Petronet LNG Ltd
Chairman Speech
REPORT ON CORPORATE GOVERNANCE
FORMING PART OF DIRECTORS' REPORT
A Brief Statement on Company's Philosophy on Code of Corporate Governance
The Philosophy of the Company in relation to Corporate Governance is to ensure
transparent disclosures and reporting that conforms fully to laws, regulations and
guidelines, and to promote ethical conduct throughout the organization with the primary
objective of enhancing shareholders' value while being a responsible corporate citizen.
The Company firmly believes that any meaningful policy on Corporate Governance must
provide empowerment to the executive management of the Company, and simultaneously create
a mechanism of checks and balances which ensures that the decision-making power vested in
the executive management is used with care and responsibility to meet shareholders' and
stakeholders' aspirations. The Company is committed to attain the highest standards of
Corporate Governance.
Board of Directors
The total strength of the Board as on 31st March, 2013, was thirteen Directors as
detailed herein below:
S No |
Name |
Designation |
Category (Whole-time / Non-executive / Independent) |
1 |
Shri Vivek Rae |
Chairman, Secretary, Govt. of India, (MOP&NG) |
Independent |
2 |
Dr. A. K. Balyan |
Managing Director & CEO |
Whole-time |
3 |
Shri R. K. Garg |
Director (Finance) |
Whole-time |
4 |
Shri Rajender Singh |
Director (Technical) |
Whole-time |
5 |
Shri B. C. Tripathi |
Director, Nominee of GAIL |
Non-executive |
6 |
Shri R. K. Singh |
Director, Nominee of BPCL |
Non-executive |
7 |
Shri Sudhir Vasudeva |
Director, Nominee of ONGC |
Non-executive |
8 |
Shri A. M. K. Sinha |
Director, Nominee of IOCL |
Non-executive |
9 |
Mr. Dominique PELLOUX-PRAYER |
Director, Nominee of GDF International |
Non-executive |
10 |
Shri Tapan Ray |
Director, Nominee of GMB/GOG |
Independent |
11 |
Shri B. C. Bora |
Director |
Independent |
12 |
Shri Ashok Sinha |
Director |
Independent |
13 |
Shri R. Ram Mohan |
Director, Lender's Nominee |
Independent |
Board Meetings
During the year 2012-13, four Board Meetings were held on 24th April, 31st July, 19th
October, 2012, and 13th January, 2013. The attendance of each Director in the Board
Meetings and the last Annual General Meeting is detailed herein below:
Name of Directors |
Designation |
Number of Board Meetings held during the year 2012-13 |
Number of Board Meetings attended during the year 2012-13 |
Attendance at last Annual General Meeting held on 4th July, 2012 |
Executive Directors |
|
|
|
|
Dr. A. K. Balyan |
Managing Director & CEO |
4 |
4 |
yes |
Shri R. K. Garg |
Director (Finance) |
4 |
4 |
yes |
Shri C. S. Mani (upto 19th October, 2012) |
Director (Technical) |
4 |
3 |
yes |
Shri Rajender Singh ( w.e.f. 14th November, 2012) |
|
|
1 |
NA |
Non-executive Directors |
|
|
|
|
Shri B. C. Tripathi |
Nominee Director of GAIL |
4 |
2 |
No |
Shri R. K. Singh |
Nominee Director of BPCL |
4 |
2 |
No |
Shri Sudhir Vasudeva |
Nominee Director of ONGC |
4 |
3 |
No |
Shri A. M. K. Sinha |
Nominee Director of IOCL |
4 |
3 |
No |
Mr. Dominique PELLOux-PRAYER *(Two Board meetings attended by Mr. Eric Ebelin as an
Alternate Director) |
Nominee Director of GDF International |
4 |
4 |
No |
Non-executive Independent Directors |
|
|
|
|
Shri G. C. Chaturvedi (upto 31st January, 2013) |
Chairman |
4 |
3 |
yes |
Shri Vivek Rae (w.e.f. 21st February, 2013) |
|
|
NIL |
NA |
Shri Tapan Ray |
Independent Director |
4 |
2 |
No |
Shri B. C. Bora |
Independent Director |
4 |
4 |
yes |
Shri Ashok Sinha |
Independent Director |
4 |
4 |
yes |
Shri R. Ram Mohan (w.e.f. 19th October, 2012) |
Independent Director |
4 |
1 |
NA |
Detail of Directorship / Membership / Chairmanship on the Board / Committees of the
other Companies and Shareholding in the Company as on 31.03.2013
Name |
No. of other Companies in which
Directorship / Chairmanship is held |
No. of Membership / Chairmanship held
in Committees of Board of other Companies |
No. of Shares held in the Company |
|
Directorship |
Chairmanship |
Membership |
Chairmanship |
|
Shri Vivek Rae |
NIL |
1 |
NIL |
NIL |
NIL |
Dr. A. K. Balyan |
2 |
NIL |
NIL |
NIL |
400 |
Shri R. K. Garg |
2 |
NIL |
NIL |
NIL |
5300 |
Shri Rajender Singh |
NIL |
NIL |
NIL |
NIL |
NIL |
Shri B. C. Tripathi |
NIL |
4 |
1 |
NIL |
NIL |
Shri R. K. Singh |
1 |
5 |
NIL |
1 |
400 |
Shri Sudhir Vasudeva |
NIL |
7 |
NIL |
NIL |
800 |
Shri A. M. K. Sinha |
1 |
1 |
NIL |
NIL |
600 |
Mr. Dominique PELLOlix-PRAYER |
1 |
NIL |
NIL |
NIL |
NIL |
Shri Tapan Ray |
11 |
1 |
3 |
2 |
NIL |
Shri B. C. Bora |
1 |
NIL |
NIL |
NIL |
NIL |
Shri Ashok Sinha |
2 |
NIL |
2 |
Nil |
NIL |
Shri R. Ram Mohan |
NIL |
NIL |
NIL |
NIL |
NIL |
Note: -
As per Clause 49, the above details are required to be disclosed only for the following
three committees:
1 Audit Committee
2 Shareholders/Investors Grievance Committee
3 Remuneration Committee
Remuneration paid to Whole-time Directors and to Non-executive Directors during the
year ended 31st March, 2013
The remuneration to Whole-time Directors is being paid as per terms of their
appointment. The Company pays remuneration by way of salary, perquisites, allowances and
commission to Whole-time Directors. The commission is calculated with reference to profits
of the Company in a particular year and is determined by the Board and Shareholders,
subject to overall ceiling as prescribed in the Companies Act, 1956.
The details of remuneration paid to the Whole-time Directors during the year are stated
herein below:
(In Rupees)
S. No. |
Name |
Designation |
Salaries & Allowances |
Contribution to PF & Gratuity Fund |
Other Benefits & Perks |
Commission payable on Profit for the year 2012-13 |
Total |
1 |
Dr. A. K. Balyan |
Managing Director & CEO |
50,82,552 |
2,89,548 |
6,22,429 |
20,00,000 |
79,94,529 |
2 |
Shri C. S. Mani |
Director (Technical) (upto 19th October, 2012) |
30,18,243 |
7,04,091 |
15,34,806 |
11,06,849 |
63,63,989 |
3 |
Shri R. K. Garg |
Director (Finance) |
38,51,363 |
2,01,701 |
7,03,904 |
20,00,000 |
67,56,968 |
4 |
Shri Rajender Singh |
Director (Technical) (w.e.f. 14th November, 2012) |
12,58,444 |
69,048 |
2,18,992 |
7,56,164 |
23,02,648 |
The details of the sitting fees paid to Non-executive Directors or their nominated
Organization / Company during the year ended 31st March, 2013, is as detailed below:
S. No. |
Name |
Sitting Fees paid during 2012-13 (Rs.) |
1 |
Mr. Dominique Pelloux - Prayer/ Mr. Eric Ebelin |
1,00,000 |
2 |
Government of India |
80,000 |
3 |
Bharat Petroleum Corporation Ltd. |
80,000 |
4 |
Oil & Natural Gas Corporation Ltd. |
1,20,000 |
5 |
Indian Oil Corporation Ltd. |
1,80,000 |
6 |
GAIL (India) Ltd. |
60,000 |
7 |
Gujarat Maritime Board |
40,000 |
8 |
Shri B. C. Bora |
2,00,000 |
9 |
Shri Ashok Sinha |
2,20,000 |
10 |
Shri R. Ram Mohan (w.e.f. 19th October, 2012) |
20,000 |
*Alternate Director to Mr. Dominique Pelloux-Prayer
In addition to the above, Commission on Profits is also payable to the following
Independent Directors:
S. No. |
Name |
Commission payable on Profit for the year 2012-13 (Rs.) |
1 |
Shri B. C. Bora |
7,50,000 |
2 |
Shri Ashok Sinha |
7,50,000 |
Terms of appointment of Whole-time Directors
The Company has the following Whole-time Directors as on 31st March, 2013:
1. Dr. A. K. Balyan, Managing Director & CEO
2. Shri R. K. Garg, Director (Finance)
3. Shri Rajender Singh, Director (Technical)
The initial tenure of Whole-time Director(s) is for a period of five years w.e.f. their
respective date of appointment. However, the tenure of Whole-time Directors may further be
extended by re-appointing them, subject to approval by Members in the Annual General
Meeting.
The appointment of Whole-time Directors is subject to termination by a three-month
notice in writing by either party.
Audit Committee
The Audit Committee comprises the following Directors as on 31st March, 2013:
1 Shri Ashok Sinha, Chairman
2 Shri B. C. Bora, Member
3 Shri A. M. K. Sinha, Member
4 Shri R. Ram Mohan, Member
All the Members of Audit Committee are Non-executive Directors and three out of four
Members are Independent Directors, namely Shri Ashok Sinha, Shri B. C. Bora and Shri R.
Ram Mohan. The quorum of the Audit Committee is two Members.
The Chairman of the Audit Committee also attended the last Annual General Meeting of
the Company held on 4th July, 2012.
The Company Secretary is the Secretary of the Audit Committee.
Detail of Meetings of Audit Committee held during the year
Member |
No. of Meetings Held |
No. of Meeting Attended |
Shri Ashok Sinha |
4 |
4 |
Shri B. C. Bora |
4 |
4 |
Shri A. M. K. Sinha |
4 |
3 |
Shri R. Ram Mohan, Independent Director (Appointed as member w.e.f. 13th January,
2013) |
4 |
Nil |
Terms of Reference of Audit Committee
The primary function of the Audit Committee is to assist the Board of Directors in
fulfilling its oversight responsibilities by reviewing the financial reports and other
financial information provided by the Company to any Government Body or to the investors
or the public; the company's system of internal controls regarding finance, accounting and
legal compliances that the Management and the Board have established.
The terms of reference of Audit Committee include inter-alia the following:
Oversee the Company's financial reporting process and disclosure of its
financial information to ensure that the financial statement is correct, sufficient and
credible.
Recommending the appointment and removal of statutory and internal auditors
(wherever required), fixation of audit fee and also approval for payment for any other
services.
Reviewing with the Management the quarterly, half-yearly and the annual
financial statements before submission to the Board, focusing primarily on:
- Any changes in accounting policies and practices.
- Major accounting entries based on exercise of judgment by the Management.
- The going-concern assumption.
- Compliance with accounting standards.
- Compliance with Stock Exchange(s) and Legal requirements concerning financial
statements.
- Any related party transactions, i.e. transactions of the Company of material nature,
with Promoters or the Management, or relatives etc. that may have potential conflict with
the interest of the Company at large.
Reviewing with the Management, statutory and internal auditors, the adequacy and
compliance of internal control systems.
Reviewing the adequacy of internal audit function, reporting structure coverage
and frequency of internal audit.
