Russia-backed Indian refiner Nayara Energy posts record profit

A model of 3D-printed oil barrels is seen in front of the falling stock market chart in this illustration taken December 1, 2021. REUTERS/Dado Ruvic/Illustration/File Photo

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  • Profit for the June quarter at 35.64 billion rupees against a loss of 1.4 billion rupees a year ago
  • Earnings up on bringing in cheap Russian oil and exporting fuel
  • Key members after sanctions, including CFO resignation
  • Gets new board members as Rosneft candidate, Kesani quits

NEW DELHI, Aug 13 (Reuters) – India’s Nayara Energy, part-owned by Russian oil major Rosneft MM>, posted a record quarterly profit in April-June as margins improved on a rise in bringing in Russian oil and fuel exports at discounted prices.

Nayara posted a net profit of around 35.64 billion rupees ($447.5 million) in the June quarter, compared to a net loss of 1.39 billion rupees a year earlier, it said. it said Friday in a late-night stock market filing.

Rosneft and Kesani Enterprises Co Ltd, a consortium led by Trafigura Group and Russian investment group UCP, each hold 49.13% of Nayara’s capital.

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The private refiner’s June quarter profit was also higher than the Rs 10.30 billion profit recorded for the full year to March 31, 2022.

Indian refiners, which rarely bought Russian oil due to high transportation costs, have been grabbing Russian oil since late February after some Western countries and companies shunned purchases from Moscow following its invasion of Ukraine.

Nayara and private refiner Reliance Industries (RELI.NS) emerged as India’s top buyers of Russian oil and both companies reported profits in the June quarter.

In contrast, state retailers posted a net loss from April to June as they sold refined fuels at below-market prices in local markets to help the government mitigate the effects of inflation. .

Nayara, which operates a 400,000 barrel-per-day Vadinar refinery in the Indian state of Gujarat, was not sanctioned as part of the international response to Russia’s ‘special operation’ in Ukraine, but the giant Russian energy company Rosneft was.

Since the imposition of Western sanctions against Russia, some top executives have left the Indian company.

On Friday, Nayara announced the resignation of Rosneft representative Krzysztof Zielicki from its board and the appointment of Andrey Bogatenkov.

Chief Financial Officer Anup Vikal has also resigned, Nayara said on Wednesday.

Last week, it announced the resignation of Jonathan Kollek, a candidate for Kesani Enterprises, from its board and named Sachin Gupta in his place.

Bogatenkov is vice president of trade and logistics at Rosneft and Gupta is managing director of Trafigura India.

Some foreign banks and India’s HDFC Bank have stopped offering trade credit for oil imports to Nayara and some suppliers are asking for payment in advance to avoid problems resulting from Western sanctions. Read more

Additionally, India’s CARE Ratings has placed Nayara’s long-term ratings under “under review with negative implications” due to sanctions against Moscow. Read more

($1 = 79.6410 Indian rupees)

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Reporting by Nidhi Verma; Editing by Josie Kao

Our standards: The Thomson Reuters Trust Principles.

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