Essar Oil Limited

Analyst Presentation
April 16,
16 2010

Essar Oil-E&P Highlights

g g
1

Received Competent Persons Reports (CPR) for 4 most promising blocks ; Ratna, Raniganj, Rajmahal and Nigeria

Emerging as a significant player in CBM in India with low risk, significant demand and better fiscal regime

Raniganj & Rajmahal 2C & prospective CBM resources: 993 BCF & 4.7 TCF respectively

Execution of off take Agreement with Matix Fertilizers and Chemicals for supply of 2.8
2 8 mmscmd for 20 years

Nigeria PSC executed in March, 2010; plans are under way to farm out 37% in favour of local partner;

Nigeria has shown great potential with 2C and best estimate prospective resource of ~ 126 mmboe

Trail production of gas from raniganj to commence by Q2 CY2010 & Commercial Production to start by Q4 CY 2010.

Total Reserve portfolio increased to ~1400 mmboe ; 2C & prospective resource 1162 mmboe & unrisked
resource 238 mmboe

Essar Oil Refiningg and Expansion

p
Project
j Highlights
g g
1

Achieved throughput of 3.60 MMTPA for the quarter and 13. 50 MMTPA for the year

76 % of the crude processed was Heavy or Ultra Heavy, helping strengthen refining margins

Commenced supply of BS IV grade HSD and BS III grade MS to OMCs

Natural Gas ( 1 mmscmd) usage and Mangla Crude (20 30 kbpd) processing to commence in this quarter.
quarter

Refinery Expansion Phase I on track, scheduled for mechanical completion by March, 2011 - Overall progress of 53%

Achieved 729 days of Lost Time Incident Free operation, equivalent to 13.19 million safe man-hours

Won British Safety Council International Award for 2009 5th award for EOL for Health Safety and Environment

Awarded second position, CII-SHE Award 2009, in the manufacturing (Large) category in the Western Region

Essar Oil Marketingg Highlights

g g
1

1338 retail outlets operational all over India, with addition of around 50 retail outlets in the last quarter

Focus on Gujarat and Western India due to sales tax and logistics advantages

Captured 7.53 % market share in MS and HSD retail in Gujarat; currently in the process of adding Auto LPG facilities in the ROs

73% of sales (by value) in the domestic market in the quarter; 75% in the year

Captured 13% share of bitumen market in India; commissioned the packed bitumen sales in this quarter

Increased the number of supply locations in India to 25, lowering the cost of placing products in far-away markets

Retail Sales for the quarter Rs. 676 crore the year ( FY 2010 - Rs 2875 crore & Qty - 0.8 MT)

Essar Oil Financial Highlights

g g
1

Essar Oil clocked Turnover of Rs. 42402 crore for the year 2009-10; EBIDTA Rs 1935 crores; GRM 4.38 $/ bbl

Net Profit for year 2009-2010 is Rs. 29 crore, as against loss of Rs 514 crore for 2008-09

For quarter ending March-2010: Turnover of Rs. 11941 crore; EBIDTA Rs 680 crores; GRM 5.12 $/ bbl

Net Profit for Quarter ending March-2010 is Rs 179 crore as against a loss of Rs 226 crore in Quarter ending Dec-09

Equity Infusion of Rs 2000 Crores committed by promoters & tie up of Debt of Rs 4600 crore for Phase I Refinery Expansion
Project, completed

Essar Energy plc, holding company of Essars refinery, E&P and power businesses, to list at London Stock Exchange

Part of proceeds will be utilized for refinery expansion, E&P activities and corporate purpose

CEOs Message
g
Refining margins have bottomed out in this quarter and are expected to be higher in
coming quarters boosted by demand from emerging economies.
Per capita oil consumption in India set to rise with growth in Indian economy, increase
in per capita income, growth in vehicles and Govt. focus on infrastructure spending.
India will remain the anchor market for Essars expanded capacity and the company
will
ill continue
ti
t augmentt its
to
it retail
t il network
t
k to
t realize
li the
th opportunities
t iti available
il bl in
i
Indian Market
Going forward,
forward E&P business is expected to emerge as a major value creator for the
company