Discussion with internal auditors about any significant findings and follow-up
thereon.
Reviewing the findings of any internal investigations by the internal auditors
into matters where they are suspected of any fraud or irregularity or a failure of
internal control systems of a material nature and reporting the matter to the Board.
Discussion with statutory auditors about the scope of audit as well as have
post-audit discussion to ascertain any area of concern.
Reviewing the company's financial and risk-management policies.
Shareholders' / Investors' Grievance Committee
As on 31st March, 2013, the Shareholders'/Investors' Grievance Committee comprises the
following Directors:
1 Shri Ashok Sinha, Chairman
2 Shri A. M. K. Sinha, Member
3 Shri R. K. Garg, Member
4 Shri Rajender Singh*, Member
The Company Secretary is the Compliance Officer of the Company.
One Meeting of the Shareholders'/Investors' Grievance Committee was held on 13th
January, 2013 which was attended by all the memebers of the committee.
* (Appointed as member w.e.f. 13th January,2013)
Details of Complaints received and redressed during the year ended 31st March, 2013
2 complaints were pending as on 1st April, 2012. 1,206 complaints were received and
1,203 complaints were resolved during the year. Only 5 complaints were pending as on 31st
March, 2013.
Share Transfer Committee
The Share Transfer Committee was constituted to deal with the cases like
re-materialization of shares, transfer, transposition and splitting of shares in physical
mode. The Share Transfer Committee comprises Whole-time Directors, namely,
1 Dr. A. K. Balyan, Managing Director & CEO
2 Shri R. K. Garg, Director (Finance)
3 Shri Rajender Singh, Director (Technical)
Dr. A. K. Balyan, Managing Director & CEO, is the Chairman of the Committee.
Remuneration Committee
The Remuneration Committee was constituted by the Board to determine the Remuneration
Package for Executive Directors. The following Directors are the Members of the
Remuneration Committee as on 31st March, 2013:
1. Shri Ashok Sinha, Chairman
2. Shri B. C. Bora, Member
3. Shri Sudhir Vasudeva, Member
One meeting of the Remuneration Committee was held on 24th April, 2012.
Risk Assessment & Minimisation Procedure
The Company has laid down procedures to inform the Members of the Board about the risk
assessment and minimization procedure. A Risk Management Committee consisting of
Whole-time Directors periodically reviews the procedures to ensure that Executive
Management controls risk through properly defined framework. The risk assessment framework
encompassed, inter-alia, methodology for assessing risks on ongoing basis, risk
prioritization, risk mitigation, monitoring plan and comprehensive reporting system.
Legal Compliance Reporting
As required under Clause 49 of the Listing Agreement, the Board periodically reviews
compliances of various laws applicable to the Company.
Annual General Meetings (AGMs)
The details of last three Annual General Meetings are as mentioned below:
Year |
2009-10 |
2010-11 |
2011-12 |
Date & Time |
24th June, 2010 at 10:00 AM. |
30th June, 2011 at 10:00 AM. |
4th July, 2012 at 10:00 AM |
Venue |
Air Force Auditorium, Subroto Park, Dhaula Kuan, New Delhi-110010 |
Air Force Auditorium, Subroto Park, Dhaula Kuan, New Delhi-110010 |
Air Force Auditorium, Subroto Park, Dhaula Kuan, New Delhi-110010 |
Details of Special Resolutions |
1) Appointment of Statutory Auditors |
1) Appointment of Statutory Auditors |
1) Appointment of Statutory Auditors |
|
2) Amendment of Articles of Association |
2) Approval for payment of Commission on profit to Directors |
2) Approval for Employee Stock Option Scheme |
Resolutions passed through Postal Ballot |
Nil |
Nil |
Nil |
Extraordinary General Meeting(s) (EGMs)
During the year 2012-13, no Extraordinary General Meeting of the Members of the Company
was held.
Disclosure
During the year 2012-13, no material transactions with the Directors or the Management,
their subsidiaries or relatives etc. have taken place, which have potential conflict with
the interest of the Company.
Compliance
There has been no non-compliance of the provisions/requirements of Stock
Exchanges/SEBI. No penalties/strictures have been imposed on the Company by the Stock
Exchanges or SEBI or any other statutory authority on any matter relating to the Capital
Market.
Means of Communication
The Company's website (www.petronetlng.com) has updated details about the Company, its
project status, Shareholding pattern on quarterly basis, etc. The financial results are
being posted on the Company's website. The Company also has an exclusive e-mail ID
(investors@petronetlng.com) for investors to contact the Company in case of any
information and grievances. The financial results were also published in National Daily
Newspapers in terms of Listing Agreement.
General Shareholders Information Annual General Meeting (AGM)
Day & Date |
4th July, 2013 |
Time |
10:00 AM |
Venue |
Air Force Auditorium, Subroto Park, Dhaula Kuan, New Delhi-110010 |
Date of Book Closure |
24th June, 2013, to 4th July, 2013 (Both days inclusive) |
Dividend Payment Date
The dividend, if approved by the Members of the Company, will be paid on or after 16th
July, 2013.
Financial Calendar
Petronet LNG Ltd. follows the financial year from April to March. The Un-audited
Financial Results for the first three quarters and the Audited Financial Results for the
year ended 31st March, 2013, were taken on record and approved by the Board in its
meeting(s) held on the following dates:
Quarter Ended |
Date of Board Meeting |
April - June, 2012 |
31st July, 2012 |
July - September, 2012 |
19th October, 2012 |
October-December, 2012 |
13th January, 2013 |
Year Ended |
|
31st March, 2013 |
30th April, 2013 |
Listing on Stock Exchange(s)
Name of Stock Exchanges |
Stock Code |
The Stock Exchange, Mumbai (BSE) |
532522 |
The National Stock Exchange of India Limited (NSE) |
PETRONET |
Market Price Data: High and Low during each month in the last financial year
Month |
BSE (in Rs.) |
NSE (in Rs.) |
|
High |
Low |
High |
Low |
April, 2012 |
175.00 |
135.20 |
174.90 |
135.00 |
May, 2012 |
145.25 |
122.25 |
145.35 |
122.00 |
June, 2012 |
149.50 |
125.40 |
149.80 |
125.30 |
July, 2012 |
150.65 |
139.55 |
150.80 |
139.25 |
August, 2012 |
155.45 |
144.60 |
155.40 |
144.55 |
September, 2012 |
172.95 |
152.20 |
172.65 |
150.65 |
October, 2012 |
171.20 |
157.50 |
180.00 |
157.25 |
November, 2012 |
175.15 |
153.90 |
175.35 |
153.65 |
December, 2012 |
165.70 |
153.55 |
165.70 |
157.00 |
January, 2013 |
168.80 |
150.90 |
168.70 |
150.55 |
February, 2013 |
156.20 |
140.00 |
156.30 |
139.60 |
March, 2013 |
150.80 |
127.15 |
150.75 |
126.75 |
Distribution Schedule as on 31st March, 2013
Category (Amount) |
No. of Cases |
% of Cases |
Total Shares |
Amount in Rs. |
% of Amount |
Up to - 5000 |
3,26,964 |
89.51 |
5,06,24,071 |
50,62,40,710 |
6.75 |
5001 - 10,000 |
24,974 |
6.84 |
1,95,93,154 |
19,59,31,540 |
2.61 |
10,001 - 20,000 |
8,381 |
2.29 |
1,23,04,032 |
12,30,40,320 |
1.64 |
20,001 - 30,000 |
1,923 |
0.53 |
49,29,379 |
4,92,93,790 |
0.66 |
30,001 - 40,000 |
821 |
0.22 |
29,30,880 |
2,93,08,800 |
0.39 |
40,001 - 50,000 |
602 |
0.16 |
28,47,433 |
2,84,74,330 |
0.38 |
50,001 - 1,00,000 |
813 |
0.22 |
58,97,181 |
5,89,71,810 |
0.79 |
1,00,001 & Above |
838 |
0.23 |
65,08,73,914 |
6,50,87,39,140 |
86.78 |
TOTAL |
3,65,316 |
100.00 |
75,00,00,044 |
7,50,00,00,440 |
100.00 |
Shareholding Pattern of the Company as on 31st March, 2013
Category |
No. of Shares Held |
% of Shareholding |
A Promoter's holding |
|
|
1 Promoters |
|
|
Indian Promoters |
37,50,00,000 |
50.00 |
Foreign Promoters |
Nil |
Nil |
Sub- Total (A) |
37,50,00,000 |
50.00 |
B Non- Promoters holding |
|
|
1 Institutional Investors |
|
|
a Mutual Funds and IITI |
6,72,80,381 |
8.97 |
b Banks, Financial Institutions |
1,50,953 |
0.02 |
c Insurance Companies / Central / State Govt. Institutions / Non-government
Institutions / Venture Capital Funds |
1,40,000 |
0.02 |
d FII's (Including ADB holding) |
10,26,46,886 |
13.69 |
Sub-Total (B1) |
17,02,18,220 |
22.70 |
2 Others |
|
|
a Private Corporate Bodies |
1,78,19,673 |
2.38 |
b Indian Public including HUF and Foreign Nationals |
10,63,62,860 |
14.18 |
c NRI's / OCB's (Including GDFI) |
7,89,29,492 |
10.52 |
d Any other (Clearing Members & Trusts) |
16,69,799 |
0.22 |
Sub-Total (B2) |
20,47,81,824 |
27.30 |
GRAND TOTAL (A+B1+B2) |
75,00,00,044 |
100.00 |
List of Shareholders Holding More than 1% of Equity Capital as on 31st March, 2013
Name |
No. of Shares Held |
% of Shareholding |
Promoter's Holding |
|
|
Bharat Petroleum Corporation Ltd. |
9,37,50,000 |
12.50 |
GAIL (India) Ltd. |
9,37,50,000 |
12.50 |
Indian Oil Corporation Ltd. |
9,37,50,000 |
12.50 |
Oil & Natural Gas Corporation Ltd. |
9,37,50,000 |
12.50 |
Non-promoters Holding |
|
|
GDF International |
7,50,00,000 |
10.00 |
Asian Development Bank |
3,90,00,000 |
5.20 |
Detail of Unclaimed Shares as on 31.03.2013 issued pursuant to Initial Public Offer
(IPO)
S. No. |
Particulars |
Cases |
No. of shares |
1 |
Aggregate Number of shareholders and the outstanding shares in the suspense account
(i.e. KCL ESCROW ACCOuNT PETRONET LNG IPO-OFFER) lying at the beginning of the year i.e.
1st April, 2012. |
649 |
1,32,700 |
2 |
Number of shareholders who approached for transfer of shares from suspense account
during the year. |
2 |
300 |
3 |
Number of shareholders to whom shares were transferred from suspense account during
the year. |
1 |
200 |
4 |
Aggregate number of shareholders and outstanding shares in the suspense account at the
end of year, i.e. 31st March, 2013. |
648 |
1,32,500 |
Code of Conduct for Board Members & Senior Management Personal
The Board of Directors of the Company approved Code of Conduct for Board Members &
Senior Management Personnel and the same was made effective from 1st April, 2006. A copy
of the same has also been hosted on the website of the Company. All the Board Members and
Senior Management Personnel have affirmed compliance with the said Code for the year ended
31st March, 2013.
CEO/CFO Certification
A certificate from the Managing Director & CEO and Director (Finance) on the
financial Statements of the Company in terms of Clause 49 of Listing Agreement was placed
before the Board, who took the same on record.
Related Party Transactions
The details of all significant transactions with related parties are periodically
placed before Audit Committee.
