Notwithstanding Karnataka entering Unlock Phase 2, demand for petroleum products, particularly the most sought-after ones such as high-speed diesel (HSD), motor spirit (MS-petrol), and Aviation Turbine Fuel (ATF), is yet to pick up.
Consequently, Mangalore Refinery and Petrochemicals Ltd. (MRPL), the State’s only petroleum refinery, which continued refining operations even during the lockdown period to cater to essential activities, is yet to achieve normal production as the demand for fuel is gradually picking up.
While some commercial activities, including shops and establishments, public transport buses etc., were allowed to commence from Unlock 1 itself, some other activities demanding high energy, including malls, cinemas, the tourism industry, railways, and civil aviation, were yet to commence fully, thereby reducing the demand for fuel, according to M. Venkatesh, MD of MRPL.
Mr. Venkatesh told The Hindu the company has almost curtailed the production of ATF as domestic flights had just commenced staggered operations while international flights were yet to start. MRPL used to sell about one lakh tonnes of ATF every month.
At the same time, the demand for petrol and diesel is slowly increasing, with it hitting about 60% and 70% of the peak demand, respectively, Mr. Venkatesh said.
MRPL spokesman Rudolph J. Noronha said that as against the peak crude processing capacity of 13 lakh tonnes a month, the average production had been 13 lakh, 6.71 lakh, and 6.27 lakh tonnes during April, May and June, respectively. The company expects production to increase in a fortnight. Diesel production has been steadily increasing, at 2.47 lakh, 2.65 lakh, and 3.38 lakh tonnes during the last three months, as against the average peak demand of 5.4 lakh tonnes. Petrol, too, has reached about 60% of the peak demand of 1.1 lakh tonnes a month.
MRPL’s losses
MRPL had suffered a substantial net loss of ₹2,078 crore during 2019-20 on account of various reasons, including acute water shortage in April-May, heavy rains in August 2019, and the COVID-19 lockdown in March 2020.
With continued production at lower demands under partial lockdown, the company would have to operate under lower revenues and margins, MRPL had stated in its annual results.
