Re depreciation costs IOC Rs 1,200 crore | business | Hindustan Times
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Re depreciation costs IOC Rs 1,200 crore

business Updated: Oct 03, 2008 22:36 IST
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State-run oil marketing and refining major Indian Oil Corporation is losing about Rs 300 crore on an annualised basis for every one dollar depreciation in the rupee, said Sarthak Behuria, chairman, IOC, at an industry function on Friday.

“The impact till now is Rs 1,200 crore,” Behuria said.

The company’s crude oil import bill is likely to touch $ 38-40 billion this fiscal against $34 billion last year, due to rising crude prices.

The fall in the rupee is also pushing up the borrowing cost for IOC, as 40 per cent of the company’s total borrowing is conducted in US dollars.

The rupee’s decline has also limited the company’s gains from the sharp fall in crude oil prices.

Speaking on the sidelines of the same function, Mukesh Rohatagi, chairman and managing director, Engineers India Ltd (EIL), said, his company had bagged a $200-million order to upgrade Oil and Natural Gas Corporation’s exploration well at Bombay High.

EIL has been a consultant and has been involved in engineering, procurement and commissioning for oil companies.

“Our order book now stands at Rs 5000 crore, which a 100 per cent jump over the last year,” Rohtagi said.

On whether the global economic slowdown was affecting EIL’s business, Rohtagi said, “Orders in the exploratory stage may be affected due to the global economic slowdown, but in orders where we have achieved financial closure, there will be no impact of the slow down.”