Reconciliation of Share Capital Audit
A qualified practicing Company Secretary carried out a Reconciliation of Share Capital
Audit on quarterly basis to reconcile the total Share Capital with National Securities
Depository Limited (NSDL), Central Depository Services Limited (CDSL) and the total issued
and listed capital. The audit confirms that the total issued/paid-up capital is in
agreement with total number of shares in physical forms and total number of dematerialized
shares held with NSDL and CDSL.
Status of Corporate Governance Voluntary Guidelines 2009
The voluntary guidelines issued by Ministry of Corporate Affairs in December 2009,
pertaining to Corporate Governance are complied with to the extent found feasible.
Major Plant / Unit Location(s) |
|
Dahej LNG Terminal |
Kochi LNG Project Site |
GIDC Industrial Estate, |
Survey No. 347, |
Plot No 7/A, Dahej, |
Puthuvypu (Puthuypeeen SEZ), |
Taluka: Vagra, Distt. Bharuch, |
P.O. 682508, Kochi, |
Gujarat - 392130 |
Kerala |
Tel : 02641-253182/257004-257007 |
Tel: 0484-2502259 |
Fax: 02641-253179/300310 |
Fax : 0484-2502264 |
Address for Correspondence |
|
Registered & Corporate Office |
Registrar & Share Transfer Agent |
Petronet LNG Limited |
M/s Karvy Computershare Pvt. Limited |
World Trade Centre, First Floor, |
Plot No. 17 to 24, |
Babar Road, Barakhamba Lane, |
Vittal Rao Nagar, |
New Delhi - 110 001 |
Madhapur, Hyderabad - 500081 |
Tel: 011- 23472525, 23411411 |
Tele: 040-23312454,23320751/52 |
Fax: 011- 23472550 |
Fax: 040-23311968,23323049 |
Email: investors@petronetlng.com |
|
Auditors' Certificate on Compliance with the conditions of Corporate Governance
under clause 49 of the Listing Agreements
To the Shareholders of Petronet LNG Limited
1. We have examined the compliance of conditions of Corporate Governance by Petronet
LNG Limited ("the Company") for the year ended March 31st, 2013 as stipulated in
clause 49 of the Listing Agreements of the said company with Stock Exchanges in India.
2. The compliance of conditions of Corporate Governance is the responsibility of the
Company's management. Our examination was limited to the review of procedures and
implementation thereof, adopted by the Company or ensuring the compliance of the
conditions of Corporate Governance. It is neither an audit nor an expression of opinion on
the financial statements of the Company.
3. In our opinion and to the best of our information and according to the explanations
given to us, we certify that the Company has complied with the conditions of Corporate
Governance as stipulated in the above mentioned Listing Agreement.
4. We further state that such compliance is neither an assurance as to the future
viability of the Company nor the efficiency or effectiveness with which the management has
conducted the affairs of the Company.
|
For T.R. Chadha & Co. |
|
Chartered Accountants |
|
(Firm Registration No. 006711N) |
|
Sd/- |
|
Neena Goel |
Place : New Delhi |
Partner |
Date : 29th May, 2013 |
M.N.057986 |
BUSINESS RESPONSIBILITY REPORT
Section 1: About our Company |
|
1. Corporate Identity Number (CIN) of the Company |
: L74899DL1998PLC093073 |
2. Name of the Company |
: Petronet LNG Ltd.(PLL) |
3. Registered address |
: World Trade Centre, First Floor, Babar Road, Barakhamba Lane, New Delhi - 110 001 |
4. Website |
: http://www.petronetlng.com |
5. E-mail id |
: investors@petronetlng.com |
6. Financial Year reported |
: April 2012 - March 2013 |
7. Sector that the Company is engaged in |
: Oil & Gas |
8. Product provided by the Company |
: Regasified Liquefied Natural Gas (LNG) |
9. Total number of locations where business activity is undertaken by the Company: |
|
a. International Locations |
: Qatar (primarily) and various other countries of the world (for sourcing of LNG) |
b. National Locations |
: Dahej in Gujarat, Kochi in Kerala and New Delhi. |
10. Markets served by the Company |
: Pan-India |
Section 2: Our financial details |
|
1. Paid up capital (INR) |
: 750 crores |
2. Total turnover (INR) |
: 31,649 crores |
3. Total profit after taxes (INR) |
: 1,149 crores |
4. Total spending on Corporate Social Responsibility (CSR) as percentage of profit
after tax (%) |
: 0.32% |
5. Activities in which CSR expenditure has been incurred |
|
Community Development |
Healthcare |
Education |
Water Management |
Disaster relief |
Sports and Culture |
Fostering Entrepreneurship |
|
Section 3: Other details |
|
Subsidiary companies |
: The Company does not have any subsidiary Company. |
Section 4: BR information
1. Details of Director/Directors responsible for Business Responsibility
a. Details of the Director/Directors responsible for implementation of the BR
policy/policies
i. DIN Number |
: 00793181 |
ii. Name |
: Dr. A. K. Balyan |
iii. Designation |
: MD & CEO |
b. Details of the BR head
S.No. |
Particulars |
Details |
1. |
DIN Number |
00793181 |
2. |
Name |
Dr. A. K. Balyan |
3. |
Designation |
MD & CEO |
4. |
Telephone number |
011 - 23472503 / 04 |
5. |
e-mail id |
md.ceo@petronetlng.com |
Governance related to Business Responsibility
In our Company, compliance is the Board's responsibility and the members take it very
seriously, thus ensuring regular evaluation of the Company's sustainability performance.
We have a Risk Management Committee to identify and mitigate all types of risks pertaining
to the business of the Company. The Committee meets regularly to discuss various risks and
mitigating factors for the same. The Board reviews and approves the annual business plans.
The decisions on all strategic matters related to capital expenditure, revenue, etc. are
taken with the approval of the Board. It also discusses and deliberates on issues
pertaining to risk management, safety performance, and monitors compliance to applicable
statutes and norms.
Our detailed sustainability performance will be published in our first Sustainability
Report - Partners of Clean Energy. This report will be available on our website from July,
2013, onwards.
Nine Business Responsibility Principles
Principle 1: Businesses should conduct and govern themselves with Ethics, Transparency
and Accountability
As part of our Company's endeavor to set high standards of conduct for its employees, a
Code of Business Conduct and Ethics has been laid down for all Board Members and Senior
Management personnel. The Code, which was approved by the Board in 2006, encompasses
general moral imperatives, specific professional responsibilities, and additional duties /
imperatives for the Board Members and Senior Management personnel. From 1st April, 2006,
strict adherence to the Code has been mandatory for all. The Code reflects our thorough
belief in maintaining the highest standards of business ethics, which takes into account
our business performance and its impact on society. All members have affirmed compliance
to the Code in the reporting period. Besides being available on our website, copies of the
Code are circulated to all the individuals concerned.
Anti-corruption
Corruption is one of the world's greatest challenges. It is a major hindrance to
sustainable development and corrodes the very fabric of the society. Petronet LNG Ltd.
(PLL) strongly believes in maintaining integrity and work ethics to protect not just the
reputation of the Company but also the interests of its shareholders.
We have identified that the major potential source of corruption could be contracts
awarded for construction of various facilities in an LNG Terminal. In order to mitigate
the risk, the EPC Sub-Committee of the Board, which is responsible for evaluating and
recommending large EPC contracts for Board approval, has an Independent Director as a
Member. In addition to this, we also have safeguards in place in the tender documents
which discourage bidders from indulging in any corrupt practice. In case of any such act
of misconduct, it is within our rights to reject the bid or contract, as the case may be.
Further, to strengthen our commitment to anti-corruption practices and principles, we
have been a member of Global Compact Network (GCN) since the last three years. We have
committed to the principles and practices of the Global Compact that includes the ten
principles pertaining to human rights, labour standards, environment and anti-corruption.
PLL has submitted its first Communication on Progress (CoP) for 2011-12 that details our
willingness to actively support the efforts made by GCN.
As part of our mission statement, we believe in maintaining highest standard of
business ethics and values.
Principle 2: Businesses should provide goods and services that are safe and
contribute to sustainability throughout their life cycle
At present, PLL deals primarily in one business segment: the import, storage and
re-gasification of Liquefied Natural Gas (LNG). The product composition is dominated by
methane, with varying portions of ethane, propane and butane. Natural Gas is cooled to
minus 160C to liquefy, which facilitates transportation. LNG is transported in cryogenic
tankers across seas to our terminal, where it is re-gasified and then distributed.
PLL has branded its product as" Taral3" -the new-age eco-friendly
fuel. It is proposed to be delivered to customers not connected with pipeline near our
Terminals.
Three LNG ships - 'Disha', 'Raahi' and 'Aseem', bring LNG from RasGas, Qatar, to Dahej,
transporting the contracted quantity of 7.5 MMTPA of LNG. Further, 1.44 MMTPA will be
imported from Australia.
Product responsibility forms the very basis of the existence of our Company. Our
product itself being clean energy, there are no sustainability challenges arising from the
impact of our product. Having said that, there have been no instances of complacency and
PLL is committed to diligence when it comes to taking responsibility for our product,
including its provision, transportation and use. We are entirely compliant with all
existing regulations and during the reporting period, have not paid any fine for
non-compliance.
While we ensure that there is minimal environmental impact from transporting LNG across
India, sourcing from local suppliers is not a valid option, given the nature of the
product. Further, the product doesn't produce any waste. Hence, recycling is also not
applicable.
Principle 3: Businesses should promote the wellbeing of all employees
We believe a Company is as good as its people. Given our constant drive for success,
our employees form the most important part of our DNA. As on 31st March 2013, our total
employee strength stands at 397. The detailed break-up of our workforce will be available
in our Sustainability Report.
We engage the services of contractors at our facilities. In FY 2012-13, 477 contractual
workers (annual average) were operating in our Dahej facility. Additionally, for the
construction project of our second jetty at Dahej, we engaged the services of a contractor
who employed approximately 950 (annual average) personnel at the project site.
We look at collective bargaining as an employee's right and do not object to it in any
way. However, the culture of an organized employee union or association does not exist in
our Company.
Child and forced labour
To eliminate any instance of child labour, we ensure strict adherence to the minimum
age provisions of National Labour Laws and Regulations. Being a part of the hydrocarbon
industry, we have stringent rules for hiring. Forced labour too, holds similar stances on
our part, culminating in a clearly defined exit policy and a zero-tolerance approach to
this violation of human rights.
Enhancing potential
Attracting, motivating, and retaining talented employees today, given the competitive
market, is a major challenge we must give adequate importance to.
Through our training programs, we would like to benchmark and enhance competencies
which will address workforce issues on which the Company could capture value and make a
tangible positive impact of a learning organization.
The number of hours spent on training for our employees in the reporting period (in
man-hours) is as follows:
Employee category |
FY 2012-13 |
|
Male |
Female |
Senior Management |
136 |
NA |
Mid Management |
2483 |
82 |
Junior Management |
5192 |
377 |
GETs / PGETs |
592 |
131 |
Staff |
4223 |
409 |
Further, PLL has a robust Quality, Health, Safety and Environment Policy which is
circulated and emphasized to all our employees to help inculcate a culture of safety on
our premises.
Principle 4: Businesses should respect the interests of, and be responsive, towards
all stakeholders, especially those who are disadvantaged, vulnerable and marginalized.
We, at PLL, believe that stakeholder engagement plays a vital role in improving
sustainability performance. It enables a better understanding of the reasonable
expectations and interests of stakeholders, allowing the Company to better manage and
respond to their concerns. Interacting with stakeholders and responding to stakeholders'
expectations and feedback on the organization's performance confer many benefits on those
that undertake genuine stakeholder engagement. Engagement is not only a trust-building
exercise, but can also give us a first-mover advantage in opportunities with relation to
the stakeholder groups consulted.
