Mangalore Refinery and Petrochemicals Directors Report, MRPL Reports by Directors
Mangalore Refinery and Petrochemicals
BSE: 500109|NSE: MRPL|ISIN: INE103A01014|SECTOR: Refineries
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Directors Report Year End : Mar '14    « Mar 13
Dear Members,
 On behalf of the Board of Directors of MRPL and on my behalf, it is my
 privilege to present the 26th Annual Report and the Audited Accounts
 for the financial year ended March 31, 2014.
 It is a matter of pride that your Company is now Schedule ''A'' Central
 Public Sector Enterprise (CPSE) upgraded from Schedule ''B'' status. Your
 Company is marching ahead with a renewed vision and commitments for
 greater growth. We focused at fortitude in advertises, embracing
 opportunities and over coming setbacks to gain in strength with
 continued support of all shareholders.
 - Highest ever crude processed at 14.59 MMT during the year 2013-14
 against 14.41 MMT during the previous year 2012-13.
 - Highest ever Turnover at Rs. 75,226 Crore during year 2013-14 against Rs.
 68,834 Crore for the previous year 2012-13.
 - Highest ever Export Turnover at Rs. 35,392 Crore during the year
 2013-14 against Rs. 33,340 Crore for the previous year 2012-13.
 - profit After Tax (PAT) at Rs. 601 Crore during the year 2013-14 against
 the loss of Rs. 757 Crore incurred for the previous year 2012-13
 The summarized financial performance of your company for the year ended
 31st March, 2014 is furnished below:
                                                (Rs. In Crore)
                                           Year ended    Year ended
                                           31st March,   31st March,
                                            2014              2013
 Turnover                                     75226         68834
 Profit before Depreciation Interest and Tax   1437           456
 Interest and Finance Charges                   321           329
 Gross Profit after interest but before 
 Depreciation                                  1116           127 
 and Tax
 Depreciation and Amortizations                 706           604
 Profit/(Loss) Before Tax                       410          (477)
 Provision for Taxation 
 (deferred tax liability)                      (191)          280
 Profit/(Loss) after Tax                        601          (757)
 Balance of profit/(Loss) brought forward from  4238          4999 
 previous year
 Surplus available for appropriation           4839          4242
 Transfer to Capital Redemption Reseve          -               4
 Balance carried to Balance Sheet              4839          4238
 In view of the carry forward losses of previous financial year and funds
 requirement for meeting huge capital expansion plans of the Company,
 your Board of Directors has not recommended any dividend for the
 financial year 2013-14. However, we are quite confdent to deliver growth
 and enhance shareholder value once all the units of Phase-III Refnery
 Project are made fully operational which will contribute significant
 improvement in operating profit margins of the Company.
 Your Company had processed the highest ever crude of 14.59 MMT during
 the financial year 2013-14 compared to 14.41 MMT during the previous
 financial year 2012-13. The Fuel and Loss net of commissioning usage was
 7.15%, higher by 1% as the fuel consumption during stabilisation of
 The Refnery achieved the Highest Crude processed with Energy index
 (MBTU/BBL/NRGF) of 60.88 during the year 2013-14 against 61.01 during
 the year 2012-13.
 Your Company has achieved highest ever export turnover of Rs.35,392 Crore
 during the financial year 2013-14 by exporting products viz., Motor
 Spirit (MS), Naphtha, Mixed Xylene (MX), High Speed Diesel (HSD), Air
 Turbine Fuel (ATF) and Fuel Oil (FO).
 Your Company continues to supply petroleum products viz. Mogas, ATF,
 Gas Oil and Fuel Oil to State Trading Corporation (STC), Mauritius.
 In the global competitive market, Your Company has secured its place by
 exporting petroleum products to 21 countries viz. Bahamas , China ,
 Egypt, Hongkong, Japan, Jordan, Kenya ,Korea, Malaysia ,Mauritius,
 Netherlands, Oman ,Saudi Arabia ,Singapore, Slovenia, South Africa,
 Taiwan, Turkey ,UAE, UK and Yemen and continues to explore more
 opportunities for its growth.
