Dear Members,
 
 On behalf of the Board of Directors, I take pleasure in presenting the
 23rd Annual Report on the performance of your company, together with
 the audit report and audited account for the year ended 31st March,
 2011.
 
 It is a matter of immense satisfaction that the performance on Fiscal
 and Physical parameter of your company created certain new benchmarks
 of excellence during the year 2010-11. Some of the performance
 highlights are enumerated below:
 
 1) Highest ever Refinery crude thruput at 12.64 MMT.
 
 2) Highest ever Turnover at Rs. 43,800 Crores.
 
 3) Highest ever continuous accident free days of 1367 days as on 31st
 March, 2011.
 
 4) Highest ever products dispatched through Mangalore - Hassan -
 Bangalore pipeline of 2.576 MMT.
 
 5) Hydro cracker the major secondary processing unit achieved
 processing of 2.88 MMT (Capacity 121%).
 
 6) Energy index of 58.13 MBN the lowest ever achieved.
 
 7) Your Company signed a MoU with STC Mauritius 3 year products sale
 agreement signed in July, 2010.
 
 8) Overall Refinery performance for 2009-10 was found to be qualifed for
 excellent rating of MoU with Government of India.
 
 9) Phase – III Refinery upgradation and expansion project has achieved a
 overall progress of 84.4% (Actual) as against schedule target of 92.7%
 as on 15th June, 2011.
 
 1.1 FINANCIAL PERFORMANCE
 
                                                       (Rs. in Crore)
 
                                           Year ended       Year ended
 
                                     31st March, 2011 31st March, 2010
 
 Turnover                                      43,800           36,141
 
 Profit before Depreciation                      2,233            2,196
 
 Interest and Tax
 
 Interest and Finance Charges                     104              115
 
 Gross Profit after interest but before          2,129            2,081 
 
 Depreciation and Tax
 
 Depreciation and Amortizations                   391              389
 
 Profit Before Tax                               1,738            1,692
 
 Provision for Taxation                           561              580
 
 Profit after Tax                                1,177            1,112
 
 Balance of Profit/(Loss) brought forward        3,396            2,557 
 from previous year
 
 Surplus available for appropriation            4,573            3,669
 
 Appropriations:
 
 Proposed dividend on Preference                 0.00             0.00 
 Shares (Rs. 9,186)
 
 Proposed Dividend on Equity Shares               210              210
 
 Tax on Dividend                                   34               35
 
 Transfer to General Reserve                       30               28
 
 Balance carried to Balance Sheet               4,299            3,396
 
 1.2 DIVIDEND
 
 In view of the ensuing project investment and considering the
 performance, the Board of your company has decided to recommend a
 dividend payout of 12%. This will absorb Rs. 244 Crore including Rs. 34
 Crore as tax on dividend.
 
 1.3 OPERATIONAL PERFORMANCE
 
 The Refinery throughput was 12.64 MMT crude oil achieving 107% capacity
 utilization. The Refinery produced 11.77 MMT of finished products.
 
 1.4 EXPORTS
 
 Even in these challenging times your company has exported, MS, Naphtha,
 Mixed Xylene, HSD, ATF and FO totaling to 4.9 MMT amounting to Rs. 14,604
 Crore.
 
 1.5 Domestic Marketing of Products
 
 Your Company continued to make inroads in the direct sales segment in
 Karnataka and its adjoining states with sales turnover during the year
 at Rs. 2,291 Crores.
 
 In view of deregulation of MS pricing, your company has reformulated
 its Retail Business plan to set up 122 retail outlets in next two years
 and has developed its policy on dealer selection for setting up retail
 outlets predominantly in southern India.
 
 1.6 SAFETY PERFORMANCE
 
 - The Refinery has achieved its best ever record of 1367 days without
 Reportable Lost Time Injury (RLTI) as on 31st March, 2011 i.e. 9.59
 Million Man Hours without RLTI. On the Contractor''s level a total of
 757 days was completed from 5th March, 2009 to 31st March, 2011 i.e.
 7.69 Million Man Hours without RLTI.
 
 - In the year 2010, your company was adjudged as Most consistent
 Safety Performer in Refinery by Oil Industry Safety Directorate.
 