Stakeholder identification
Stakeholder identification is about defining the different groups of individuals or
institutions that affect, or are affected by PLL's business operations in some capacity.
We have identified our stakeholders on the basis of the parameters of responsibility,
influence, proximity, dependency and representation.
The Government, our shareholders, employees, suppliers, contractors, customers and
communities are key stakeholders, amongst others.
Though not disadvantaged or vulnerable, communities operating in and around our Dahej
Terminal need some assistance for faster development and we, at PLL, have provided support
to facilitate the same.
In this context, we would like to mention an initiative in Luwara village situated near
our Dahej Terminal. We have contributed significantly to the overall development of the
village, specifically focusing on primary healthcare. Our contribution in other schemes,
like improving drinking water facilities, installing solar street lights, development of
school infrastructure, etc., has also been significant.
Principle 5: Businesses should respect and promote human rights
Our policies related to human rights are all-encompassing and thorough. We expect all
our contractors and suppliers to also follow them. Some of the policies are as follows:
It is the policy of the Company to provide employment opportunity, regardless of
race, color, gender, religion, age, sexual orientation, national or ethnic origin,
disability, marital status, veteran status, or any other occupationally irrelevant
condition.
The above policy applies to recruitment, hiring and job assignment, promotion,
demotion and transfer, layoff or termination, rates of pay and benefits, selection for
training and the provision of any other human resources service.
The continuing progress and vitality of the Company requires that we utilize all
available human resources to the fullest. The continuing need for well-qualified personnel
dictates that individuals with talent must be recognized and encouraged to progress.
The Company treats its employees with fairness and is deeply interested in their
growth and development. The Company expects its employees to adhere to the established
standards of conduct and performance to enable all to work together to achieve the
objectives of the Company.
There have been no complaints regarding breach of human rights in the reporting year.
Principle 6: Business should respect, protect, and make efforts to restore the
environment
Our Quality, Health, Safety, and Environment (QHSE) Policy is displayed at prominent
locations within our Dahej Terminal. We expect our employees, contractors and suppliers to
adhere to the principles outlined in the policy.
At PLL, not only do we import cleaner fuel and propel India towards low carbon growth,
we also ensure energy efficiency, water conservation and other environment friendly
activities in our operations. We take our role in contributing to a better environment
seriously and assess all potential environmental risks of our operations.
Energy and emissions
Our primary energy sources are Natural Gas and Diesel. In 2012-13, 2.48 million GJ of
primary energy was consumed in our operations. Natural Gas is the main fuel constituting
nearly 95% of the energy consumed. Captive power generation using Natural Gas contributes
92.39 % of the total carbon dioxide emissions from our operations.
As our processes are already environmentally clean, we do not have any Clean
Development Mechanism (CDM) projects.
Water management
Our operations do not necessitate consumption of large quantities of water. Yet, we
have undertaken certain innovative measures to reduce water consumption in our operations.
Waste management
We, at PLL, have robust waste management systems in place. All hazardous waste
generated in our facility is responsibly disposed through authorized waste recyclers.
Biodiversity management
The Company has undertaken measures towards protecting the marine ecology in the area
of its operations.
All our emissions/waste, etc. are well within regulatory limits.
Details of our environmental performance will be available in our Sustainability
Report.
Principle 7: Businesses, when engaged in influencing public and regulatory policy,
should do so in a responsible manner
For the past three years, we have been a part of the Global Compact Network. Our
Company is also a member of the Standing Conference of Public Enterprises (SCOPE) and the
International Group of Liquefied Natural Gas Importers (GIIGNL). Our Senior Management
represents the Company in various industry forums. We understand our responsibility as an
influential part of the economy and do not engage in influencing public policy with vested
interests.
Principle 8: Businesses should support inclusive growth and equitable development
As a responsible corporate citizen of the country, PLL has dedicated itself wholly to
the betterment of India, through business, by providing clean energy, and through constant
community engagement. Socio-economic development programmes are undertaken by our Company
in order to meet the priority needs of the community we operate in, envisioning
self-sustaining communities in the near future. We have designated CSR roles and
responsibilities to ensure thorough implementation of our plans. Spearheading it at the
Board level is our MD & CEO who is responsible for the overall CSR planning and
implementation.
At the Corporate level, the Head HR, in consultation with Executive Committee (EC), is
responsible for the formulation of plans and strategies, annual fund allocation, periodic
monitoring and evaluation of activities to be taken up by terminals, documentation, brand
enhancement and active CSR involvement at the Corporate office.
Similarly at the Dahej Terminal, CSR is undertaken by the Plant Head, who is
responsible for identification of appropriate schemes, in consultation with concerned
executives in the field, examination and consolidation of proposals, maintenance of data
records, etc.
Further, we constantly motivate our employees to engage in the CSR schemes as a
voluntary philanthropic contribution to the society we live in.
Our community initiatives
At the Corporate level, emphasis is laid on providing support for disaster relief
management, water management, education, healthcare, promotion of sports, art and culture,
entrepreneurship, environment, etc. Similarly, at the LNG terminals priority is given to
education, healthcare including drinking water, environment and entrepreneurship schemes.
Investments
Each development project at PLL has a CSR component as a part of the project cost now.
Since FY 2012-13, we have been allocating a certain part of our profit for CSR activities.
We work closely with the local Gram Panchayat and District administration. A couple of
major schemes, such as sweet drinking water facilities for Bharuch and mangrove
plantations for environmental development near Dahej, are under implementation in
collaboration with the State Governments in which PLL has made substantial contribution.
Principle 9: Businesses should engage with and provide value to their customers and
consumers in a responsible manner
We, at PLL, follow the highest standards of business ethics while dealing with our
customers. Adherence to all laws pertaining to product labeling, branding and distribution
is of utmost priority to us and we are fully compliant with each one of them. As of now,
there are no instances of customer dissatisfaction.
Petronet LNG Ltd
Directors Reports
Dear Shareholders
On behalf of the Board of Directors, it is our privilege and honour to present the
Twenty-fifth Annual Report along with Audited Standalone and Consolidated Financial
Statements and Independent Auditors' Report thereon for the financial year (FY) ended 31st
March 2023.
Physical Performance Terminal Operations
Like the financial year 2021-22, this financial year (2022-23) was also an extremely
challenging year for entire oil and gas industry. While the economies were still
recovering from the aftermath of COVID-19, a new factor in the form of geopolitical
disturbances emerged that caused a severe impact on Natural Gas and LNG supplies. Besides
disruptions in the supply chain, unprecedented volatility in the prices of Natural Gas was
also witnessed. The prices, however, reflected some decline along with increased stability
in the fourth quarter.
Dahej LNG Terminal
Despite high volatility in the LNG prices and energy supply related challenges, Dahej
LNG Terminal having a name plate capacity of 17.5 MMTPA, operated at 77.8% capacity,
achieving a throughput of 13.61 MMTPA during the FY 202223, which in terms of energy, is
equivalent to 703.4 TBtus. These numbers are against a throughput of 15.32 MMTPA (87.5%),
equivalent to 792.9 TBtus achieved during the FY 2021-22.
In terms of cargo handling, during the FY 2022-23, the terminal handled 212 LNG Cargoes
as compared to 232 LNG cargoes in the previous financial year.
This year again, Dahej Terminal's truck loading operations demonstrated a significant
increase with 6987 trucks dispatched during FY 2022-23 as compared to 4041 trucks during
the previous year exhibiting a growth of around 73%. The terminal achieved a record of
loading 34 LNG trucks on a single day on 17th March 2023.
Dahej LNG Terminal - A Bird's Eye View In another significant development, the QA/QC
lab of Dahej terminal received the prestigious NABL (ISO 17025) accreditation in August
2022, adding another feather in the decorated cap of the terminal. ISO (17025)
certification by NABL enhances the confidence of the stakeholders in testing/ calibration
reports issued by the lab. Also, the accredited labs receive a form of international
recognition, which allows their data and results to be more readily accepted.
Kochi LNG Terminal
Kochi Terminal having a name plate capacity of 5 MMTPA, operated at 0.93 MMTPA with a
capacity utilisation of 18.6% during FY 2022-23, as compared to 1.04 MMTPA and 20.72% in
FY 2021-22. In terms of energy, the terminal achieved a send out of 48.2 TBtus as compared
to 54.0 TBtus in FY 2021-22.
During FY 2022-23, Kochi Terminal has handled 14 LNG cargoes as compared to 16 LNG
cargoes in FY 2021-22 and supplied 48.25 TBtus of RLNG as compared to 54.03 TBtus in FY
2021-22.
On LNG truck loading front, Kochi terminal also witnessed substantial increase in LNG
supplied by road tankers. The terminal loaded 1494 LNG trucks during FY 2022-23 as
compared to 471 LNG trucks during FY 2021-22 i.e., registering a remarkable increase of
over 217%. To cater this growing demand of LNG by road tankers on southern part of India,
the company has installed and commissioned an additional TLF skid at Kochi. The terminal
loaded highest number of 11 trucks on a single day on January 26, 2023.
Shipping Arrangements
Your Company imports 7.5 MMTPA of LNG on Free on Board (FOB) basis, from Ras Laffan,
Qatar through its three long term chartered LNG vessels namely Disha, Raahi and Aseem. The
duration of the charter is 25 years for each vessel. A consortium of M/s NYK Line, M/s
K-Line, M/s MOL and M/s Shipping Corporation of India Ltd. (SCI), owns these vessels (with
your Company owning a stake of 3% in the vessel Aseem), whereas technical management and
manning of these vessels is carried out by M/s. SCI Ltd.
Supply of LNG from MARC (Exxon Mobil) is on Delivery Ex Ship (DES) basis and fourth
long term-chartered LNG vessel "Prachi", where your company owns a stake of 26%
along with balance stake by consortium of M/s NYK Line, M/s K-Line, M/s MOL and M/s
Shipping Corporation of India Ltd. (SCI), was novated to Exxon Mobil in the year 2017-18.
Considering natural, commercial and energy security needs of the country, the shipping
operation is planned and monitored closely to meet varying supply and demand cycle.
Overall, the shipping operations during FY 2022-23 have run efficiently with utmost
priority to safe operations and optimized fuel consumptions paying utmost regard to the
environmental and economic aspects.
All scheduled cargoes from Ras Laffan, Qatar during FY 2022-23, were lifted, and
transported through the above mentioned long term-chartered LNG vessels along with planned
additional LNG vessels, that were hired from the spot market at competitive rate(s).
Despite two planned dry dockings of vessels Aseem (38 days) and Raahi (45 days), a total
of 112 voyages were made by these long term chartered LNG vessels during the FY 2022-23.
The utilization of LNG jetties has also been optimized throughout the year without any
downtime.
Your Company has proactively started the new environmental compliances of MARPOL, for
its long-term chartered LNG vessels, namely Energy Efficiency Existing Ship Index (EEXI)
and the annual operational Carbon Intensity Indicator (CII) and CII ratings, through its
vessel operators.
During the FY 2022-23, your Company has also achieved two significant milestones of
delivery of 100th LNG Cargo at Kochi LNG terminal on 3rd July 2022 and that of 3000th LNG
Cargo at Dahej LNG terminal on 7th July 2022.
Financial Performance
During the FY 2022-23, your Company achieved highest ever turnover of Rs.59,899.35
Crore as against that of Rs.43,168.57 Crore in FY 2021-22, registering a growth of around
39%. Profit before tax (PBT) stood at Rs 4,334.54 Crore in FY 202223 as against Rs
4,473.82 Crore in FY 2021-22. Profit after tax (PAT) was Rs 3,239.94 Crore during FY
2022-23 as against Rs 3,352.36 Crore in FY 2021-22. The Company was able to achieve robust
financial results owing to efficiency in its operations, despite high and volatile spot
LNG prices during the year. Net worth of your Company has increased from Rs. 13,425.48
Crore as on 31st March 2022 to Rs. 14,934.74 Crore as on 31st March 2023, registering a
growth of over 11%.