Strongg India GDP ggrowth outlook

is expected to drive among the fastest GDP growth rates in
the world

India has low GDP per capita

1.6%

1.4%

4.8%

3.1%

10.0%

7.1%

GDP (re
eal) growth rate
(2009 2014)

46,400

GDP perr capita

(PPP terms) 2009 (US$)

GDP growth rate

(2000
2009)

32,700

15,200
10,200

7.5%

3.6%

3.5%
2.4%

2.3%

UK

US

6,500
3,100

USA

EU

Russia

Brazil

China

India

Source: CIA World Factbook, International Monetary Fund

Total

160

68

140

80

97

100

40
20

India

32
21
26

Brazil

Russia

supporting private sector growth

149

% infrastructure spending by private sector

51

24.4%

47

16 0%
16.0%

30.1%
(US$154bn)

41

80
60

120

CAGR: 22%

120

China

Source: International Monetary Fund, World Economic Outlook Database, October 2009

Increased government spending levels

US$bn (at 2006 2007 prices)

9.6%

25

19.8%
(US$43bn)

39
33

29

21

26

32

2007 08

2008 09

2009 10

Energy

Transportation

40
2010 11

51

25.8%

Note: Energy includes electricity and gas

Transportation includes roads, ports, railways & airports
Others includes telecom, irrigation, water & storage

2011 12

IIndian
di G
Govt.
t X Plan
Pl
(FY03 FY07)

IIndian
di G
Govt.
t XI Plan
Pl
(FY08 FY12)

Others
Source: Projections of Investment in Infrastructure during the Eleventh Plan available on http://www.infrastructure.gov.in/

Increasingg oil and ggas consumption

p
Low per capita oil consumption

Low per capita gas consumption

Per capita g
gas consumption
(annual cubicc feet/person) - 2008

1.9%

Per capita oil consu

umption (annual
barrels/person
n) 2008

23.1

11 0
11.0
7.3
4.4
2.2

USA

EU

Russia

Brazil

0.9

China

0.8%

0.7%

9.8%

18.9%

6.9%

4.5

2.1

1.2

Brazil

China

India

105.7

75.3

35.1

Russia

India

USA

EU

Source: KBC
Note: Figures in ovals represent gas consumption CAGR (2003 2008).
Source: BP Statistical Review of World Energy June 2009, CIA World Factbook

Source: BP Statistical Review of World Energy June 2009, CIA World Factbook

Strong potential uplift from vehicle ownership

as India catches up with developed countries

120

16.0

100
12.0

80

8.0

60
40

4.0

20

0.0

0
2000

2010
GDP per capita

Source: KBC

2020

2030

Cars p
per '000 drivers

900

140

Cars per '0

000 drivers

GDP per cap

pita (US$' 000)

20.0

2005

2030

800
German

700

UK

Japan

600
500

S Korea

400

Brazil
Russia

300

China
Thailand

200
100

Kuwait

Pakistan

India

0
1,000

Car ownership

10,000

100,000

GDP US$2004 (PPP)

Source: KBC

Industryy Trends
$12

16%
13.90%*

14%

MS Growth

HSD Growth
11.30%
11.10%

12%

6%

4.30%

6.80

8.80%

7.40%
6.90%

8.50%

6.70%

8.70%*

4.50%

2%

$6
4.95

$4

4.80%

4%

Light-Heavy
Light
Heavy Price Diffrential
(Arab Light -Arab Heavy)