 - Safety at MRPL is the commitment of the Top Management and
 incorporates the highest standards amongst its employees and contract
 workmen. Periodic audits (both internal and external), Mock Exercise
 (Onsite & Offsite), regular training updates and a positive attitude
 towards safe work practices have ensured a safe and healthy work
 environment. All process plant modifications are verified through Hazard
 and Operability Study (HAZOP) before implementation.
 
 - HAZOP study of all Refinery facilities including Offsite and Utilities
 were carried out.
 
 1.7 ENVIRONMENT MANAGEMENT
 
 - In Environment Management, your company''s Philosophy is to perform
 beyond Compliance - that is to perform better than minimum required by
 statutes. The Refinery is certified with ISO 14001: 2004 for Environment
 Management Systems. Your Company has undertaken following initiatives
 for greener environment:
 
 - A Sulphur Pelletisation Unit was commissioned in the Refinery to
 reduce the dust emissions.
 
 - Wet Air Oxidation Plant is being commissioned in the Refinery for
 treating Spent Caustic resulting in further improving the quality of
 the treated effluent. Plant is in advance stage of completion.
 
 - Second Continuous Ambient Air Quality Monitoring System is being
 installed in the Refinery to monitor the air quality. Installation of
 instrument is in advance stage.
 
 - 26th Activity Committee Meet on Environment Management was jointly
 organized first time in MRPL by Centre for High Technology (CHT) and
 MRPL in the month of December, 2010.
 
 - Microbiology study completed on treated effluent by M/s. College of
 Fisheries.
 
 - VOC Emission monitoring carried out in the Refinery through reputed
 agency and corrective measures are taken to effectively minimize the
 same, wherever needed.
 
 - Order placed to State Forest Department, Govt. of Karnataka for
 developing Greenbelt & Mango Orchard in and around the Refinery, 5,000
 mangoes trees and 33,320 others trees, covering this 120 Acre Area.
 
 - Periodic Manual Stack Monitoring is being carried out by MOEF/ KSPCB
 approved external agency.
 
 - Work Environment Monitoring was carried out by M/s. Regional Labour
 Institute, Chennai.
 
 - Hydro geological Study is being carried out by M/s. National
 Geophysical Research Institute, Hyderabad in all water sheds of the
 Refinery.
 
 - Work Order placed on MOEF/KSPCB approved external agency for
 monitoring Ambient Air Quality in and around the Refinery as per revised
 National Ambient Air Quality Monitoring Standards published by Ministry
 of Environment & Forests.
 
 - An advance technology employed for cleaning Crude Tanks in the
 Refinery. Tank cleaning was carried out by M/s. Plant Tech – Mid-
 continent (India) Pvt. Ltd.
 
 - Bioremediation of 1000 MT of Oily Sludge has been completed by M/s.
 TERI, New Delhi.
 
 - Environment Awareness Programs conducted in the neighbouring villages
 for School Children and for the community members.
 
 - 70-75% of the total treated effluent is recycled back to the cooling
 towers.
 
 - Continuous online monitoring Analyzers installed to monitor Treated
 effluents for parameters like PH, Sulphide, Dissolved Oxygen, Phenols,
 and VOC (Volatile Organic Compound) before discharged to sea.
 
 - Treated effluents are monitored on a daily basis at both Refinery end &
 at APMC (Agricultural Produce Market Committee) yard.
 
 - SOx and NOx emissions in ambient air are well below the standard
 stipulated by pollution control board, the monitoring of which in and
 around the Refinery is being done by M/s. National Institute of
 Technology Karnataka.
 
 - A Fortnightly Marine Environment Impact Assessment study is being
 carried out though the M/s. Central Marine Fisheries Research
 Institute, Mangalore from 7 monitoring stations set-up in the vicinity
 of Treated effluent Disposal point (at sea) & 3 Stations in the
 Seashore. The monitoring of Flora and Fauna, Studies on Phytoplankton,
 Zooplankton & Benthic Organisms in the Ocean is being conducted. Study
 on Bioaccumulation of Heavy metals in Marine Organisms are also
 conducted twice per year.
 
 - Your Company is meeting the stipulations of KSPCB with regard to the
 quality and quantity of treated effluent, which is well below the
 standards in every aspect, on a continuous basis.
 
 - Ten Nos. of Ground Water monitoring stations in and around Refinery
 have been set up and regular monitoring of ground water quality is
 being carried out along with KSPCB.
 