A summary of the comparative financial performance in the fiscal year 2022-23 and
2021-22 is presented below:
(Rs. in crore)
Particulars |
For the year ended 31st March, 2023 |
For the year ended 31st March, 2022 |
Revenue from operations |
59,899.35 |
43,168.57 |
Other Income |
573.62 |
307.26 |
Total Revenue (A) |
60,472.97 |
43,475.83 |
Salary & Other operating expenses |
55,043.58 |
37,916.23 |
Finance Charges |
330.51 |
317.33 |
Depreciation |
764.34 |
768.45 |
Total Expenses (B) |
56,138.43 |
39,002.01 |
Profit before tax & Exceptional Items |
4,334.54 |
4,473.82 |
Exceptional Items |
- |
- |
Tax expenses, including deferred tax |
1,094.60 |
1,121.46 |
Profit after tax |
3,239.94 |
3,352.36 |
Earnings (Rs.) per Share |
21.60 |
22.35 |
Dividend
The Board of Directors of your Company has recommended a final dividend of Rs. 3 per
equity share of Rs. 10/- each i.e. 30% of the paid-up Share Capital of the Company as at
31st March 2023. This is in addition to the Special Interim Dividend of Rs. 7 per equity
share of Rs. 10/- each paid by the Company in December 2022. This is the 17th consecutive
year for which your Company has recommended payment of dividend.
The final dividend shall be paid to the members, whose names appear in the Register of
Members as well as the Beneficial Ownership Position provided by NSDL/CDSL as at the close
of business hours on Friday, 18th August 2023 (Record date).
Your Company has duly approved Dividend Distribution Policy in place. The same is
annexed to this Report and is also available on Company's website at
https://www.petronetlng.in/PDF/Dividend_Policy.pdf
Changes In Share Capital
There was no change in the Share Capital of the Company during the year. The Company
has an Authorised Share Capital of Rs. 30,00,00,00,000/- (Rupees Three Thousand Crore)
divided into 3,00,00,00,000 (Three Hundred Crore) Equity Shares of face value of Rs. 10/-
(Rupees Ten) each and Paid-up Share Capital of Rs. 15,00,00,00,880/- (Rupees One Thousand
Five Hundred Crore Eight Hundred Eighty) divided into 15,00,00,00,88 (One Hundred Fifty
Crore Eighty-Eight) Equity Shares of face value of Rs. 10/- (Rupees Ten) each.
Ongoing Projects And New Business Initiatives
In the year 2021-22, your Company had set an ambitious target for itself, thereby
formulating its vision and strategy document titled "1-5-10-40", setting the
path for exponential growth and diversification. The Company aims at achieving an annual
turnover of Rs. 1 lac crore in 5 years and Profit after Tax of Rs. 10 thousand crores with
an investment of Rs. 40 thousand crore. The Company has initiated several expansion and
diversification initiatives in line with its vision which are progressing as per the
envisaged schedule. Some of the major such initiatives and their status is as under:
Ongoing Projects
Storage tanks at Dahej
To enhance the present LNG storage capacity of around 1 million CuM at Dahej terminal,
construction of two additional LNG storage tanks of gross capacity of 1,85,000 CuM each
has been taken up at a cost of approx. Rs. 1250 crore with a construction schedule of 36
months (September, 2024). The execution work of the tanks, which began in September,
2021 is in full swing, wherein a cumulative progress of over 70% has been achieved till
March, 2023 which is ahead of contractual schedule.
Two numbers New LNG Storage Tanks under construction at Dahej
Regas capacity expansion of Dahej
Your Company is also undertaking a highly cost-effective brownfield expansion of
regassification capacity of Dahej Terminal from 17.5 MMTPA to 22.5 MMTPA at an estimated
cost of Rs. 600 crore. The activities related to implementation of the project are
progressing as per the envisaged schedule, with most of the supply related packages,
already been awarded.
Third Jetty project at Dahej
Considering the increase in demand of Natural Gas in the country and proposed expansion
of Dahej LNG terminal from 17.5 MMTPA to 22.5 MMTPA, your Company is implementing a unique
third berth project, also at Dahej through an investment of about Rs. 1700 crore. The
third jetty shall also have facilities to handle Liquified gases, namely ethane and
propane besides LNG. The jetty has been designed to accommodate carriers of size 65,000
CuM to 266,000 (Q-Max) CuM. Activities related to award of major EPCC packages are in the
advance stage.
Affordable Rental Housing Complex (ARHC)
As a reflection of your Company's endeavour to operate as a socially conscious and
responsible organization, it has undertaken construction of 1500 Dwelling units under
Affordable Rental Housing Complex (ARHC) scheme, which strives to empower migrant
workforce by providing them an affordable and dignified housing close to their workplace.
The project is being implemented at an approximate cost of Rs. 100 crore with a schedule
of 24 months. The construction work, which began in February 2023, is in full swing.
Gassing Up and Cooling Down (GUCD) Scheme at Kochi
To tap the niche business opportunity of gassing up and cooling down operations of LNG
ships on sustainable basis, your Company has undertaken augmentation of GUCD facilities at
Kochi terminal at a cost of approximate Rs.10 crore. The construction activities for the
said scheme are in progress. Once completed, the facility would provide a competitive
solution to prospective customers at Kochi LNG terminal.
Installation of additional Truck Loading Bay at Dahej and Kochi
Your Company intends to further fortify its position in growing Indian Natural gas
market. In order to cater to the demand of LNG as fuel for Automotive, Industrial,
Commercial, Institutional and CGD customers not connected through pipelines, your Company
is augmenting its LNG truck loading facility by installing additional four TLF skids at
Dahej and two TLF skids at Kochi, taking the number of TLF skids to eight and four,
respectively. The estimated cost of the scheme is approx. Rs. 70 crore. While, orders for
supply of TLF skids have already been placed, works for installation of the same is
expected to commence shortly.
LNG storage and Regasification project at Gopalpur, Odisha
As a part of geographical diversification strategy, your Company aims to establish its
presence in the Eastern Coast of India through setting up an LNG terminal at Gopalpur,
Odisha with an initial capacity of 4 MMTPA at a cost of approx. Rs. 2300 crore.
Pre-project activities related to various geotechnical investigation and surveys are in
advance stage.
The company has also executed a binding Term Sheet in December 2022 with M/s Gopalpur
Ports Limited to this effect.
Construction of office complex at Dwarka, New Delhi
A unique architectural ship-shaped design has been adopted for the twin tower office
complex under construction at Dwarka, New Delhi at a cost of about rupees 150 crore. The
twin towers will have a glass facade and are being constructed as per the norms complying
with platinum rating of green building council. The construction of the office complex is
in full swing with over 40% progress achieved as on March 31st, 2023.
New Business Initiatives
Petrochemical Complex at Dahej
Your Company is in the process of major diversification for the first time in last 25
years. With your support and trust, your Company has been progressing well on its plan for
setting up of a propane based Petrochemical complex, adjacent to its Dahej LNG terminal.
Detailed Feasibility Report for the project including Propane Dehydrogenation (PDH)
Unit (of capacity 750 KTPA), Poly Propylene (PP) Unit (of capacity 500 KTPA) along with
Ethane and Propane import facility at Dahej is in the advance stage of completion. Your
Company has already undertaken various pre-project activities including Licensor Selection
for both PDH and PP, area development, compliance of ToR for environment clearance etc.
Assurance of Raw water (RW) and Effluent discharge for the project from statutory
authorities has also been obtained.
Integration of LNG terminal in terms of optimum usage of some of the existing utilities
makes this project highly cost effective. The PDH unit of Company is also one of its kind
in the world, where the cold energy of the existing LNG terminal is planned to be
effectively utilized.
To secure the sourcing of feedstock for PDH unit, your Company has also completed the
study for sourcing and shipping of propane at Dahej.
Long Term Sale of the Hydrogen, Ethane, Propane & Propylene
Your Company has also completed the study for sourcing and shipping strategy for Ethane
at Dahej. Your Company is under discussions with prospective off-takers for the long-term
sale of Hydrogen, Ethane, Propane and Propylene. This will make significant contribution
to improve overall financial and operational performance of the integrated Petrochemical
project. Your Company is also poised to be one of the largest third party propylene
suppliers in India.
Overseas Project
A high-level delegation from Ministry of Petroleum and Natural Gas, Government of India
and Top Management of leading Oil & Gas PSUs and Petronet LNG Limited visited Colombo,
Sri Lanka to explore possibility of collaboration in hydrocarbon and energy related
projects including development of LNG supply and infrastructure in Sri Lanka. Your Company
is also evaluating various options to supply the LNG to Sri Lanka for meeting their
upcoming gas based power plant(s) requirement as a stop gap arrangements and possibility
for setting up FSRU based LNG terminal for supply of LNG to meet their long-term gas
requirement.
Promotion of LNG as an Automotive Fuel
As a prudent business entity, a step towards making India a gas based economy and
responsible corporate, augmenting efforts of India meeting COP-27 commitment, your Company
is taking up initiatives to develop the small-scale LNG market in the Country and has been
promoting the environment friendly LNG as a fuel for Medium & Heavy Commercial
Vehicles (M&HCVs), mining equipment etc.
In its efforts to develop LNG as an automotive fuel, your Company has developed four
(04) LNG Dispensing Stations on southern national highways in the first stage and these
stations will be commissioned soon.
Further, your Company has also undertaken an exercise of identifying the locations for
setting up additional 10 LNG stations along major national highways and initiated action
for procurement of equipment for these 10 LNG Dispensing Stations.
MoU with Oil India Limited (OIL)
Your Company has executed a non-binding MoU with M/s Oil India limited (OIL) in January
2023 to explore areas of mutual cooperation in the various fields but not limited to
potential monetisation of onshore stranded gas reserves, Coal Bed Methane (CBM) blocks and
its offtake, Hydrogen generation, Compressed Biogas (CBG) plants etc.
LNG terminal at International Container Transhipment Port (ICTP) at great Nicobar
Island
Your Company is exploring the opportunity to cater to the LNG demand of Andaman and
Nicobar Islands, LNG bunkering demand of Coastal shipping and marine traffic etc. through
establishing a hub and spoke model for LNG supplies and a floating/land based small scale
LNG terminal within proposed ICTP at Galathea bay in the Great Nicobar Island.
Setting up of Compressed Bio-Gas (CBG) Plants
Your Company is in the process of identification of Project Site in Haryana, Uttar
Pradesh, Madhya Pradesh, Gujarat, Maharashtra, Odisha etc. for the setting up of the CBG
Plants. Further dialogue has been initiated with various Government and other bodies for
facilitation w.r.t allocation of land, feedstock arrangement etc. Your Company has
executed a non-binding MoU with M/s Oil India Limited (OIL) to explore areas of mutual
cooperation in the various fields including CBG plants. Preliminary joint due diligence
activity with M/s OIL is undergoing.
Green Hydrogen Initiatives
Your Company is also exploring venture into Green Hydrogen value chain for which,
dialogues have been initiated with various business partners such as consultants,
technology providers, electrolyser manufacturer etc. Your Company is planning to undertake
various business pre-feasibility studies which would pave way for venturing into Green
Hydrogen sector.
Health, Safety & Environment (HSE)
Your Company is committed to conduct business with a strong environment conscience,
ensuring sustainable development, safe workplaces, enrichment of the quality of life of
its employees, customers, and the community at large. As a result, it always initiates
proactive measures to monitor compliance statutes and procedures.