 Your Company have achieved 912 accident free days as on 22/07/2014 with
 8.59 million man hours worked. The various units of Phase -III Refnery
 Upgradation and Expansion Project and storage tanks were commissioned
 safely during the year.
 Your Company is committed towards imparting continuous training in fre
 and safety practices. During the year, 1085 employees and 5788 contract
 workmen were trained in fre and industrial safety. Regular Mock
 exercises were conducted considering the various emergency scenarios in
 plant and non plant areas.
 Your Company believes in Perform beyond Compliance - that is to
 perform better than minimum required by statutes. The Refnery of your
 Company is a certified ISO 14001: 2004 for Environment Management
 Systems. The major achievements on the Environment Management and
 performance are summarized as under:
 - The Phase -III has an advanced Waste Water Treatment Plant (WWTP)
 which includes oil effuent Treatment unit, Sequential Batch Reactor
 (SBR) unit and Membrane Bio Reactor (MBR). This unit was commissioned
 during the year.
 - Sulphur Pastillation Unit was commissioned in the Refnery to reduce
 dust emissions in the Sulphur Recovery Unit (SRU).
 - An advanced Reverse Osmosis (RO) Plant was commissioned on 30/10/2013
 for maximizing the quantity of treated water recycle back to the
 - Wet Air Oxidation (WAO) Unit is set-up in the Refnery to treat Spent
 Caustic to improve the WWTP performance.
 - Volatile Organic Compound (VOC) Recovery system in WWTP- III was
 commissioned during the year. VOC Emission is being monitored at 74,000
 points in the Refnery through reputed agency and corrective measures
 are taken to effectively minimize the same.
 - A Condensate Recovery Unit was commissioned in process unit resulting
 reduction in fresh water consumption.
 - A Closed Bioremediation Unit was commissioned in the Refnery as a
 part of WWTP.
 - Environment Awareness programs are organized periodically in the
 neighbouring villages & schools in association with Karnataka State
 Pollution Control Board (KSPCB).
 - Karnataka Forest Department, Government of Karnataka has been
 requested to develop greenbelt in 120 acres area of the Refnery. They
 have developed saplings and Plantation has been commenced in the
 Refnery area of your Company.
 - Advanced technology has been deployed for cleaning Crude oil Tanks in
 the Refnery.
 - Regular Seawater quality monitoring is being carried out by M/s.
 College of Fisheries on fortnight basis indicating no adverse effect on
 the marine environment.
 - Ten Ground Water monitoring stations in and around Refnery have been
 setup and regular monitoring of ground water quality is being carried
 out along with KSPCB. Average treated effuent recycled to cooling
 towers during the year was 70-75%.
 - Ambient air quality monitoring is being done inside and outside the
 Refnery at 9 locations (including 2 locations at Phase-III Project
 site) as per revised National Ambient Air Quality Monitoring Standard.
 Your Company has also undertaken the following projects which are in
 various stages of installation:
 Your Company has also undertaken the following projects which are in
 various stages of commissioning.
 - Vapour Recovering System for light hydrocarbon storage tanks in Phase
 – III Refnery Project,
 - Automatic Rim seal protection Installation in storage tanks.
 - Connection of LPG spheres and Mounded Bullets PSV discharge to fare
 1.7.1 Marketing and Business Development
 Your Company continued its direct marketing activities in the State of
 Karnataka and in the adjoining states. The total direct marketing
 turnover during the financial year 2013-14 was Rs. 2589 Crore.
 With the availability of natural gas pipeline in North Karnataka and
 Goa, some major customers have shifted from liquid fuels to gas,
 leading to shrinkage of liquid fuels market. However, your Company
 could establish a good market reach for sale of Petcoke produced from
 the Delayed Coker Unit (DCU) commissioned in Phase-III project during
 April, 2014.
 Your Company continues to develop its direct marketing network for
 various value added products like Petcoke, Polypropylene (PP) etc by
 various units commissioned in Phase-III Refnery project.
 1.7.2 Retail Operations
 Your Company embarked into bulk sales of HSD after the introduction of
 dual pricing for HSD which has improved sales considerably in the bulk
 consumer segment. Domestic sale of Mixed Xylene has increased
 considerably against previous year. Keeping in view the gradual
 decontrol of HSD in retail segment; Your company is evaluating the
 opportunity to set up few retail outlets in select markets.
