314 26.49% 10517 20.40% 4261 -8.09% 3348 -1.41%

Mar-06

14668 2.47% 10286 -2.20% 3852 -9.60% 3576 6.81%

Mar-07

16658 13.57% 12324 19.81% 3328 -13.60%

3891 8.81%

Mar-08

16438 -1.32% 12647 2.62% 3111 -6.52% 4510 15.91%

Mar-09

14828 -9.79% 14750 16.63% 2935 -5.66% 4712 4.48%


29

Annexure 9:

Consumption details of various fuel: 000 tonnes '000 tonnes

Year Mar-

00 Mar-

01 Mar-

02 Mar-

03 Mar-

04 Mar-

05 Mar-

06 Mar-07 Mar-

08 Mar-

09

LPG 6421 7148 7728 8351 9304 10245 10456 10854 12165 12193

% Growth 11.32% 8.11% 8.06% 11.41% 10.11% 2.06% 3.81% 12.08% 0.23%

Superior Kerosene 11898 11307 10432 10405 10231 9395 9541 9505 9365 9303

% Growth -4.97% -7.74% -0.26% -1.67% -8.17% 1.55% -0.38% -1.47% -0.66%

Aviation Turbine Fuel 2197 2249 2256 2269 2481 2811 3296 3983 4543 4455

% Growth 2.37% 0.31% 0.58% 9.34% 13.30% 17.25% 20.84% 14.06% -1.94%

Motor Spirit 5909 6613 7011 7570 7896 8251 8647 9286 10332 11257

% Growth 11.91% 6.02% 7.97% 4.31% 4.50% 4.80% 7.39% 11.26% 8.95%

High Speed Diesel 39295 37958 36546 36644 37075 39651 40191 42896 47669 51668

% Growth -3.40% -3.72% 0.27% 1.18% 6.95% 1.36% 6.73% 11.13% 8.39%

Light Diesel Oil 1512 1399 1592 2063 1619 1476 883 720 667 552

% Growth -7.47% 13.80% 29.59% -

21.52% -8.83% -

40.18% -18.46% -7.36% -

17.24%

Naphtha 10892 11679 11728 11929 11868 13993 12194 13886 13294 13875

% Growth 7.23% 0.42% 1.71% -0.51% 17.91% -

12.86% 13.88% -4.26% 4.37%

Furnace Oil/LSHS 6816 7664 8451 8027 8313 9136 8921 9257 9469 9267

% Growth 12.44% 10.27% -5.02% 3.56% 9.90% -2.35% 3.77% 2.29% -2.13%

Bitumen and Asphalt 2879 2714 2584 2986 3373 3337 3508 3833 4506 4705

% Growth -5.73% -4.79% 15.56% 12.96% -1.07% 5.12% 9.26% 17.56% 4.42%

Lubricating Oil 1243 1043 1137 1250 1426 1347 2081 1900 2290 2149

% Growth -

16.09% 9.01% 9.94% 14.08% -5.54% 54.49% -8.70% 20.53% -6.16%


30

Annexure 10:

Fuel Production and Consumption Difference 000 tonnes

Year Mar-

01 Mar-

02 Mar-

03 Mar-

04 Mar-

05 Mar-

06 Mar-

07 Mar-

08 Mar-

09

LPG

Production 4088 4779 4902 5349 7810 7708 8436 8792 9158

Consumption 7148 7728 8351 9304 10245 10456 10854 12165 12193

Difference -3060 -2949 -3449 -3955 -2435 -2748 -2418 -3373 -3035

Superior Kerosene

Production 8714 9682 10027 10188 9299 9074 8491 7794 8223

Consumption 11307 10432 10405 10231 9395 9541 9505 9365 9303

Difference -2593 -750 -378 -43 -96 -467 -1014 -1571 -1080

Aviation Turbine

Fuel

Production 2512 2595 3051 4289 5201 6196 7805 9106 8071

Consumption 2249 2256 2269 2481 2811 3296 3983 4543 4455

Difference 263 339 782 1808 2390 2900 3822 4563 3616

Motor Spirit

Production 8071 9698 10361 10997 11019 10501 12539 14167 16019

Consumption 6613 7011 7570 7896 8251 8647 9286 10332 11257

Difference 1458 2687 2791 3101 2768 1854 3253 3835 4762

High Speed Diesel Oil

Production 39015 39774 40113 43265 45882 47560 53466 58360 62888

Consumption 37958 36546 36644 37075 39651 40191 42896 47669 51668

Difference 1057 3228 3469 6190 6231 7369 10570 10691 11220

Light Diesel Oil

Production 1481 1704 2079 1660 1546 922 804 671 607

Consumption 1399 1592 2063 1619 1476 883 720 667 552

Difference 82 112 16 41 70 39 84 4 55


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