IndianOil has to recover Rs 2,000 cr from air carriers

New Delhi: India’s largest oil marketing company Indian Oil Corporation (IOC) alone has to recover dues worth about Rs 2,000 crore from the civil aviation companies on account of unpaid bills for sale of aviation turbine fuel, the company’s chairman and managing director Sarthak Behuria said.
The three state-run oil marketing companies, IndianOil, Hindustan Petroleum Corp Ltd and Bharat Petroleum Corp Ltd, have to collectively recover Rs 2,926 crore from air carriers due to the delayed payments from these companies for the purchase of fuel.
“Out of the Rs 2,000 crore outstanding, receivables of about Rs 1,000 crore have crossed the credit limit period,” Behuria told DNA Money.
Air India (now Nacil - post merger with Indian Airlines) owes about Rs 600 crore, Jet Airways owes about Rs 250 crore and Kingfisher Airlines owes to the company about Rs 100 crore, he said.
Air carriers buy aviation turbine fuel from the oil marketing companies on various commercial arrangements, including credit for up to 60 days for Jet Airways, 7 days for Kingfisher Airlines, and cash and carry for NACIL.
When the carriers fail to make the payment after the credit limit period expires, the oil companies term it as default.
23/10/08 Shaleen Agarwal/Daily News & Analysis

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Categories: Indian Aviation- In General Oct 2008