 - Low sulphur Fuel oil with less than 1% sulphur is being used in all
 the Refinery furnaces and boilers, simultaneously maximizing the usage
 of ultra low Sulphur fuel gas generated in the Refinery process units.
 
 - 3 Sulphur Recovery Units (SRUs), 2 working   1 Standby established.
 SRUs are operated at efficiency greater than 99%.
 
 - Innovative methods of solid waste reduction have been carried out by
 using Bioremediation process.
 
 - Special health checkup is being carried out for employees working in
 high noise & dusty area and in units where Benzene is present.
 
 - On-line analyzers have been installed for continuous monitoring of
 stack emissions, apart from manual monitoring of all stacks for
 compliance to Environment norms.
 
 - Annual Submarine pipeline inspection carried out by M/s. National
 Institute of Oceanography (NIO).
 
 1.8 MARKETING
 
 1.8.1 Sales & Operation
 
 Your Company continued to make inroads in the direct sales segment in
 Karnataka and its adjoining states. Major inroads made in Mixed Xylene
 market. ATF sales increased by 23 % to 67 TMT as compared to last year
 sales of 54 TMT. Total sales turn over during the year was about Rs.
 2,291 Crores.
 
 VG 30 and VG 10 grade Bitumen supplies started during the year. Your
 Company also started HSD supplies ex-Hassan hospitality location. Your
 Company increased supplies to OMC locations in Tamilnadu & Kerala.
 
 1.8.2 Business Development
 
 Your Company entered into an agreement with State Trading Corporation,
 Mauritius on 1st July, 2010 for supply of 1.1 MMT per annum liquid
 petroleum products valued at about 800 million USD at current prices.
 The products comprising ATF, MS, HSD and Furnace Oil will be supplied
 for a period of 3 years and the total value of this deal at current
 prices is 2.4 billion USD.
 
 1.8.3 Joint ventures
 
 The Joint Venture of your company with Shell B.VNetherland viz., Shell
 MRPL Aviation Fuels and Services Private Limited for marketing of ATF
 achieved a operating Profit of Rs. 214.06 Million (Previous year Rs. 145.45
 Million), Pre tax Profit of Rs. 136.28 Million (Previous year Rs. 82.08
 Million) and Post tax Profit ofRs. 109.68 Million (Previous year Rs. 45.34
 Million) during the year. During the year, the sales under Delivering
 Company (DELCO) model were 85,489 KL (Previous year 68,927 KL). The
 Company fuelled 12,674 fights (Previous year 11,106 fights). Sales
 under the Contracting Company (CONCO) Model were 4,16,487KL (Previous
 year 3,43,133 KL).
 
 1.8.4 Retail
 
 Your Company continued to follow a non aggressive and cautious approach
 in marketing of HSD and petrol in view of the Government regulation in
 pricing. As of 1st April, 2011 MRPL is operating two HiQ retail outlets
 one each at Maddur and Hubli in Karnataka. The third outlet at Kadri
 Hills, Mangalore is under construction. In view of expected complete
 deregulation of MS and HSD pricing, your company has worked out its
 Retail Business plan to set up 122 retail outlets within two years.
 Your Company plans to set up these retail outlets predominantly around
 Mangalore with minimum logistic cost.
 
 2.  AWARDS AND RECOGNITION:
 
 The excellent standards maintained by the Refinery on the production,
 energy conservation, environment management and safety front, enabled
 us to bag several awards:
 
 - MRPL has bagged the Petrofed ''Refinery of the Year'' Award honoring
 performance in refining of petroleum in India during the year 2009-10.
 This recognizes leading Performance in production and operational
 efficiency in refining operations, while meeting the norms of health
 safety and environmental protection.
 
 - Oil Industry Safety directorate ranks MRPL as 1st in Most consistent
 safety performer in Refineries for the year 2009-10
 
 - Company has achieved the Excellent Target (Composite score 1.04)
 against the MOU Targets set with Government of India for the year
 2009-10
 
 - Best Exporter Award (Gold) – 2010 for exporting products through
 NMPT, by Federation of Karnataka Chamber of Commerce & Industries.
 
 - The Oil & Gas Conservation Award-2010 for Furnace/Boiler efficiency
 instituted by CHT
 
 - Your Company bagged 1st Prize in Furnace/Boiler efficiency under the
 Category-2 of Group-1 in the Annual OGCF-2009-10.
 