8.45

$8

10%
8%

10.00

$10

4.35

2.65

$2

1.70

2.20

1.20

1.55

1.40%

1.20%

1.50

$0

0%
2003-04

2004-05

2005-06

2006-07

2007-08

2008-09

*As per IPR

Gasoil

Apr - Feb.
09-10

FO

Jet

Gasoline

$12

11.2

10.1
8.0
9.0

6.2
7.6

7.6

6.9

92
9.2

7.3
8.8

7.0

6.9

$7
8.2

6.2

7.8
5.9

6.0
5.6

6.9

7.2

7.0

7.7

6.3

6.5

8.8
7.5

8.2

10.2
10.5

6.3

6.2

3.5

$2

2.2

2.9

-1.9
-2.9

8.7

-2.3

-2.1

$(3)
-4.0

-4.5

-3.3

-7.6

-4.9

-5 4
-5.4

-4.9

-5.4

Mar-10

Feb-10

Jan-10

Dec-09

Nov-09

Oct-09

Sep-09

Aug-09

Jul-09

Jun-09

May-09

Apr-09

$(8)

Essar Oil Limited

A world-class, low cost Indian integrated energy company
Exploration & Production

Refining

High impact E&P platform

Low cost refining complex centred around

Vadinar supersite

Marketing

Pan India Presence through Retail Network

Capitalise on Indias rapidly growing energy demand

9

Exploration & Production

10

A high
g impact,
p , Indian-led E&P p
platform
Mehsana(a)
70% interest (ESU)
2P reserves: 2mmbbl ((oil))
Potentially significant CBM play

Rajmahal(b)
100% interest in CBM block
Best estimate p
prospective
p

Vietnam(e)
100% interest in block 114
Unrisked/undiscovered in
in-place
place

resources: 4.7tcf CBM gas

(787mmboe)
CPR by ARI (2010)

resources: 1.0tcf gas (167mmboe)

Nigeria(c)(e)
100% interest in offshore block OPL

226 in discussion with local

partner to farm down to 63%
p
2C and best estimate prospective
resources (based on 63% interest):
126mmboe (f) (48% oil)
CPR by NSAI (2010)
Other Assets

Assam ((e)) (100% interest):

Unrisked/undiscovered in-place
resources: 10mmboe (oil)

Mumbai Offshore (e) (50% interest):

Unrisked/undiscovered in-place
resources: 186bcf (31mmboe)

Indonesia (e) (49.5% interest):

Unrisked/undiscovered in
in-place
place
resources: 30mmbl (oil)

Madagascar(e)

Australia(e)

Ratna /R Series(d)
50% interest
2C resources: 81mmboe (92% oil,

8% gas)
Commercial production: Q4

CY2013((d))
Expected gross peak production:
35kbbl/d
CPR by RPS Energy (2010)
Note: Reserves and resources data is working interest, adjusted to reflect Essar Oils interest
(a)
Signed PSC for Oil; CBM rights subject to government approval and modification in government policy
(b)
Provisional winner, formal award awaited
( )
(c)
Si
Signed
d PSC
(d)
PSC expected to be signed by June 2010, which is subject to a government approval process
(e)
Subject to necessary approval for transfer to Essar Oil
(f)
c.22mmboe (2C) of gas classified as development not viable
(g)
Relates to 2C and best estimate prospective resources
Source: Company information

Raniganj(c)
100% interest
2C and best estimate prospective

resources: 993bcf CBM gas

(165mmboe)
Trial production: Q2 CY2010
Expected gross peak production:
3.5mmscm/d (g)
CPR by NSAI (2010)

2P reserves/ 2C and prospective resources

Unrisked/undiscovered in-place resources

11

Details of E&P blocks with reserves and resource estimates

Best estimate prospective
resources(a)

2C resources(a)

Unrisked in-place resources(a)

Oil

Gas

Total

Oil

Gas

Total

Oil

Gas

Total

Comments

Ownership

mmbbl

Bcf

mmboe

mmbbl

Bcf

mmboe

mmbbl

Bcf

mmboe

Capex(i)
(US$mm)

Ratna/ R-Series (b)(j)

Discovered fields.
Development to commence
post signing of PSC

50%(e)

74

40

81

568

$5.3/bbl

35k
bbl/d

)(j)
Raniganj (CBM)((c)(j)

Test production commenced.