As a part of Integrated Management System, terminals have been re-accredited with ISO
9001:2015, ISO 14001:2015, ISO 45001:2018 and ISO 55001:2014 standards for Quality,
Environment, Occupational Health and Safety and Asset Management Systems.
With high commitment towards safety, Dahej terminal achieved a cumulative 23.17 safe
million man-hours without Lost Time Incident as on 31st March, 2023.The corresponding
number for Kochi terminal is 0.38 million man-hours.
The Company has a well-defined policy on Quality, Health, Safety, Environment, and
Asset Management. Given the inherent hazards in the oil and gas industry, ensuring safe
and environmentally responsible operations becomes even more crucial. The Company has
undertaken various initiatives to inculcate safety culture, incorporate safe practices,
raise awareness about emergencies, and provide safety training to both, its employees and
contract workers working within the terminals, aiming to ensure safety of operations and
the local community. Your Company has conducted 7 numbers of local community training
programs in and around the local villages of Dahej and Kochi terminal on topics related to
LNG hazards, emergency preparedness plan, fire safety awareness, health related topics
etc.
Furthermore, your Company has implemented various measures to prioritize employee
health and well-being as well as to maintain integrity of its physical assets, ensuring
uninterrupted operations of the terminals. Regular firefighting mock drills with incidents
involving varying scenarios are conducted at both the terminals. These drills are a
testimony to the readiness of employees and equipment in dealing with an untoward
situation, if it so arises. A full- fledged marine related emergency mock drill (level-1)
involving LNG carrier (ship) and tugboats was conducted at jetty of Dahej terminal, to
assess terminal's preparedness for marine-related emergencies. To further strengthen its
safety management system, the Company has also become a member of British Safety Council
(BSC) and has begun the process for conducting its Five-star safety audit at both
terminals.
The Company has accorded utmost importance to the Technical & Safety Audits
(internal and external) in both the terminals. Efforts are made by both terminals to
comply the audit recommendations in a time bound manner.
All the External Safety Audits (ESA) points of Oil Industry Safety Directorate (OISD)
audits have been liquidated in a time bound manner. Apart from this, the Company has
initiated "Help each other audit" conducted by cross functional teams of Dahej
and Kochi terminals on annual basis, which facilitates in sharing of the best practices
adopted at any location. The Company also accords highest priority to a safe work culture
at its project sites. It has also initiated Project Safety audits (external and internal)
at the construction site of new LNG tanks at Dahej terminal. The Dahej LNG tanks project
site has achieved accident-free 3.36 million manhours as on 31st March 2023, since the
construction began in September 2021 demonstrating commitment towards safety for all
stakeholders in its work culture.
Details of Subsidiary / Joint Venture / Associate Companies
1) Adani Petronet (Dahej) Port Ltd. (Formally known as Adani Petronet (Dahej) Port
Private Ltd.)
A Solid Cargo Port through a Company named Adani Petronet (Dahej) Port Ltd. (APDPL),
had commenced its operations in August 2010 at the Dahej Port. The Solid Cargo Port
Terminal has facilities to import/export bulk products like coal, steel and fertilizer
etc. Your Company has a 26% equity in this Company and the balance equity is held by the
Adani Ports and SEZ Ltd. APDPL is a joint venture(JV) of your Company.
Financial Performance of the Joint Venture (JV) Company is as follows:
(Rs. in crore)
Particulars |
For the year ended 31st March, 2023 |
For the year ended 31st March, 2022 |
Revenue from operations |
613.81 |
424.49 |
Profit (loss) from continuing operations |
390.20 |
186.77 |
Other comprehensive income |
5.06 |
(2.09) |
Total comprehensive income |
395.27 |
184.68 |
Company's share of total comprehensive income (26%) |
102.77 |
48.02 |
2) India LNG Transport Co. (No. 4) Private Limited ('ILT4')
India LNG Transport Co. (No. 4) Private Limited ('ILT4') is Joint Venture (JV) of your
Company with a shareholding of 26% equity. ILT4 is the owner of vessel MT Prachi and is
primarily engaged in transportation of LNG. It is one of your Company's strategic
investments and has the principal place of business in Singapore.
Financial Performance of ILT-4 is as follows:-
(Rs. in crore)
Particulars |
For the year ended 31st March, 2023 |
For the year ended 31st March, 2022 |
Revenue from operations |
238.43 |
239.22 |
Profit / (loss) from continuing operations |
140.62 |
192.64 |
Other comprehensive income |
- |
- |
Total comprehensive income |
140.62 |
192.64 |
Company's share of total comprehensive income (26%) |
36.56 |
50.09 |
3. Petronet LNG Foundation
Petronet LNG Foundation (PLF), a Company Limited by Guarantee, has been promoted by
your Company under the provisions of Section 8 of the Companies Act, 2013 and the rules
made thereunder as a wholly owned subsidiary of your Company.
Your Company undertakes to contribute to the assets of the company in the event of its
being wound up while it is a member or within one year afterwards, for payment of the
debts or liabilities of the company contracted before it ceases to be a member and of the
costs, charges and expenses of winding up, not exceeding a sum of Rs 1,00,00,000/- (Rupees
One Crore Only). Petronet LNG Foundation is facilitating your Company to comply with its
requirement of Corporate Social Responsibility (CSR) under provisions of Section 135 of
Companies Act, 2013 and rules made thereunder.
4. Petronet Energy Limited
Petronet Energy Limited (PEL), was incorporated as a wholly owned subsidiary of your
Company on 26th February, 2021 with authorized share capital of Rs 500 crore and issued
share capital of Rs 10 crore with an objective to pursue business operations in the areas
of LNG Bunkering, Gassing up and/ or Cool down (GUCD) of LNG ships, supply of heel
quantity to LNG vessels and other allied services.
PEL has set up a unit at Puthuvypeen SEZ (PSEZ) on 27th July, 2022, which has also
obtained all necessary regulatory approvals to start the operations at PSEZ. The strategic
location of Kochi terminal is considered a potential location for refueling of vessels on
the East- West shipping trade route and is also considered as a suitable location for
carrying out GUCD operations.
PEL, as the only entity in India having the expertise to carry out GUCD activities, has
subsequently carried out its maiden operation of GUCD of one LNG vessel at Kochi LNG
Terminal, thus earning net foreign exchange (NFE) as per SEZ requirements.
5. Petronet LNG Singapore Pte. Ltd.
Your Company envisages to be a Global LNG player and has thereby incorporated a wholly
owned subsidiary company "Petronet LNG Singapore Pte. Ltd." (PLSPL) on 7th March
2022. PLSPL has been incorporated to carry out business/activities, including but not
limited to purchase of LNG on long, spot and short-term basis and sale of LNG, trading of
LNG to Indian and foreign companies, optimization and diversion of LNG under its
portfolio, carry out hedging, investments in overseas ventures etc. PLSPL has issued share
capital of Rs 0.41 crores (50,500 shares) to your Company.
Conservation of Energy and Technology
Absorption
Conservation of Energy
All possible measures have been undertaken successfully by your Company to achieve the
desired objective of energy conservation and technology upgradation in order to ensure
optimum conservation of energy and absorption of technology.
Your company has undertaken following other major steps:
Plants are using best technology and optimization practices for energy
conservation, particularly with respect to captive power generation vs. grid power
utilization.
Studies have been undertaken to optimize the fuel consumption of its three long
term-chartered ships. The recommendations of the study are under implementation. Initial
results are highly encouraging.
Plant's cold energy is being used for air conditioning of buildings and cooling
in Nitrogen Generation.
Company is installing rooftop mounted solar panels at Dahej and Kochi terminals
to reduce carbon footprints and contribute to renewable energy drive of the country.
Research & Development
Petronet LNG is committed to promotion of clean energy thus helping the nation to
achieve its Net Zero goals by 2070. Promoting LNG as a transition fuel, is one of such
steps in this direction. Previously, various initiatives such as usage of LNG as fuel in
fishing boats, trial running of buses on LNG in collaboration with KSRTC, etc. have been
successfully undertaken to the optimum extent. Harnessing of cold energy has been
identified as one of the priority areas for the company. Studies are being undertaken to
integrate the cold energy available at Dahej LNG Terminal with upcoming Petrochemicals
complex. Preliminary studies indicate that a significant energy savings can be achieved.
The Company through NIT Surathkal, is working on a project to study the catalytic steam
reforming process for generating hydrogen gas from organic waste. It offers a sustainable
solution for addressing food waste and contributes to a more environmentally responsible
future.
Petronet on Mission LiFE
The Government of India introduced Mission LiFE at UN Climate Change Conference of the
Parties (COP26) in Glasgow, promoting mindful and deliberate utilization of resources. The
company is fully committed to this concept and has already undertaken and planned several
steps to support Mission LiFE as given below:
Conducted a mass plantation drive at both terminals on various occasions
including World Environment Day.
Developed green belt in and around the premises in Dahej & Kochi terminals.
Mangrove plantations covering over 1150 hectares along the coast of Gujarat and
Kerala.
Zero Liquid Effluent discharge at both the Terminals.
Solar production of 360kWp and plans to increase to 560 kWp further in the FY
2023-24.
Development of 4 LNG fuel buses for employee transportation, reducing emissions
by approximately 1820% as compared to diesel buses.
Rainwater harvesting at Kochi LNG Terminal during FY 2022-23 is over 87,000 m3.
Successfully conducted an awareness session on the environment for its employees
and nearby community.
Awards & Recognitions
Throughout the year, your Company has been honored with several prestigious awards and
recognitions, acknowledging Company's dedication to excellence, innovation, commitment to
reduce workplace injuries and implementations of the best Organization's Occupational
Safety & Health (OSH) practices. These accolades are a testament to commitment to
excellence and the hard work of the Company. Some of the notable awards and recognitions
received during the FY 2022-23 include:
Dahej terminal received "3rd Level Award: SURAKSHA PURASKAR (Bronze
Trophy)" from National Safety Council, India in the category Manufacturing sector for
the year-2022 for the first time;
British Safety Council-International Safety Awards 2023 for its Dahej Terminal.
The award signifies first time recognition by an institute of international repute;
LNG Company of the Year Award -2022 from ET Energy World;
CSR India Award 2022 by Greentech Foundation, in the category "Outstanding
achievements in employment enhancing Skills" for undertaking Skill Development and
Training Programme in Plastics Technology with CIPET that has trained more than 800 Youth
with a placement of 86% candidates across several industries till date at multiple
locations;
Felicitation by the Clean Ganga Fund (CGF) and National Mission for Clean Ganga
(NMCG) for the continuous support and valued contribution towards the one of the biggest
environmental movements for conserving the national river, Ganga;
CSR Times Award in Gold Category for its pivotal role in Nation building for the
Project "Installation of PSA Oxygen Generation Plants to combat COVID - 19";
"Best Overall excellence in CSR Award" by ET Ascent for meaningful CSR
Programs and making contributions to the Society at large, in December, 2022
Business Responsibility and Sustainability Report
The Business Responsibility and Sustainability Report covering initiatives undertaken
with respect to environmental, social and governance perspective has been prepared in
accordance with the directives of SEBI and forms a part of the Annual Report.
Foreign Exchange Earnings and Outgo
Your Company's foreign exchange earning was Rs 57.76 crore and foreign exchange outgo
was Rs. 53,248.40 crore during Financial Year 2022-23.
Adequacy of Internal Financial Controls with Reference to the Financial Statements
The Company has a robust system of the Internal Financial Controls (IFC) and its
monitoring. The IFC framework and the Risk Matrix for various business processes are in
place and are reviewed consistently by the management and Audit Committee. Independent
professional agency is engaged for IFC testing. The IFC system ensures compliance of all
applicable laws and regulations, optimum utilisation and safeguard of the Company's assets
and accuracy / completeness of financial records/reports.
