Bharat Petroleum Corporation Ltd (BPCL), the nation's second-biggest refiner, is not facing any liquidity problem and will not default on any of its financial obligations, Petroleum Secretary R S Pandey said today.
"BPCL and in fact all the public sector oil companies are not facing any liquidity problem," he told reporters here.
Mumbai-based BPCL, he said, had informed him that the reports of default on its obligations in respect of its External Commercial Borrowings (ECB) were incorrect.
"BPCL has informed that out of the current level of ECB of $300 million, around $100 million is due for repayment in October 2009 and the balance in March 2012," he said.
The company had not at any point of time defaulted on any of its borrowing obligations and other financial commitments.
"BPCL has adequate borrowing limits/credit lines for meeting all its fund requirements," he said.
Also the fall in international crude oil prices and the recent announcement of Reserve Bank of India of its plans to recommence the Special Market Operations (SMO) for buying oil bonds from public sector oil retailing firms, would provide ample liquidity to meet any financial obligation, BPCL informed the Petroleum Ministry.
"I categorically state that there is no liquidity problem with oil companies. It is not true that oil companies are facing problems getting loans from banks. The only issue is the cost of borrowing (which has gone up)," Pandey said.
Fuel retailers Indian Oil, Hindustan Petroleum and BPCL were losing Rs 280 crore per day on sale of petrol, diesel, domestic LPG and kerosene as they had been not allowed by the government to raise retail price in line with production cost.