Moving to commercial
development

100%

201

33

792

132

439

$0.43/
mmbtu

3.5(p)
mmscm/d

Potentially significant CBM

play

70%(f)

2(m)

Nigeria(c)(j)(o)

Located in proven Nigerian

petroliferous basin

63%(k) (q)

11

136

33

49

264

93

16

Rajmahal (CBM) (d)(j)

Large
g acreage.
g Situated in
rich coal belt

100%

4 723
4,723

787

Assam(l)

Close to discovered oil area

100%(q)

10

10

13

Potential shallow gas play

50%(h) (q)

186

31

Located in proven Central

Sumatra basin

49.5%
49
5%(g) (q)

30

30

Large acreage and

considered highly prospective

100%(q)

1,000

167

87

377

150

49

5,779

1,012

40

1,185

238

1,055

Assets

Mehsana

(j)

Mumbai Offshore
Indonesia((l))
Vietnam(l)
Total
(a)
(b)
(c)
(d)
(e)
(f)
(g)
(h)
(i)
(j)
(k)
(l)
(m)
(n)
(p)
(q)

(l)

Opex

Peak
Prodn.

Working interest,
interest adjusted to reflect Essar Oils
Oil s interest
RPS Energy CPR (2010)
Netherland Sewell & Associates Inc. CPR (2010)
Advanced Resources International CPR (2010)
For Ratna / R-Series, balance 50% is held by ONGC (40%) and Premier Oil (10%)
For Mehsana (ESU oil field), balance 30% ownership is held by ONGC. Essar Oils interest in the rest of the block is 100%
For Indonesia, balance 50.5% ownership is held by GSPC
For Mumbai Offshore, balance 50% ownership is held by Noble Energy
Capex for Ratna & R-series fields and Raniganj CBM blocks are for the full field development (net share of Essar Oil)
Mehsana - signed PSC for Oil; CBM rights subject to government approval and change in government policy; Rajmahal provisional winner, formal award awaited; Raniganj PSC signed; Nigeria - block awarded, PSC signed
Ratna - PSC expected to be signed by June 2010 (subject to government approval process)
In discussion with local partner to farm down to 63%
Essar Oil estimates
2mmbl of 2P reserves (Essar Oil estimate)
c.22mmboe of gas classified as development not viable
Relates to 2C and best estimate prospective resources
Subject to necessary approvals for transfer to Essar Oil

12

Essar Energy
gy Exploration
p
& Production
High impact E&P platform

Key highlights

Reserves & resources (mmboe)(b)

238
17%
Oil
Gas

1,012
5%

83%

95%

(a)
(b)

Diverse portfolio of offshore and onshore oil & gas blocks

Emerging as a significant player in Indian natural gas(a)(b) - lower risk

and with significant
g
demand and excitingg growth
g
profile
p

Ratna 2C resources: 81mmboe (92% oil, 8% gas); commercial

production expected Q4 2013; gross peak production: 35kbpd

Raniganj 2C and best estimate prospective resources: 993bcf (CBM

gas); operational 2010; gross peak production: 3.5mmscm/d

M h
Mehsana
2P reserves: 2mmbl
2
bl (oil)
( il)

Rajmahal Best estimate prospective resources: 4.7tcf (CBM gas)

International and other domestic Unrisked/in-place resources of

over 238 mmboe

1,400
13%

87%

150
58%
42%
2P and 2C Best estimate Unrisked/
contingent prospective inplace
resources
resources
resources

Total
resources

Total investment to date c.US$160mm

Coal Bed Methane gas from three blocks Raniganj,

Raniganj Rajmahal and Mehsana
Subject to necessary approvals. Please refer to E&P slides for further details

Source: Company information, ARI, RPS Energy, NSAI

13

Leadingg p
private Indian gas
g player
p y
Gas reserves and resources

25
23 0
23.0

20

(tcf)