 1.7.3 New Products Marketing Plan
 Your Company is setting up a Polypropylene (PP) plant of 440 KTPA
 capacity for bulk supplies to downstream processing industry. The
 channel partners have been identified for sale of Polypropylene (PP) in
 key areas in the domestic market. In addition to this your Company is
 also developing storage infrastructure for Polypropylene (PP) in
 Karnataka for managing its supply chain for marketing networks.
 1.7.4 Joint Ventures
 Your Company''s Joint Venture (JV) with Shell B.V. Netherland known as
 Shell MRPL Aviation Fuel Services Limited (SMAFSL) supplies Aviation
 Turbine Fuel (ATF) to both domestic and international airlines at
 Indian airports has performed well.
 The Turnover of the SMAFSL was Rs. 651 Crore during the financial year
 2013-14 against Rs. 486 Crore during the previous financial year 2012-13
 and the Pre-tax profit of Rs. 18.40 Crore during the financial year 2013-14
 against Rs.13.14 Crore during the previous financial year 2012-13. The
 company has declared dividend of 10% for the financial year 2013-14 as
 compared to 8% in the previous financial year 2012-13.
 - Upgraded to Schedule ''A'' CPSEs from Schedule B with effect from
 04/07/2013 by the Department of Public Enterprises, thereby making it
 eligible for achieving the NAVARATNA status.
 - Won the coveted Petrofed Award Refnery of the Year-2012 for its
 commendable performance in production and operational efficiencies while
 adhering to the norms of health, safety and environment protection.
 - Won the Refnery of the Year from Petrofed for the year 2011-12 for
 leading performance in production and operational efficiencies while
 meeting the norms of Health, Safety and Environment protection.
 - Won the Export Excellence Award, 2013 in Best Manufacturer /
 Exporter (large category) – Gold from the Federation of Karnataka
 Chamber of Commerce and Industry (FKCCI) on 22/06/2013.
 - Secured the frst prize for outstanding performance in the area of
 Hindi Implementation for the year 2012-13 by Town Offcial Language
 Committee(TOLIC), Mangalore on 28/05/2013.
 - Secured the frst prize in the Jawaharlal Nehru Centenary Awards for
 energy performance for the year 2011-12 & 2012-13 under the Refneries
 category having complexity of 6.0.
 - Secured the frst prize in the OGCF-2012 awards for Furnace/Boiler
 effciency having heat duty more than 1000MM Kcal/hr.
 - Won the State Export Excellence Award for 2012-13 & 2011-12 Medium/
 Large category – Gold & Platinum respectively by Government of
 - Won the award for Best Fuel efficient Boiler operation by the
 Department of Factories and Boilers on the occasion of 43rd National
 Safety Day celebration.
 3.1 ICRA has reaffirmed Issuer Rating Ir AAA (pronounced IR Triple A)
 to your company. This rating indicates the highest credit quality
 rating assigned by ICRA and the rated entity carries the lowest credit
 3.2 ICRA has reaffirmed [ICRA] AAA (pronounced as ICRA Triple A) to Rs.
 3,000 Crore Fund- Based limits of your company. The outlook on the
 rating is Stable.
 1.3 ICRA has reaffirmed [ICRA] A1  (pronounced as ICRA A one plus) to
 Rs. 4,000 Crore Non- Fund based limits of Your company.
 1.4 ICRA has reaffirmed [ICRA] A1  (pronounced as ICRA A one plus) to
 Rs. 1,500 Crore Commercial Paper issued by your company. This rating
 indicates the very strong degree of safety regarding timely payment of
 financial obligations i.e., which carries the lowest credit risk.
 1.5 CRISIL has reaffirmed [CCR AAA] (pronounced as CCR Triple A). This
 rating indicates highest degree of strength with regard to honouring
 debt obligations by Your company.