 - Your Company bagged the second Prize of Jawaharlal Nehru Centenary
 Awards 2009-10 for Energy Performance of Refinery with composite energy
 factor for more than 5, under Group-1.
 
 3.  IMPROVED CREDIT PROFILE
 
 3.1 Your Directors are pleased to inform you that ICRA Limited 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 i.e., MRPL carries the lowest
 credit risk.
 
 ICRA has reaffirmed LAAA (pronounced L triple A) the highest credit
 quality rating under ICRAs Long Term Rating Scale for Rs. 900 Crore Fund
 Based Working Capital limit of MRPL.
 
 ICRA has also reaffirmed the A1  (pronounced A one plus), the highest
 and relatively stronger credit quality rating (within the rating
 category of A1) under ICRAs Short Term Rating Scale for Rs. 5,500 Crore
 Non-fund Based working capital Limit of MRPL.
 
 4.  PROJECTS
 
 4.1 Phase III Refinery Project:
 
 As you are aware, your company is currently implementing Phase III
 Refinery Project with an objective of increasing Profitability by
 increasing the refining capacity to 15 MMTPA, to process more of low
 price high Sulphur/high acid, heavy crude oils, increasing the
 distillate yield by upgrading low value black oils, producing value
 added products like Propylene and upgradation of its total diesel pool
 to superior (Euro III/ IV) grade. The estimated cost of the project is
 Rs. 12,160.26 Crore. Orders have been placed for all the units like PFCC,
 SRU & PPU, Captive Power Plant (CPP), Hydrogen & DHDT Units, CHT, DCU
 etc., as well as all utility
 
 packages like Nitrogen, Compressed Air, Raw Water, Cooling water DM
 water and Waste Water Treatment Plant. The total value of orders placed
 as on 31st May, 2011 is Rs. 10,193 Crore. The implementation is
 progressing satisfactorily.
 
 The Project has achieved a overall progress of 84.4% (Actual) as
 against schedule target of 92.7% as on 15th June, 2011. The captive
 powerplant being executed by M/s BHEL has acheived overall progress of
 81.3% (Actual) against schedule of 96.6% as on 15th June, 2011, M/s
 BHEL has indicated 6 months delay in completion. To achieve production
 schedule of January, 2012, your Company has initiated action to draw
 power and steam from existing powerplants. The project is expected to
 achieve start of production within financial year 2011-12.
 
 4.2 Polypropylene Project:
 
 As you are aware that your company has been setting up Polypropylene
 unit integrated with the Phase III Project at an estimated capex of Rs.
 1803.78 Crore. M/s.Engineers India Limited (EIL) has been engaged to
 implement the project under Open Book Execution (OBE) methodology.
 M/s.Novelene Technology, Germany have been selected as licensor for the
 project. However, the site work has been delayed due to PDF problems in
 this area. This has resulted in shifting the location of the unit. Site
 grading work has been carried out in the new location and is now ready
 for start of civil works. Fresh clearance from MOEF as required due to
 shifting of PP unit from MSEZ to MRPL Phase III Area is expected
 Shortly.
 
 Polypropylene Project has achieved a progress of 64.2% (Actual) as
 against target of 67.2% (Scheduled) as of 15th June, 2011. Proactive
 actions have been taken to minimise delay from approved mechanical
 completion target of April, 2012 and commissioning by July, 2012.
 
 Cost Commitment made for Polypropylene Project is Rs. 1,290.56 Crore and
 the expenditure incurred is Rs. 301.6 Crore as of 15th June, 2011.
 
 4.3 SPM Project:
 
 As reported last year, your company is proposing to set up a Single
 Point Mooring (SPM) facility in the sea of Mangalore Port area with an
 objective to receive crude oil in Very Large Crude Carrier (VLCC)
 tankers.  Your Company Board approved the SPM Project in June, 2010 and
 subsequently ONGC Board Approved the SPM Project in July, 2010.
 
 M/s Engineers India Ltd (EIL) is appointed as OBE/LSTK Contractor for
 this Project. EIL have already completed ordering of major long lead
 equipments like Booster Pumps with Diesel Engine, SPM, Bare Pipe,
 Valves, Pipe Fittings etc and ordering for the balance items is in
 progress. The Civil and Structural Work Contract, Sub Sea Pipeline and
 SPM Installation Contract are placed. Civil and Structural Work for the
 Booster Pump Station is in progress in NMPT Limits. Tender Floated for
 Composite Works.
 