15

10

5.9
5
2.1
1.0

0.2

0
Reliance
Industries (a)

Essar Energy (b)

Niko
Resources (a)

Great Eastern
Energy (c)

Indus Gas (a)

(a) Wood Mackenzie working interest commercial and technical gas reserves for India
(b) Includes Rajmahal (4,723bcf), Raniganj (993bcf), Mumbai Offshore (186bcf), Ratna (40bcf) working interest 2C and best estimate prospective resources
(c) As per broker research (RBC 9-Nov-09) working interest remaining reserves
Source: Company information
information, RPS Energy
Energy, ARI and NSAI (for Essar Energy)
Energy), Broker research (for Great Eastern Energy),
Energy) Wood Mackenzie (for Reliance Industries
Industries, Niko Resources and Indus Gas)

14

Ratna/R-Series Fields gross peak production of nearly

,
barrels per
p dayy
35,000
Field overview

Resources

Offshore block, located 90km southwest of Mumbai

81mmboe (net to Essar Oil) of 2C resources (92% oil),
CPR by RPS Energy (2010)

Interest

Essar Oil (50%) , Premier Oil (10%), ONGC (40%) #

Current status

35 exploration and 9 development wells drilled

previously by ONGC
Awaiting signing off PSC and
d related
l d agreements

Key milestones

Government take
and pricing

Government profit share varies, depending on capex

spend and recovery of the capex
FOB prices at delivery point as per market

40

Capex to full
development

Equity invested to date: US$3.0mn

Capex to full development: c.US$568mn (Essar share)
to be funded 70/30 debt/equity

35
30

Opex guidance

US$5.3/bbl

Capex guidance and

phasing

CY 2010 : c.US$9mn
US$9
(net
( t share)
h )
CY 2011 : c.US$27mn (net share)
CY 2012 : c.US$79mn (net share)

Other

API 32 45
Cost/well: US$11 12mn

Evacuation

40km pipeline to be laid to connect to existing pipeline

Customer

Government nominated PSU

25
20
15
10
5
0
FY12
2
FY13
3
FY14
4
FY15
5
FY16
6
FY17
7
FY18
8
FY19
9
FY20
0
FY21
1
FY22
2
FY23
3
FY24
4
FY25
5
FY26
6
FY27
7
FY28
8
FY29
9
FY30
0
FY31
1
FY32
2
FY33
3
FY34
4
FY35
5
FY36
6
FY37
7
FY38
8
FY39
9
FY40
0
FY41
1
FY42
2
FY43
3

Gross produc
ction (Kbp/d)

Gross production profile

PSC/JOA and off-take agreement expected to be signed

by June 2010 (subject to government approval process)
Commercial production expected in Q4 CY 2013(a)

(a) Assuming PSC signing by June 2010

Source: Company information, RPS Energy

15
# Premier Oil is currently Operator under terms of award. The Joint Venture parties have discussed in good faith to implement a joint operatorship model post execution of PSC subject to requisite approval

Raniganj low risk development to serve customers in

Eastern Indias ggas deficit industrial belt
Field overview

Resources

Onshore block, located in Damodar Valley coal field in

the Raniganj region of West Bengal
993bcf (165mmboe) of 2C and best estimate
prospective resources (CBM
(
gas),
) CPR by NSAI ((2010))

Interest /
operator

100% interest, Essar Oil is operator

Current status

17 information wells 15 test wells drilled; gas flow

started
Awaiting approval of development plan

Key milestones

500 wells to be drilled over the life of the asset

Trial production sales planned for Q2 CY2010
Commercial production expected by December 2010

Royalty at the rate of 10% of well

well-head
head price is payable
to the government of West Bengal. Production level
payments (PLP) linked to a percentage of revenue are
also payable to the Government of India, based on a
formula

Capex to full development: c.US$439mn

$
to be funded 70/30 debt/equity
capex figure reflects estimated expenditure for
both 2C and prospective resources