 The financial Statements have been prepared in accordance with the
 Generally Accepted Accounting Principles (GAAP), all accounting
 standards guidance note on accounting for activities of your company
 issued by The Institute of Chartered Accountants of India (ICAI) and
 Schedule VI format and other relevant provisions of the Companies Act,
 1956. The MCA General Circular No.  1/19/2013-CL-V dated 04/04/2014
 clarifes that the Annual Accounts/Financial Statements along with
 documents required to be attached thereto, Auditors'' Report and Boards''
 Report in respect of financial years that commenced earlier than 1st
 April, 2014 shall be governed by the relevant provisions/
 Schedules/rules of the Companies Act, 1956.
 Your Company has a well-established internal control system, which is
 commensurate with its size and nature of operations. The internal
 control systems are designed to provide a reasonable assurance over
 reliability in financial reporting, ensure appropriate authorisation of
 transactions, safe guarding the assets of the Company and prevent
 misuse/losses and legal compliances.
 The internal control system includes a well-Defined delegation of
 authority and a comprehensive Management Information System coupled
 with monthly reviews of operational and financial performance, a
 well-structured budgeting process with regular monitoring of expenses,
 a state of art ERP systems and Internal audit.
 The internal audit team is led by a professional audit manager and
 supported by financial and technical personnel drawn from across the
 organisation. The internal audit is conducted as per a plan drawn at
 the beginning of the year in consultation with the management and
 statutory auditors of the Company which is finally approved by the Audit
 Committee. The audit plan attempts to cover all significant risk areas,
 review and evaluation of the effectiveness of existing processes,
 controls and compliances and ensure adherence to policies and
 procedures. All the significant audit observations made by the internal
 auditors of the Company are regularly reviewed by the management.
 However, all significant audit observations along with the management
 responses/ replies and follow up actions are periodically placed for
 review before the Audit Committee.
 A) Ongoing projects:
 i.  Phase -III Refnery Upgradation and Expansion Project.
 The commissioning of Secondary Process Units of Phase -III Refnery
 Upgradation and Expansion project are under near completion, which will
 increase the distillate yield and produce high value products viz
 Propylene, Gasoline from low value black oils.
 Crude Distillation Unit (CDU), Hydrogen Generation Unit (HGU) and
 Diesel Hydrotreater Unit (DHDT) were commissioned in the last financial
 year. The Refnery achieved major milestones with the commissioning of
 the Delayed Coker Unit (DCU), one train of Sulphur Recovery Unit (SRU)
 and Coker Gasoil Hydro Treating Unit (CHTU) in the months of April and
 May 2014. The last process unit in Phase -III, Petro (PFCCU) unit is
 under advance stage of commissioning and expected to go on stream
 The delay in commissioning was mainly on account of the delay in the
 completion of the Captive Power Plant (CPP) being executed by M/S BHEL.
 Most of the major equipments are commissioned and it is expected that
 the CPP can supply the required quantity of steam and power for running
 all the Phase -III units.
 The total expenditure incurred by your Company on Phase –III Refnery
 Upgradation and Expansion project is around Rs. 11500 Crore as on
 ii.  Polypropylene Project (PP):
 The Polypropylene (PP) unit being set up with the licensor M/s Novolen
 Technology, Germany in integration with the Phase -III Project at an
 estimated Capex of Rs. 1804 Crore by your Company has achieved an overall
 progress of 95.6% as on 15/07/2014.
 The non-vacating of the site by PDF had resulted in shifting the
 location of the unit causing delay in the site work and environmental
 clearance. The project is expected to get mechanically completed and
 will go on stream shortly. The total expenditure incurred on this
 project was Rs. 960 Crore as on 15/07/2014.
 iii.  Single Point Mooring (SPM) Project:
 Your Company has setup SPM project along with coastal booster pumping
 station within the port limits at a location of 16 Km from the shore
 having the draft availability of 30 M for handling Very Large Crude
 Carrier (VLCC) at an estimated cost of Rs. 1044 Crore . The SPM was
 successfully commissioned on 29/08/2013 by unloading the frst crude
 vessel Ratna Puja with the cargo of 87 TMT(''000MT).
 This facility will enable the company to receive crude in Suez max /
 VLCC vessels, which in turn will give freight economics and also allow
 access to West African and Latin American countries for sourcing
 crudes. This facility will also de-congest existing berth facility at
 New Mangalore Port Trust (NMPT) port and reduce the incidence of
 iv.  Refnery Performance Improvement Programme
 Your Company has taken up Refnery Performance Improvement Programme
 (RPIP) through M/s Shell Global Solutions International B.V. under the
 auspices of Centre for High Technology, Ministry of Petroleum and
 Natural Gas (MoP&NG), Government of India.