 The Progress of the Project as on 15.05.2011 is 15.7%.
 
 Your Company has already obtained Environmental Clearance from Ministry
 of Environment and Forests, Government of India for the Project.
 
 5.  INTERNAL PROJECTS
 
 5.1 CDU / VDU1 revamp:
 
 The CDU / VDU Phase 1 unit for improvements in yield with better energy
 efficiency. The Basic Engineering was done by M/s. EIL who is the
 suppliers of Basic Engineering & Detailed Engineering for the original
 unit. Project Management Consultant (PMC) for the project is M/s. Uhde
 
 India Pvt. Ltd. (UIPL). The LSTK Contractor is M/s. Toyo Engineering
 India Ltd. The Pre-shutdown activities related to the Project are
 completed and the Shutdown works shall be taken up in the scheduled
 Turnaround during September/October 2011.
 
 5.2 Revamp of naphtha splitter unit-2:
 
 This project is for maximizing the capacity utilization of the existing
 Isomerisation Unit and the CCR Unit with better Naphtha management.
 The Naphtha Splitter Unit-2 is being revamped with minor changes. The
 Basic Engineering has been carried out by Process Design Engg. Cell of
 M/s IOCL. M/s Engineers India Limited (EIL) has been retained for the
 Engineering & Procurement services. The estimated Project cost is about
 Rs.9.5 Crores and targeted completion by April, 2012.
 
 5.3 Relocation of tank truck loading for BS IV MS / HSD and
 argumentation of ATF loading facility:
 
 The existing BS IV MS/HSD tank truck loading is being carried out at
 hired third party a premise which has inherent limitations. Loading
 facilities is being proposed at own premises at a cost of approximately
 Rs. 25 Crores (inclusive of security related infrastructure). M/s. Mecon
 have been retained as the Project Management Consultant and engineering
 is nearing completion. The schedule completion is March, 2013.
 
 Highlights of activities
 
 - GOHDS (Gas Oil Hydro De-sulphurisation ) unit major revamp was
 successfully completed 4.5 months ahead of schedule and Unit
 commissioned on 16th April, 2010 which facilitates MRPLto Produce
 higher quantity of Euro-3 & Euro-4 grade low sulphur Diesel Products.
 
 - Sulphur Pellatisation unit was commissioned on 29th July, 2010 which
 facilitates MRPL to market Pellatised sulphur.
 
 - Hydrocracker-1 and Hydrogen-1 Catalyst replacement activity was
 safely & Successfully completed during June, 2010.
 
 - CDU-2 Annual turnaround was carried out during 22nd Aug to 13th Sep,
 2010.
 
 - Major activity like entire radiation heater coil replacement of VDU
 was successfully completed.
 
 - CDU-1, VDU-1, VBU-1&2 heater coil online cleaning was carried out
 during Feb, 2011. This helped us to improve capacity utilization.
 
 6.  CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE
 EARNINGS & OUTGO AND PARTICULARS OF EMPLOYEES
 
 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 is furnished in ''Annexure - I'' which forms
 part of this Report.
 
 7.  PARTICULARS OF EMPLOYEES
 
 Pursuant to the Notification No. 2/29/1998-CL.V dated 31st March, 2011
 issued by Ministry of Corporate Affairs, the Particulars of Employees
 Rules, 2011 has been amended. As per the amendment, a government
 company is not required to publish the Particulars of employees under
 section 217(2A) of the Companies Act, 1956, and the rules framed
 thereunder.  Your company being a government company is exempted from
 disclosers under section 217(2A) of the Companies Act, 1956, and the
 rules framed thereunder.
 
 8.  HUMAN RESOURCES
 
 - During the year 2010-11, your company continued to enjoy cordial and
 harmonious relations with the collectives and as an evidence to the
 same, not a single man-hour was lost on account of any industrial
 disturbance during the entire year.
 
 - The Long Term Settlement (LTS) pertaining to Wage revision and other
 related benefits effective 1st April, 2007 with the Employees union was
 finalized and signed on 31st January, 2011.
 
 - As regards the pay revision for Board level and below Board level
 executives which was due from 1st January, 2007 is implemented
 successfully as per the Guidelines of Department of Public Enterprises
 , Government of India, (DPE)
 
 - Your Company has recruited 6 employees during the year 2010-11. Out
 of these 01 belonged to Scheduled Caste (SC), 01 belonged to Other
 Backward Class (OBC) and 01 women employee were recruited.
 