Opex guidance

US$0.43/mmbtu

Capex guidance and

phasing

CY 2010 : c.US$97mn (net share)

CY 2011 : c.US$131mn (net share)

Other

Cost/well: US$0.63mn

Evacuation

Pipeline being built

Customers

Philips Carbon, Matix Fertilizers already signed up

Government take
and pricing

Production profile
Capex to full
development

4.0

Production (mm
mscm/d)

3.5
3.0
2.5
20
2.0
1.5
1.0
0.5
FY09
9
FY10
0
FY11
FY12
2
FY13
3
FY14
4
FY15
5
FY16
6
FY17
7
FY18
8
FY19
9
FY20
0
FY21
FY22
2
FY23
3
FY24
4
FY25
5
FY26
6
FY27
7
FY28
8
FY29
9
FY30
0
FY31
FY32
2
FY33
3
FY34
4
FY35
5
FY36
6
FY37
7
FY38
8
FY39
9
FY40
0
FY41
FY42
2

0.0

Note: FY ended March 31st. Production profile reflects both 2C and best estimate prospective resources
Source: Company information, NSAI

16

Refining & Marketing

17

Vadinar refineryy

18

Operational Performance
Ultra Heavy

Crude Processed
15.00

13.50

26%

27%

31%

60%

52%

13%

17%

QE0309

QE1209

QE0310

Export

PSUs

80%

9.00

Light

100%

11 95
11.95

12.00

Heavy

27%

28%

60%
46%

6 00
6.00
3.31

3.51

40%

3.60

3.00

20%

0.00

0%

QE0309

QE1209

QE0310

FY-09

FY-10

51%

57%

28%

22%

15%
FY- 09

FY-10

100%

Heavy

Distillates

Middle

Light

90%

Direct/ Bulk

Retail

80%

100%

23%

24%

25%

23%

24%

80%

70%

11%

60%

9%

8%

7%

7%

7%

56%

57%

3%
6%

8%
7%

50%

60%

52%

49%

44%

51%

48%

40%

40%
30%

58%

65%

60%

20%

20%

24%

28%

31%

26%

27%

0%

10%

22%

30%

29%

26%

25%

QE1209

QE0310

FY-09

FY-10

0%
QE0309

QE1209

QE0310

FY-09

FY-10

QE0309

19

Essar Energy Refining & Marketing

Increasing capacity and complexity
Capacit (MT)
Capacity
Current

(a)

Key highlights
1

Low cost,
cost safe and efficient operations refinery operating cost
US$1-2 per barrel lower than global peers

Strategically located on the west coast of India

Increasing complexity from 6.1 to 11.8 following Phase 1, enhancing

crude and product flexibility

Crude slate geared towards heavy crudes (89% of crude mix

comprises of heavy and ultra-heavy crude)

Vadinar currentlyy one of Indias largest

g refineries: will be amongst
g
(d)
the top 5 globally at 750k bbl/d post Phase 2

The timing for Phase 2 will be finalised based on a review of market

conditions and attainment of financial closure

Expansion at competitive capex cost; cost/complexity/bbl of $1011

and $962 post Phase I & Phase II respectively

March 2011 March 2013

36

18
14

Post

Today Phase 1 expansion

Phase 2 expansion

Total cumulative
capex(b)

US$2.5bn

US$4.0bn

US$8.4bn

US$1.5bn

US$4.4bn

6.1

11.8

12.8

API (density) avg.:

31.3

24.8

24.0

Sulphur % avg.:

1.6%

3.0%

3.0%

Product grade:

Euro III/IV

Euro IV/V

Euro V/
US Spec/
CARB

Total incremental
capex(b)
Complexity:
p
y

(a)
(b)
(c)
(d)

Post

The timing for Phase 2 will be finalised based on a review of market conditions and
attainment of financial closure
INR/US$: 50.95
Ultra-heavy crude defined as having API <25 and heavy crude as having API between 25 & 33
Calculated on the basis of number of operating days per annum