Corporate Social Responsibility (CSR)
Your Company recognizes its profound responsibility towards society and continues to
actively contribute to social development causes. With a renewed focus on our social
goals, the Company has adopted a structured approach to improve access to quality
healthcare, enhance educational and skill development facilities, support environmental
initiatives, empower women and uplift communities in need across different regions in the
country.
Your Company has implemented a comprehensive strategy that encompasses short-term,
medium-term and long-term CSR initiatives, ensuring our resources are channelled in an
organized manner to achieve maximum socio-economic impact. In line with the social
objectives, your Company has identified several projects in key areas such as Healthcare
& Sanitation, Education & Skill Development, Promotion of Art & Culture,
Heritage Development, Animal Welfare, Environment & Sustainability, Welfare of the
Divyangjan, Gender Equality and Rural Development. The annual CSR budget is being
allocated progressively and sustainably towards these initiatives.
In terms of provisions of the Companies Act, 2013, an amount of Rs. 76.71 crore was
committed on CSR activities in the FY 2022-23. In FY 2022-23, Company has spent an amount
of Rs. 11.88 crore and provisioned for transfer of an amount of Rs. 50.17 crore to unspent
CSR account (USCRA) for projects under progress making it the highest ever CSR spending of
Rs 62.05 crore since inception, and the remaining unspent and non-committed amount of
Rs.14.66 crore has been earmarked for transferring to Schedule VII fund by 30th September
2023 in accordance with the Companies Act, 2013.
Further, in the FY 2022-23, an amount of Rs. 7.45 crore has been spent from UCSRA of
2021-22 and Rs. 3.44 crore has been spent from UCSRA of 2020-21 for ongoing multiyear
projects. A total amount of Rs. 22.77 crore has been spent in the FY 2022-23 including the
ongoing multiyear projects of the preceding two financial years.
The disclosure as per Rule 9 of Companies (Corporate Social Responsibility Policy)
Rules, 2014 is attached herewith as Annexure I and form part of the Directors' Report.
Your Company has established Petronet LNG Foundation (PLF), a Company Limited by
Guarantee on 31st March 2017. PLF acts as the CSR arm of your Company, operating in
accordance with the provisions of Section 8 of the Companies Act, 2013, and the rules made
thereunder. The foundation has successfully undertaken various impactful projects across
the nation.
While targeting CSR obligations all the projects are carefully selected giving utmost
importance to quality of spending, wider reach and sustainability aspect. Most of the
projects have been outstanding in their overall impact and reach. Some of the impactful
CSR projects taken up by your Company in different sectors in the FY 2022-23 are mentioned
below:
a) Healthcare & Sanitation:
> Running Mobile Medical Vans in Rural & Urban Areas of Gujarat, Kerala, Delhi
and Uttar Pradesh;
> Installation of eye care medical equipment at a Charitable Eye hospital in Delhi;
> Running Women - Centric Healthcare Centre in the aspirational District of Nuh,
Haryana;
> Installation of CT Scan machine at the General Hospital (Ernakulam, Kerala);
> Construction of Sulabh Toilet Complex at Katra (Jammu);
> Various awareness camps on heath, sanitation, organ donation, prevention of TB
etc;
> Provided medical equipment like incinerator, solid waste management facilities to
hospitals;
> Strengthening of facilities for orphan/destitute old age patients, ration support
to shelter homes etc.
b) Education and Skill Development:
> Petronet Kashmir Super 50, Jammu Super 30 and National Super 30 (Delhi) towards
imparting residential coaching & counselling support to 110 underprivileged students
for preparation of JEE examination;
> Skill Development training to 500 youth in Plastics Technology with CIPET (Central
Institute of Petrochemicals Engineering & Technology) at Ahmedabad, Kochi, Dehradun,
Murthal and Baddi;
> Running 200 Ekal Vidyalayas in rural Gujarat and Kerala;
> Construction of School Building for Government Primary School, Lakhigam Village,
Gujarat;
> Skill Training Programme to more than 700 economically weaker rural youth in
tailoring in apparel sector, logistics, customer relationship manager etc. as per National
Skill Development Corporation (NSDC) curriculum, across various locations;
> Many other programmes viz. School Health Check-Up, Installation of smart
classrooms and computer labs, strengthening educational infrastructure in schools, sport
facilities and playground etc. across various locations.
c) Art, Culture and Heritage Development:
> The mega heritage project towards the development of Vipassana Park at Kapilvastu,
Siddarth Nagar, U.P.;
> Construction support to Purvasha Folk and Tribal Art Museum on the bank of Chilika
at Barkul in Khurda district of Odisha;
> Various other projects like skill development workshop for promotion of Art &
Culture in Gujarat, Rajasthan, Jammu and Kashmir.
d) Gender Equality & Women Empowerment:
> Distribution of sewing machines and imparting tailoring training to create
self-employment for more than 2500 underprivileged women across locations in UP and Delhi/
NCR;
> Various women centric awareness camps across the nation.
e) Welfare of the Divyangjan:
> Sanctioned transportation facilities for economically challenged differently abled
students to a special child school in Delhi;
> Arranged assessment and assistive devices distribution camps for blind and hearing
impaired EWS people of Gujarat and Bihar.
f) Research & Development:
> Supported experimental study and lab facility for development & demonstration
of Hydrogen production from food waste generated Biogas at National Institute of
Technology (NIT) Surathkal.
g) Various other short-term projects have also been undertaken in the vicinity of the
existing terminals at Dahej and Kochi, for the benefit of the immediate stakeholders.
The Corporate Social Responsibility Policy of the Company is available at the Company
website on the following weblink:
https://petronetlng.in/PDF/CSR_Policy_27042015.pdf
Directors and Key Managerial Personnel (KMP)
Inductions and Cessation
The following Directors were inducted on the Board/ceased
to be Directors on the Board of the Company:
1. Shri Arun Kumar ceased to be Independent Director on the Board of the Company w.e.f.
09.04.2022 consequent upon completion of three years' tenure on 08.04.2022.
2. Shri Manoj Jain, Chairman & Managing Director, GAIL (India) Limited (GAIL) and
Nominee Director-GAIL on the Board of the Company, ceased to be Director on the Board of
the Company w.e.f. 01.09.2022 consequent upon his retirement from the services of GAIL
upon attaining the age of superannuation.
3. Dr. Alka Mittal, Chairman & Managing Director, Oil and Natural Gas Corporation
Limited (ONGC) and Nominee Director - ONGC on the Board of the Company, ceased to be
Director on the Board of the Company w.e.f. 01.09.2022 consequent upon her retirement from
the services of ONGC upon attaining the age of superannuation.
4. Shri Mahesh Vishwanathan Iyer, CMD (additional charge) and Director (BD), GAIL was
appointed as Nominee Director (GAIL) w.e.f. 01.09.2022 until conclusion of 24th Annual
General Meeting held on 21.09.2022. He was re-appointed as Additional Director (Nominee
Director- GAIL) w.e.f. 22.09.2022. He ceased to be Director on the Board of the Company
w.e.f. 21.10.2022 consequent upon withdrawal of his nomination by GAIL.
5. Shri Rajesh Kumar Srivastava, CMD (additional charge) & Director (Exploration),
ONGC was appointed as Nominee Director, ONGC w.e.f. 07.09.2022 until conclusion of 24th
Annual General Meeting held on 21.09.2022. He was re-appointed as Additional Director
(Nominee Director - ONGC) w.e.f. 22.09.2022 and his appointment was regularized by the
Members of the Company by way of postal ballot on 03.12.2022. He ceased to be Director on
the Board of the Company w.e.f. 14.12.2022 consequent upon withdrawal of his nomination by
ONGC.
6. Shri Sandeep Kumar Gupta, Chairman & Managing Director, GAIL was appointed as
Nominee Director - GAIL on the Board of the Company w.e.f. 21.10.2022. His appointment was
regularized by the Members of the Company by way of postal ballot on 03.12.2022.
7. Shri Arun Kumar Singh, Chairman & Managing Director, Bharat Petroleum
Corporation Limited (BPCL) ceased to be Nominee Director - BPCL w.e.f. 01.11.2022
consequent upon his retirement from the services of BPCL upon attaining the age of
superannuation.
8. Shri V R K Gupta, Director (Finance) (with additional charge of Chairman &
Managing Director and Director (HR)), BPCL was appointed as Nominee Director-BPCL w.e.f.
01.11.2022. His appointment was regularized by the Members of the Company by way of postal
ballot on 28.01.2023. He ceased to be Director on the Board of the Company w.e.f.
21.03.2023 consequent upon withdrawal of his nomination by BPCL.
9. Shri Muker Jeet Sharma, Indian Forest Officer (Retd.) was appointed as Independent
Director on the Board of the Company w.e.f. 24.11.2022. His appointment was regularized by
the Members of the Company by way of postal ballot on 28.01.2023.
10. Shri Arun Kumar Singh, Chairman, ONGC was appointed as Nominee Director-ONGC w.e.f.
14.12.2022. His appointment was regularized by the Members of the Company by way of postal
ballot on 28.01.2023.
11. Shri G. Krishnakumar, Chairman & Managing Director, BPCL was appointed as
Nominee Director, BPCL w.e.f. 21.03.2023. His appointment was regularized by the Members
of the Company by way of postal ballot on 10.06.2023.
12. Shri Sanjeev Kumar, Managing Director, Gujarat State Petroleum Corporation Limited
(GSPCL) ceased to be Nominee Director -GMB/ GoG on the Board of the Company w.e.f.
01.04.2023 consequent upon withdrawal of his nomination by GSPCL.
13. Shri Milind Torawane, Managing Director, GSPCL was appointed as Nominee Director -
GMB/ GoG w.e.f. 10.04.2023. His appointment was regularized by the Members of the Company
by way of postal ballot on 10.06.2023.
14. The tenure of Shri Vinod Kumar Mishra, Director (Finance) of the Company was
extended for a further period of two years w.e.f. 18.04.2023 on the existing terms and
conditions by approval of the Members of the Company by way of postal ballot on
08.04.2023.
The Board placed on record its sincere appreciation for valuable services rendered and
contribution made by Shri Arun Kumar - Independent Director, Shri Manoj Jain - Nominiee
Director (GAIL), Dr. Alka Mittal - Nominiee Director (ONGC), Shri Mahesh Vishwanathan Iyer
- Nominiee Director (GAIL), Shri Arun Kumar Singh - Nominiee Director (BPCL), Shri Rajesh
Kumar Srivastava - Nominiee Director (ONGC), Shri V R K Gupta - Nominiee Director (BPCL)
and Shri Sanjeev Kumar - Nominiee Director (GMB/GoG), Members of the Board during their
association with the Company.
Reappointment
In accordance with the Articles of Association of the Company and as per statutory
requirements, Shri Pankaj Jain, Chairman and Shri Shrikant Madhav Vaidya, Nominee Director
- IOCL, would retire by rotation at the ensuing Annual General Meeting and being eligible,
offers themselves for reappointment.
Brief resume of directors seeking reappointment together with the nature of their
expertise in specific functional areas, disclosure of relationship between director
inter-se, name of companies in which they hold membership/ chairmanship of committees of
the Board alongwith their shareholding in your Company etc. as stipulated under SEBI
(LODR) Regulations, 2015 and other statutory provisions are given in the annexure
to the Notice of 25th Annual General Meeting.