 - The number of employees as on 31st March, 2011 was 1294, including 73
 women employees. The number of employees belonging to SC, ST & OBC
 categories were 74, 24 and 317 respectively.
 
 - During the year 2010-11, your company devoted 4141 man-days for
 Training, Development and Learning which amounts to an average of 3.2
 man-days per employee. This included functional, developmental and
 special training programs covering the entire spectrum of employees.
 
 9.  OFFICIAL LANGUAGE
 
 Your Company is implementing Official Language Policy in letter and
 spirit as per the Annual Programme prescribed by the Department of
 Official Language, Ministry of Home Affairs, and Govt. of India. In
 order to propagate Hindi among the employees, Hindi Workshops are
 organized on a regular basis at Mangalore, Mumbai, Delhi & Bangalore
 Offices. Regular Hindi classes such as Prabodh, Praveen & Pragya are
 being conducted for employees. To motivate employees who pass final
 Hindi examinations, Incentive schemes are introduced such as Cash award
 & Personal Pay.
 
 For promoting the use of Hindi, Hindi Fortnight was celebrated and many
 Hindi competitions such as Hindi Essay, Dictation, Translation, Songs,
 Extempore speech etc. were conducted for the employees, their children
 and family members in the month of September, 2010. Competitions are
 also held in Hindi for employees and their family members during
 National Safety Day, Environment Day, Security awareness week and
 Vigilance awareness week. OL inspections of internal departments and
 subordinate Offices were carried out. Special awards were given to the
 three toppers of DPS-MRPL School children who stood first three in the
 public exam of class X in Hindi language.
 
 Your Company participated at TOLIC level Hindi competitions and won
 nine prizes and stood First at TOLIC level competition. Quarterly, half
 yearly and yearly reports are sent to all the controlling Agencies/
 Departments / MOP&NG on time by highlighting the progress made in
 promotion of Hindi in the company. To popularize usage of Hindi, Hasya
 Hindi Kavi sammelan was organized on 25th March, 2011. Five National
 level Hindi humor poets participated in the Programme.
 
 10.  VIGILANCE FUNCTION
 
 Your Company has developed a structured mechanism of vigilance
 functions and its practices are 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 are being followed. Officers in sensitive
 posts are rotated regularly. A ''Whistle Blower''s 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 very high compliance level with regard to
 e-payment, e-tender.
 
 Leveraging of technology to enhance transparency has been a thrust area
 of action in which vigilance has played a catalytic role. Prominent
 examples are publication of all tenders above Rs. 5.00 lakhs in Company
 website along-with provision for downloadable tender document,
 publication of information of works awarded on nomination in Company
 website, publication of post award information of all contracts above Rs.
 1.00 Crore in Company website.
 
 11.  SECURITY MEASURES
 
 11.1 CISF Induction:
 
 Following approval of 200 CISF manpower by Ministry of Home Affairs
 (MHA), for protection of MRPL, a Quick Reaction Team (QRT) team
 consisting of 22 CISF personnel was inducted to guard the Refinery on
 28th August, 2010. The remaining CISF manpower will be inducted once
 the CISF Township is constructed having target completion of 3rd
 quarter of 2013.
 
 11.2 CCTV Surveillance:
 
 Complete area of the Refinery is covered by state-of-the art CCTV
 Network. Few Cameras are working on OFC cables and rests of them are
 working on wireless technology. CCTV network is designed to cover all
 the access control gates and other strategic locations. Work for
 expanding the CCTV coverage to 10 more critical locations is going on.
 
 11.3 Access Control:
 
 Access to Plant area will be better controlled with completion of the
 proposed New Plant Gate & Security Building for which work will begin
 shortly. This Security Building will be equipped with Multi-Zone Metal
 Detectors and X-ray baggage scanners. This Gate will also have
 turnstiles controlled through bio-metric card readers for strict access
 control to Plant area. Anti-Vehicle Intrusion systems viz Tire Rippers/
 Bollards are also being planned to be installed at Plant Gates. Similar
 Marketing cum Security Infrastructure is being built in the Lower
 Plateau of the Refinery.
 