Source: Company information

20

500

Essar current

200

Surgutne
eftegaz Kirishi

540

HOV
VENSA St Croix

580

FPCC Mailiao

605

S-Oil Onsan

Exxon
nMobil Jurong

730

Essaar Phase Two*

GS-Caltex

400

SK Ulsan

600

A - Paraguana
PDVSA

Reliance - Jamnagar

bpd

To be Fifth largest refinery in the world post phase II

p
expansion
1,400

1,200

1,000

800

1,240

940
817
688
460
279

* As per KBC report

21

Expansion at highly competitive capex

New refineries capex country average

60,000

30 000
30,000

50,000

25,000

40,000

20,000

30,000

World average: US$23,400/bpd

Capex ($/bpd)

Capex ($/bpd)

New grass roots refineries capacity vs capex

15,000

10,000

20,000

Essar Energy post phase 2

Essar Energy post phase 1

10,000

5,000

Essar Energy current

0
0

100

200

300

400

500

600

700

800

World
average

Capacity (kbp/d)

China

Saudi
Arabia

India

Essar
Energy
current

Essar
Essar
Energy Energy
post
post
phase I phase II

Note: The timing for Phase 2 will be finished based on a review of market condition and attainment of financial closure
Source: KBC, Company information
22

Expansion
p
to provide
p
crude as well as product
p
flexibilityy
Ultraheavy
20%

Crude mix
C

Light
28%

Light
6%

Heavy
31%

Heavy
25%

Ultraheavyy
63%

Ultray
heavy
64%

Heavy
52%

14MT
(current)

18MT
(expected post phase 1 expansion)

Light
distillates
22%

Heavy end
25%

Product yield

Light
11%

Heavy end
15%

Fuell loss
F
l
6%
Middle
distillates
49%

Middle
distillates
47%

14MT
(current)

36MT
(expected post phase 2 expansion)

Light
distillates
22%

VGO
10%
Fuel loss
4%

18MT
(expected post phase 1 expansion)

Heavy end
15%

Middle
distillates
48%

Light
distillates
29%

Propylene
3%
Fuel loss
5%

36MT
(expected post phase 2 expansion)

Processing an increasingly high proportion of high sulphur and low API crudes
Focus on delivery of higher margin products (middle/light distillates)
Note:

Excludes Kenya Petroleum refinery

Ultra-heavy crude defined as having API<25, heavy crude with API 25 33, light crude with API>33
Dar and Mangala crude with high tan and wax content classified as heavy crude
Product yield fuel and loss does not include natural gas
Source: Company information

23

Yield to shift to higher grade productsoptimal for export

markets
Conversion of entire negative margin fuel oil into high value added products and pet coke
Building higher flexibility between light and middle distillates
Flexibility to produce petrochemical feed stock
Euro IV & V grade at 87% in Gasoline pool and 78.4% in Diesel pool

Gasoline: 9MT

LPG/ Naphtha

Gasoline

5.0

7.8

16.9

13.9

Euro III
13.0%

4.2

Euro V
49.9%

24.4

Euro IV
37.0%

Diesel: 13MT Euro III

21.5%

Diesel
40.9

42.9

37.8

Euro IV
47.2%

J t /Kero
Jet
/K
6.5

Euro V
31.2%

6.5
11.0

Fuel Oil

10.2

Pet Coke

20.3

2.8

Propylene

3.3
11.4

Others
Fuel & Loss Residue

4.3

11.4

1.5
1.5

6.1

4.0

5.4

14MT (a)

18MT (a)

36MT (a)

Note: Others include bitumen, sulphur and HDT VGO

(a) Expected and could change from time to time depending on market dynamics
Source: Company information
24

Phase 1 Overall Project

j
completion
p
is 53% (March
(
2010))
Basic
Engineering

Detailed
Engineering

y All Basic Engineering

Completed

y Model reviews
completed

y Short / Long Lead

items Datasheets
issued
f procurementt
for

y Drawings released for

all major
civil, Structure, Heater,
Piping & Tankages
works

y Schedule A package
for all Units received.

y Drawings for E & I

works are in Progress.