 The RPIP is aimed at identifying opportunities for improvement by
 adopting best operating practices in the areas having a bearing on
 profit margin including optimizing operation , energy and utilities
 consumption , minimizing hydrocarbon loss and improving maintenance and
 inspection practices.
 The PFI''s (Proposals for Implementation) developed after the
 evaluations are under various stages of implementation.
 B) Future Projects:
 Your Company has signed an Memorandum of Understanding (MOU) with
 Government of Karnataka for setting up a Linear Alkyl Benzene (LAB)
 Plant (for producing raw materials to manufacture detergent) and to
 expand its Refning capacity to 18/21 MMTPA in a time horizon of 3 to 6
 years subject to techno economic viability and availability of required
 infrastructure at Mangalore with an approximate investment of Rs. 8500
 The additional information required to be disclosed pursuant to section
 217(1) (e) of the Companies Act, 1956 read with the Companies
 (Disclosure of Particulars in the Report of Directors) Rules, 1988 with
 respect to conservation of energy, technology absorption and foreign
 exchange earnings & outgo are furnished in ''Annexure- I'' which forms
 part of this Report.
 Your Company being a Government Company is exempted from disclosure of
 particulars of employees under section 217(2A) of the Companies Act,
 1956, and the Particulars of Employees (Amendment) Rules, 2011.
 Your Company''s RTI manual is available on its website,
 which discloses all required information.
 During the year, 114 applications were received, out of which 111 were
 disposed off before 31/03/2014 and balance 3 applications were disposed
 off subsequently.
 - Your Company continued to enjoy cordial and harmonious relations with
 the collectives and as evidence to the same not a single man-hour was
 lost on account of any industrial disturbance during the year 2013-14.
 - During the year, your Company has recruited 114 employees comprising
 of 8 women employees and 44 Schedules Caste (SC) / Schedule Tribe (ST)
 - Total employee strength as on 31/03/2014 was 1715 including 127 women
 employees,191 SC/ST employees and 7 Physically Challenged employees.
 704 employes belong to Management cadre whereas 1011 employees belong
 to Non-Management cadre.
 - During the year 2013-14, Your Company devoted 4809 Mandays for
 Training, Development and Learning which amounted to an average of 3
 Mandays per employee. This includes functional, developmental and
 special training programs covering the entire spectrum of employees.
 Your Company is implementing Offcial Language Policy in letter and
 spirit as per the Annual Programme prescribed by the Department of
 Offcial Language, Ministry of Home Affairs, Government of India. In
 order to propagate Hindi among the employees, Hindi Workshops are
 organised on a regular basis at Mangalore, Mumbai, Delhi & Bangalore
 offices. Regular Hindi classes such as Prabodh, Praveen & Pragya in
 addition to Hindi Stenography are being conducted for employees. In
 order to increase the correspondence in Hindi, by the employees,
 special efforts are made to activate Unicode facilities on all the
 computers used in your Company. To motivate employees for Hindi usage,
 various incentive schemes are introduced such as Cash award & Personal
 Your Company has developed a structured mechanism of vigilance
 functions and its practices are focused towards creation of value for
 all the stakeholders.  The practices involve multi-layer checks and
 balances to improve transparency.  Vigilance Awareness and Preventive
 vigilance activities were continuously carried out during the year.
 Guidelines of Central Vigilance Commission (CVC) are being followed.
 officers in sensitive posts are rotated regularly.
 Whistle Blower Policy for employees is in place which ensures that a
 genuine whistle blower is granted due protection from any
 victimization. In compliance with CVC instruction, your Company has
 implemented a complaint handling policy in which all complaints
 received from various sources can get recorded and can be examined by
 vigilance. Further, in line with CVC instruction, your Company has
 achieved high compliance level with regard to e-payment and e-tender.
 Leveraging of technology to enhance transparency has been a thrust area
 of action in which vigilance has played a catalytic role. The website
 of the company displays downloadable tender document, publication of
 information of works awarded on nomination basis, publication of post
 award information of contracts.