 11.4 IB Recommendations:
 
 Intelligence Bureau (IB) visits once in every two years to inspect
 security arrangements, identify grey area and to recommend / suggest
 improvements. All the recommendations given by the IB in the year 2008
 have been complied. The latest IB inspection was carried out on 28-29th
 December, 2010 and a fresh set of 30 Recommendations have been
 received. Action has been initiated to comply with all the
 recommendations in a time bound manner.
 
 11.5 Internal Security Audit - ONGC:
 
 Besides IB, ONGC carries out Security Audit of MRPL internally. ED
 Chief Security, ONGC also carries out periodical review of Security and
 gives his recommendations which are being implemented.
 
 11.6 Mock Drills:
 
 Regular mock drills are conducted exclusively on Security. Besides
 internal mock drills conducted within Security Department, district
 level security exercises are conducted along with State Police and
 Coast Guard. MRPL and industries in the neighborhood are actively
 involved in the Coastal Security Exercises conducted along the Coastal
 area under the leadership of Coast Guard.
 
 12.  CORPORATE SOCIAL RESPONSIBILITY (CSR) INITIATIVES
 
 As a socially responsive organisation your company is committed to the
 well being of the communities around the Refinery area and with this
 objective, it has taken up a number of schemes/ developmental
 activities during 2010- 11.The expenditure incurred on CSR activities
 during the year was Rs. 4.34 Crore (Rs. 12.54 Crore in previous year) in
 the core areas viz., Education, Health & Sanitation, Infrastructure,
 SC/ST Development Scheme, MRPL Rehabilitation Colony, Women Empowerment
 Programme.
 
 13.  DIRECTORS
 
 13.1 Shri A.K. Hazarika was appointed as Director w.e.f 1st February,
 2011, in place of Shri R.S Sharma consequent upon his superannuation
 from the services of ONGC on 31st January, 2011.
 
 13.2 Shri B.Ravindranath has been appointed as a Nominee Director on
 the Board of MRPL by IDBI Bank Limited w.e.f 1st November, 2010, in
 place of Shri G.M Ramamurthy
 
 13.3 Shri P.P. Upadhya has been appointed as Director (Technical) of
 MRPL by President of India. He has assumed the Office of Director
 (Technical) w.e.f 30th September, 2010.
 
 13.4 Shri Vishnu Agrawal has been appointed as Director (Finance) of
 MRPL by President of India. He has assumed the Office of Director
 (Finance) w.e.f 4th April, 2011.
 
 13.5 In accordance with the provisions of the Companies Act, 1956 and
 Article of Association of the Company, Shri K. Murali and Shri Sudhir
 Vasudeva Directors will retire by rotation at the 23rd Annual General
 Meeting of the Company. Shri K. Murali and Shri Sudhir Vasudeva, being
 eligible, offer themselves for re-appointment as Directors of the
 Company.
 
 13.6 Brief resume of the Directors seeking appointment /
 re-appointment, together with the nature of their expertise in specific
 functional areas, the names of the companies in which they hold the
 directorship and the membership / chairmanship of committees of the
 Board, and their shareholding in the Company as stipulated under Clause
 49 of the Listing Agreement with the Stock Exchange are given in the
 Annexure to the AGM notice.
 
 13.7 Your Company continues to pursue with the Government of India
 (Ministry of Petroleum & Natural Gas) for appointment of requisite
 number of Independent Directors on the Board of the Company for comply
 with clause 49(1A)(ii) of the Listing Agreement.
 
 14.  DIRECTORS'' RESPONSIBILITY STATEMENT
 
 In accordance with the provisions of Section 217 (2AA) of the Companies
 Act, 1956, your Directors state that:
 
 i) In the preparation of the Annual Accounts, the applicable accounting
 standards have been followed and that there are no material departures
 from the same.
 
 ii) They 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 viz., 31st March, 2011 and
 of the Profit & Loss of the Company for the year ended on that date.
 
 iii) They have taken proper and sufficient care for the maintenance of
 adequate accounting records in accordance with the provisions of the
 Companies Act, 1956 for safeguarding the assets of the Company and for
 preventing and detecting fraud and other irregularities;
 
 iv) They have prepared the Annual Accounts of the Company on a going
 concern basis.
 
 15.  FIXED DEPOSIT
 
 Your Company has not accepted any fixed deposit during the year from the
 public.
 