Construction

Procurement

y All long lead items ordered

y Balance items to be
ordered by April-10.
y 87 % Piping Bulk material
ordering Completed & 40
% of pipes materials
received at site.
y Total 193 out of 1212 Nos
of Mechanical Tagged
Equipment received at
site.

y
y
y

OSBL pipe rack is in advanced

g of completion
p
and piping
pp g
stage
erection progressing in various
fronts.
ISBL Pipe rack , Technological
structures & Heater works are
progressing in full swing.
230,000 CUM of RCC completed.
10500 MT Structural Steel
fabricated & 3100 MT erected
18100 MT of Tankages
Fabrication & 15600 MT Erection
Completed.

25

Financial Highlights

26

Financial Results
Particulars
Throughput - Million Tonnes
INCOME
Income from operation
Less : Excise duty & Taxes
p
Net Income from operation
Other Income
Total Income

Quarter
Mar-09
3 31
3.31

Quarter
Dec-09
3 51
3.51

Quarter
Mar-10
3 60
3.60

2008-09
Full Year
11 95
11.95

2009-10
Full Year
13 50
13.50

8,031
1,248
6,783
,
51
6,834

11,421
1,494
9,927
,
38
9,965

11,941
1,489
10,452
,
92
10,544

41,816
4,300
37,516
,
184
37,700

42,402
5,897
36,505
,
210
36,715

EXPENDITURE
Cost of Goods Sold
Operating Expenditure
Forex Loss/( Gain)
Total Expenditure

5,469
333
(94)
5,708

9,576
330
(169)
9,738

9,831
279
(246)
9,864

34,203
1,033
1,261
36,498

34,255
1,186
(661)
34,780

EBITDA

1,126

228

680

1,203

1,935

Interest & Finance Charges

p
Cash Profit
Operational
Depreciation
PBT
Tax
PAT
GRM (USD/bbl) With Sales Tax Incentive
$
GRM (USD/bbl) Without Sales Tax Incentive $
IEA Cracking Margin
$

322
804
175
629
(32)
661
10.33
8.69
0.92

285
((58))
184
(242)
(15)
(226)
2.21
0.13
(3.24)

319
360
181
179
179
5.12
2.82
(0.63)

$
$
$

$
$
$

1,091
111
655
(544)
(30)
(514)
$ 7.69
$ 4.89
$ 2.56

$
$
$

1,179
757
728
28
(1)
29
4.38
2.29
(1.90)
27

Comparative
p
GRM
12.00
10.69

10 33
10.33

10.00
8.90

8.00
6.74

6.00

5.12

5.51

IEA- Margin
4.00

4.00

EOL GRM

2.21
2.06

2.00
1 77
1.77

2.05
0.92

0.00
Q1'09

Q2'09

Q3'09

Q4'09

Q1'10

Q2'10

Q3'10

-1.82

Q4'10
-0.77

-2.00
-1.93
-3.24

-4.00

Refining
g Margins
g

28

Keyy Value Drivers

CBM Raniganj to start

E&P

trial sale of CBM Gas

Q CY2010
byy Q2

Refining

Distribution

Existing Refinery to optimize

its profitability;
Processing of Mangla Crude
from Q1 2010
Utilization of Natural Gas
from Q
Q1,, 2010

Expansion of Retail
Outlets to 1500

Significant potential
of CBM and Oil
& Gas blocks

Phase I Expansion
Ph
E
i to
t
increase the
throughput to 18
MMTPA & slated to
complete by
March 2011
March,

Deregulation of
Petroleum Products
(MS/HSD) by Govt.

Execution of PSC for Ratna

& R-series

Phase II expansion to
increase throughput to 36
MMTPA

International distribution
capability

29

Lets Begin !

30