 Full time Chief Vigilance officer (CVO) is posted and he can be
 contacted at for any complaint having vigilance
 Security of Refnery of your Company is designed to comply with Oil
 Sector Infrastructure Protection Plan (OSIPP) and the Security Audit
 recommendations given by the Intelligence Bureau (IB), Ministry of Home
 Affairs, Government of India from time to time are duly implemented.
 The Security of the Refnery of your Company is handled by Central
 Industrial Security Force (CISF) and survey to extend CISF coverage to
 newly commissioned Phase -III Project is underway. A project to install
 an integrated Security Surveillance System for the entire Refnery is on
 the anvil.
 Security is on top of the agenda of your Company and to ensure
 preparedness, periodic mock drills on work-place security preparedness
 are conducted. To promote awareness on security issues amongst all
 stake holders, Security Awareness Weeks are organized.
 Your Company''s social welfare and community development initiatives
 focus on the key areas of education, health care and overall
 development of basic infrastructure in and around its operational
 areas. The CSR objective of your Company in line with DPE guidelines is
 promoted under the name of SAMRAKSHAN. This captures the spirit and
 commitment to protect, preserve and promote the social, cultural and
 environmental heritage and wealth in and around the area of our
 business and to usher in sustainable development. Facilitating Midday
 Meal to support continuing Education, setting up of computer room,
 Anganwadi building, skill development training for youths,
 infrastructural development etc. is a part of the Samrakshan
 Your company has spent Rs. 3.47 Crore for various CSR activities during
 the year 2013-14.
 During the year following changes took place in Board of Directors of
 Your Company:
 15.1 Shri D.K. Sarraf has assumed the position of CMD, ONGC and
 Chairman/ Director of your Company w.e.f. 01/03/2014 consequent to
 superannuation of Shri Sudhir Vasudeva from the services of ONGC.
 15.2 Consequent upon attaining the age of superannuation Shri P P
 Upadhya, Managing Director, retired from the services of MRPL on July
 31, 2014. Shri Vishnu Agrawal, Director (Finance) has assumed the
 additional charge of the post of Managing Director w.e.f. 01/08/2014.
 15.3 Shri V G Joshi was appointed Director (Refnery) w.e.f. 04/04/2013.
 15.4 Shri P Kalyanasundaram, Joint Secretary, MoP&NG was appointed
 Government Director w.e.f. 15/04/2013 in place of Shri P. K. Singh.
 Shri P.  Kalyanasundaram who retires by rotation and being eligible
 offers himself for re-appointment as a Director.
 15.5 Shri B. K. Namdeo, Director Refnery (HPCL) was appointed as
 Director w.e.f.  01/07/2013 in place of Shri K. Murali consequent upon
 superannuation from the services of HPCL. Shri B. K. Namdeo who retires
 by rotation and being eligible offers himself for re-appointment as a
 15.6 Shri B Ravindranath ceased to be an Independent Director / Nominee
 Director of IDBI Bank Limited., w.e.f. 06/01/2014.
 15.7 Dr. D. Chandrasekharam ceased to be an Independent Director w.e.f.
 10/03/2014 consequent upon the expiry of his 3 years term as an
 Independent Director on the Board of ONGC.
 15.8 Shri K. S. Jamestin, Special Invitee on the Board, was
 superannuated from the services of ONGC as Director (HR) on 31/07/2014
 and ceased to be a Special Invitee on the Board. Shri A. K. Banerjee,
 Director (Finance), ONGC, has been nominated as Special Invitee on the
 Board of MRPL w.e.f. 05/08/2014.
 15.9 The Board wishes to place on record its deep appreciation for the
 services rendered and contribution made by Shri Sudhir Vasudeva, Shri P
 P Upadhya, Shri P. K. Singh, Shri K. Murali, Shri B Ravindranath, Dr.
 D.  Chandrasekharam and Shri K. S. Jamestin as directors / special
 Invitee during their tenure on the Board of the company.