 16.  CORPORATE GOVERNANCE
 
 16.1 Your Company has complied with all the mandatory provisions of
 Clause 49 of the Listing Agreement relating to the Corporate Governance
 requirements, except with the requirement of requisite number of
 Independent Directors on the Board of the Company. Your Company is
 pursuing with the Administrative Ministry, MoP&NG for appointment of
 requisite number of Independent Directors on the Board. The Annual
 Report contains a separate section on Corporate Governance, which forms
 part of this Report.
 
 16.2 Your Company is listed with the Bombay Stock Exchange Limited and
 National Stock Exchange Limited.
 
 16.3 As required under Clause 49 of the Listing Agreement with Stock
 Exchanges, your company has obtained the Certificate from the Auditors
 of the Company, for Compliance of Corporate Governance which is annexed
 to and forms part of this report.
 
 16.4 As a measure of good corporate governance, your company has
 voluntarily taken up Secretarial Audit for the year 2010-2011 and a
 Report obtained from M/s. A.N. Kukreja & Co, Practicing Company
 Secretaries is annexed to the Annual Report, and forms part of this
 report.
 
 16.5 Your Company has also complied with the guidelines of corporate
 governance for Central Public Sector Enterprises (CPSEs), issued by DPE
 dated 14th May, 2010 except with regard to appointment of requisite
 number of Independent Directors.
 
 16.6 The Management Discussion and Analysis Report forms part of the
 Directors'' Report annexed as Annexure-II.
 
 17. AUDITORS
 
 17.1 M/s. S.R.R.K. Sharma Associates, Bangalore and M/s. Maharaj N. R.
 Suresh & Co., Chennai have been appointed as joint Statutory Auditors
 of the Company for the Financial Year 2010-11 by Comptroller & Auditor
 General of India (C&AG).
 
 17.2 The report of the C&AG at Annexure III forms part of this Report.
 
 17.3 Cost Audit branch of Ministry of Corporate Affairs (MCA) vide its
 order no. 52/61/CAB 2007 dated 24th January, 2007 has directed the
 company to maintain the cost accounts under the provisions of the
 Companies Act, 1956 and directed to conduct cost audit under section
 233(B)(1) of the Companies Act, 1956. M/s. Musib & Associates,
 Practicing Cost Accountant has conducted Cost Audit for the year ended
 2010-11. The Cost Audit Branch of Ministry of Corporate Affairs (MCA)
 has issued circular dated 11th April, 2011 w.e.f. 1st April, 2011 in
 supersession of earlier circular, whereby it requires the disclosures
 of details of the Cost Auditor and Cost Audit report for the year
 2011-12.
 
 17.4 Particulars of the Cost Auditor.
 
 (a) M/s. Musib and Associates, Cost Auditor for the year 2010-11.
 
 (b) Cost Audit report for the year 2010-11 will be fled before
 September, 2011.
 
 18.  ACKNOWLEDGEMENT
 
 18.1 Your Directors sincerely thank the Government of India (GOI),
 Ministry of Petroleum and Natural Gas (MOP&NG), Ministry of Finance
 (MOF), Ministry of Corporate Affairs (MCA), Department of Public
 Enterprise (DPE), Ministry of Environment and Forest (MOEF), Ministry
 of External Affairs, Ministry of Shipping, Ministry of Home Affairs
 other Ministries and Departments of the Central Government and the
 State Government of Karnataka, Andhra Pradesh, Tamilnadu, Kerala and
 District Authorities at Mangalore for their valuable support and
 continued co-operation.
 
 18.2 Your Directors gratefully acknowledge support and direction
 provided by the parent company, ONGC and the support of Hindustan
 Petroleum Corporation Limited (HPCL), as Promoters of the Company.
 
 18.3 Your Directors wish to thank the shareholders for the continued
 confidence reposed on the Management and the Company.
 
 18.4 Your Directors acknowledge the continuing co-operation and support
 received from New Mangalore Port Trust, Financial Institutions, Banks
 and all other stakeholders such as suppliers of crude oil and other
 inputs, vendors, contractors, transporters and others.
 
 18.5 Your Directors recognize the patronage extended by the valued
 customers for the products of the Company and promise to provide them
 the best satisfaction.
 
 18.6 Your Directors wish to place on record their sincere appreciation
 of the sustained and dedicated efforts put in by all the employees
 collectively and concertedly as a Team.
 
                                      For and on behalf of the Board
 
 
 
 Place: New Delhi                                      A.K. Hazarika
 
 Date: 4th July, 2011                                       Chairman