GAIL reports in 53 per cent drop in Q4 profit

NEW DELHI: GAIL India, the country’s largest natural gas pipeline operator, has reported a 47% fall in quarterly profit on lower offtake of natural gas by customers and compressed margins in the petrochemicals business.

For the January-March quarter, the company on Wednesday reported a profit of Rs 511 crore. Net sales for the period stood at Rs 14,235 crore compared withRs 14,464 crore a year ago. The sharp decline in profit was “mainly due to decrease in volume of natural gas marketing, decrease in volume of natural gas transmission, lower price realisation of polymers and liquid hydrocarbon products, and increase in cost of production of polymers due to usage of more R-LNG (regasified liquefied natural gas),” the company said.

GAIL is caught in a longterm contract to take expensive gas (currently at about $13-13.5 per unit) from Qatar but can’t find customers easily to offload this, as LNG spot prices have fallen to less than $8 a unit. GAIL has an agreement to take 60% of the RLNG imported from Qatar by Petronet LNG.