 Pursuant to the requirement under section 217(2AA) of the Companies
 Act, 1956, with respect to Directors'' responsibility statement, it is
 hereby confirmed that:
 a.  In the preparation of the Annual Accounts, the applicable
 Accounting Standards have been followed along with proper explanation
 relating to material departures;
 b.  The Directors have selected such accounting policies and applied
 them consistently and made judgments and estimates that are reasonable
 and prudent so as to give a true and fair view of the state of affairs
 of the company at the end of the financial year 2013-14 and of the profit
 and loss of the company for that period;
 c.  The Directors have taken proper and suffcient care for the
 maintenance of adequate accounting records in accordance with the
 provisions of the Companies Act, 1956 and 2013 for safeguarding the
 assets of the company and for preventing and detecting fraud and other
 d.  The Directors have prepared the Annual Accounts for the financial
 year 2013- 14 on going concern basis.
 Your company has not accepted any fixed deposit during the year from the
 18.1 Your company has complied with all the mandatory provisions of
 Clause 49 of the Listing Agreement relating to the Corporate Governance
 requirements and mandatory guidelines on Corporate Governance for CPSEs
 issued by DPE, Government of India, except the composition of Board of
 18.2 The Annual Report contains a separate section on Corporate
 Governance, which forms part of this Report.
 18.3 Pursuant to Clause 55 of Listing Agreement, Annual Business
 Responsibility Report (ABRR) has been prepared for the financial year
 and the same has been uploaded on the website of the company
 18.4 Pursuant to Clause 49 of the Listing Agreement with Stock
 Exchanges, Your company has obtained the Certifcate from the Joint
 Statutory Auditors of the Company, towards Compliance of Corporate
 Governance which is annexed to and forms part of this report.
 18.5 As a measure of good corporate governance, Your company has
 engaged M/s Ullas Kumar Melinamogaru & Associates, Practicing Company
 Secretaries, Mangalore for conducting Annual Secretarial Compliance
 Audit for the year 2013-2014. M/s Ullas Kumar Melinamogaru & Associates
 Practicing Company Secretaries, Mangalore have issued Annual
 Secretarial Compliance Audit Report for the year 2013-14 which forms
 part of this report.
 In terms of Clause 49 (IV)(F) of the Listing Agreement with the Stock
 Exchanges, the Management Discussion and Analysis Report for the year
 have been attached and forms part of this report.
 20.1 M/s Gopalaiyer and Subramanian, Coimbatore and M/s A Raghavendra
 Rao and Associates, Mangalore have been appointed as Joint Statutory
 Auditors of the Company for the Financial Year 2013-14 by Comptroller &
 Auditor General of India (C&AG).
 20.2 The report of the C&AG at Annexure III forms part of this Report.
 20.3 Pursuant to the provisions of the Companies Act, 1956, the cost
 accounts maintained by the company for the financial year 2013 -14 are
 being audited by Cost Auditors M/s. Musib and Associates with approval
 of Ministry of Corporate Affairs, Government of India.
 - Your Company always conducts business with a strong commitment for
 environment preservation, sustainable development, safe workplaces and
 enrichment of the quality of life of its stakeholders and the community
 at large.
 - Your Directors are highly grateful for all the help, guidance and
 support received from the Ministry of Petroleum and Natural Gas
 (MoP&NG), Ministry of Finance (MoF), Ministry of Corporate Affairs
 (MCA), Department of Public Enterprises (DPE), Ministry of Environment
 and Forest (MoEF), Ministry of External Affairs (MEA), Ministry of
 Shipping (MoS), Ministry of Home Affairs (MHA) Ministry of Heavy
 Industries and Public Enterprises (MoHI&PE) and other inistries and
 Departments of Central and State Governments especially the Government
 of Karnataka.
 - Your Directors gratefully acknowledge the continued support and
 guidance extended by Oil and Natural Gas Corporation (ONGC) Limited,
 the parent company.
 - Your Directors thank all shareholders and members of the Company for
 their faith, trust and confdence reposed on the Management of the
 - Your Directors wish to place on record their sincere appreciation for
 the sustained efforts and dedicated contributions put in by all the
 employees collectively and concertedly as a Team, to ensure that the
 Company continues to grow and excel.
                               For and on behalf of the Board
                                                (D.K. Sarraf) 
 Place: New Delhi
 Date : 05/08/2014
Source : Dion Global Solutions Limited
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