Key Managerial Personnel
Pursuant to Section 203 of Companies Act, 2013, the Key Managerial Personnel of the
Company as on 31st March 2023 were:
1. Shri Akshay Kumar Singh, MD & CEO
2. Shri Vinod Kumar Mishra, Director (Finance) and CFO
3. Shri Pramod Narang, Director (Technical)
4. Shri Rajan Kapur, Company Secretary
Annual Performance Evaluation of the Board
The Board adopted a formal mechanism for evaluating its performance and as well as that
of its committees and individual Directors, including Chairman of the Board. The
evaluation of all the Directors, Committees, Chairman of the Board and the Board as a
whole was conducted based on a structured evaluation process considering various aspects
of the Board's functioning such as composition of Board and Committees, experience and
competencies, performance of specific duties and obligations, contribution at the meetings
and otherwise, independent judgment, governance issues etc.
Compliances with respect to Independent Directors
Pursuant to Section 149(7) of Companies Act, 2013 and Regulation 25 of SEBI (Listing
the Obligations and Disclosure Requirements) Regulations, 2015, declaration(s) by all the
Independent Director(s) have been obtained stating that they meet the criteria of
independence as provided in Section 149(6) of the Companies Act, 2013 and Regulation 16(1)
(b) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.
The Independent Directors appointed by the Board are renowned experts in their fields
which are required for the Directors in the context of the Company's business for
effective functioning such as Leadership, Technology & Operational experience,
Strategic Planning, Financial, Regulatory, Legal and Risk Management, Industry experience,
Research & Development and Global Business. Further, all the Independent Directors are
complying with the provisions of Section 150 of the Companies Act, 2013 read with the
Companies (Appointment and Qualifications of Directors) Rules, 2014.
Familiarization Programme and Training of Independent Directors
All new Independent Directors inducted to the Board attend an orientation program. The
Company has well-defined training program for training to Board Members which inter- alia
include the various familiarization programs in respect of their roles, rights,
responsibilities in the Company, nature of the industry in which Company operates,
business model of the Company etc. Further, the same is also taken care during the various
strategy meets of the Company and different presentations in the Board/ Committee
meetings. The details of such familiarization programs have also been posted on the
website of the Company at https://www.petronetlng. in/Familiarisation_Programme.php.
Further, at the time of the appointment of Independent Director, the Company issues a
formal letter of appointment outlining his/her roles, responsibilities, functions, duties,
remuneration and other terms and conditions. The format of the letter of appointment is
available on the website of the Company.
Extra Ordinary General Meeting
During the year, no Extra Ordinary General Meeting was held.
Number of Meetings of the Board of Directors
During the year, nine Board Meetings were held and the details of which are given in
the Corporate Governance Report annexed to this Report which forms part of the Annual
Report. The intervening gap between the meetings was within the period prescribed under
the Companies Act, 2013 and also as per SEBI (Listing Obligations and Disclosure
Requirements) Regulations, 2015. For further details regarding number of meetings of the
Board and its committees, please refer Corporate Governance Report, annexed to this
Report.
Board Diversity
The Company recognizes and embraces the importance of a diverse board in its success.
We believe that a truly diverse board will leverage differences in thought, perspective,
knowledge, skill, regional and industry experience, cultural and geographic backgrounds,
age, ethnicity, race and gender that will help us retain our competitive advantage. The
Board Diversity Policy adopted by the Board sets out approach to diversity. The policy is
available at the website of the Company at
https://www.petronetlng.in/PDF/PolicyDiversity.pdf
Audit Committee
The recommendations made by the Audit Committee during the year were accepted by the
Board. The other details of Audit Committee like composition, terms of reference, meetings
held are provided in the Corporate Governance Report annexed to this Report.
Nomination and Remuneration Committee
The Company has a Nomination and Remuneration Committee and detailed disclosure in this
regard has been given in the Corporate Governance Report which is annexed to this Report.
Separate Meeting of Independent Directors
As per statutory requirements, the Company arranges for separate meetings of
Independent Directors every year and detailed disclosure in this regard has been given in
the Corporate Governance Report which is annexed to this Report.
Particulars of Loans, Guarantees or Investments Under Section 186 of the Companies Act,
2013
In compliance with the provisions of the Companies Act, 2013, the details of
investments made, and loans/guarantees provided as on 31st March 2023 are given in the
respective Notes to the financial statements.
Insurance
The Company has taken Directors' and Officers' liabilities insurance as well as
appropriate insurance for all assets against foreseeable perils.
Significant and Material Orders Passed by Regulators or Courts
There are no significant and material orders passed by the Regulators, courts or
Tribunals which would impact the going concern status and the Company's future operations.
Particulars of Contracts or Arrangements with Related Parties (RPTs)
In line with the provisions of the Companies Act, 2013 and the SEBI (LODR) Regulations,
2015, the Company has a comprehensive Policy on materiality of Related Party Transactions
and on dealing with Related Party Transactions. The existing Policy was reviewed and
approved by the Board in line with amendments in the Companies Act, 2013 and SEBI (LODR)
Regulations, 2015 and made effective from 23.03.2023. The Policy is available on the
website of the Company.
The Company gives the disclosure regarding material transactions with related parties
on quarterly basis along with the compliance report on Corporate Governance. As per
requirements of Section 134 (3) of Companies Act, 2013 read with Rule 8 of Companies
(Accounts) Rule, 2014, particulars of contracts or arrangements with related parties as
referred in Section 188 (1) of the Companies Act, 2013 is annexed to this report. Further,
suitable disclosure as required by the Accounting Standards has been given in the Notes to
the Financial Statements.
Particulars of Employees Pursuant to Section 197 of the Companies Act, 2013
Pursuant to provisions of Section 197 of the Companies Act, 2013, read with the Rule 5
of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the names
and other particulars of employees are attached to this Report.
Disclosures Pursuant to Section 197(12) of the Companies Act, 2013
The ratio of remuneration of each Director to the median employees remuneration and
such other details in terms of Section 197 (12) of the Companies Act, 2013 read with Rule
5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014
forms part of Directors' Report and is annexed herewith.
Human Resources
Your Company takes pride in its highly motivated and competent Human Resource that has
contributed its best to bring the Company to its present heights. Employees are the
driving force behind the sustained stellar performance of your Company over all these
years of Company's ascendancy. As a commitment towards your Company's core values,
employees' participation in Management was made effective based on mutual respect, trust
and a feeling of being a progressive partner in growth and success. Both employees and
management complemented each others efforts in furthering the interest of your Company as
well as its stakeholders, signifying and highlighting overall harmony and cordial employee
relations prevalent in your Company. No man days were lost due to strike or lock-out. As
on 31st March, 2023 there were 523 employees including 3 Wholetime Directors (as on 31st
March, 2022, 519 employees including 3 whole-time Directors).
The Company also made strides towards development of employees through systematic
training interventions for which the company partnered with IIM- Lucknow, IIM- Udaipur,
IIM-Indore and IIM-Shillong to develop and impart custom made behavioral training modules.
Apart from this, the Company continued nominating its employees to specialized functional
skill enhancement trainings from across all the locations to different parts of India.
During the year, the Company also nominated its employees to various international
Conferences and Seminars like ADIPEC, GASTECH, World Petrochemical Conference, CERAWeek,
World LNG Summit etc. to prepare them to adapt with changes in global LNG landscape.
Silver Jubilee
Petronet family achieved a significant milestone when the company celebrated its 25th
Foundation Day on 2nd April 2022 and to commemorate this occasion, PLL released a
customized 'Mystamp' to preserve this memory forever.
All the units of PLL celebrated this occasion with fanfare where employees' family
members also participated with lot of vigour and spirit.
Secretarial Audit
M/s A. N. Kukreja, Practicing Company Secretary (M. No. FCS 1070, CP No. 2318), was
appointed by the Board of Director to conduct the Secretarial Audit of the Company for the
financial year 2022-23 as required under Section 204 of Companies Act, 2013 and rules
thereunder.
A Secretarial Audit Report for the Financial Year 2022-23 submitted by M/s A. N.
Kukreja, Secretarial Auditor, is annexed with this report along with Management's Reply on
the Secretarial Audit Report for the FY 2022-23.
The Company is committed to good Corporate Governance and lays strong emphasis on
transparency, accountability and integrity. As required under SEBI (Listing Obligations
and Disclosure Requirements) Regulations, 2015, the Report on Corporate Governance,
together with Auditors' Certificate regarding compliance of conditions of corporate
governance for the FY 2022-23, is annexed to this report along with Management's Reply on
the Auditors' Report on the Corporate Governance Report for the FY 2022-23.
Management Discussion and Analysis
The Annual Report contains a separate section on Management Discussion and Analysis
which is annexed with the Directors' Report.
Compliance with Secretarial Standards
The Company has devised proper systems to ensure compliance with the provisions of all
applicable Secretarial Standards issued by the Institute of Company Secretaries of India
and that such systems are adequate and operating effectively.
Industrial Relations
Your Company has a firm belief that Human Rights should be basic constituents of human
behaviour which essentially drives various policies and practices in a company. We,
therefore, do not discriminate between our employees and other manpower engaged in our
work centres when it comes to facilities related to health, safety, and other amenities.
We ensure that all the statutory guidelines are followed in their true spirit even for the
manpower engaged by various service providers. Consequently, our IR environment is always
congenial and since inception, there are zero instances of disharmony at any of our work
locations.
Risk Management
Your Company has implemented a comprehensive Risk Management system that adheres to
international standards, providing a framework to proactively identify, analyse, manage
and report risks across its entire value chain. The system includes ongoing risk
assessments, prioritization, mitigation, monitoring and reporting.
Your Company's approach is to ensure that risk management is applicable
organization-wide and that risks are measured against their potential impact and
likelihood. Your Company understands that risks are multi-dimensional and depend on both
internal and external factors. Therefore, your Company addresses them in a holistic
manner.
The Risk Management Policy provides clear guidance for identifying and quantifying
risks, exploring mitigation measures, and managing risks without affecting your Company's
business objectives. Risks are periodically identified, quantified, prioritized and
reported to the Management. Mitigation plans are reviewed and monitored quarterly and
reported to the Risk Management Committee of the Board. The Committee oversees the
implementation of the Risk Management Policy and procedures throughout the Company.
Risks are periodically reviewed and monitored by the Risk Management Committee of the
Board and Audit Committee, before presenting them to the Board. Your Company assesses
business risks, and their mitigation plans quarterly, to ensure effective risk management
in the changing business environment and as it expands into new areas of business.
The Risk Management policy of your Company is regularly reviewed and amended/updated
every two years based on SEBI(LODR) Regulations as amended from time to time.
By prioritizing risk management across your Company, it can proactively mitigate risks,
ensuring the safety and success of its operations.
Details of Establishment of Vigil Mechanism
The Board of Directors of the Company has approved the Vigil Mechanism in terms of
provisions of Section 177 of Companies Act, 2013 and SEBI (Listing Obligations and
Disclosure Requirements) Regulations, 2015 to report, to the management, concerns about
unethical behaviour, actual or suspected fraud or violation of the policy. The same has
also been hosted on the website of the Company. During the year ended 31st March 2023, no
complaint was received under Vigil Mechanism and thus no complaint was pending as on 31st
March, 2023.
Code of Conduct
The Company has formulated a Code of Conduct for Board Members and Senior Management
Personnel. The confirmation of compliance of the same is obtained from all concerned on
annual basis. All Board Members and Senior
Management Personnel have given their confirmation of compliance for the year under
review. A declaration duly signed by MD & CEO is given in the Report on Corporate
Governance annexed to this Report. The Code of Conduct for Board Members and Senior
Management Personnel is available on the website of the Company.
Listing on Stock Exchanges
The Company's equity shares are listed on the BSE Limited and National Stock Exchange
of India Ltd.
Transfer of Amounts/Securities to Investor Education and Protection Fund
Pursuant to the provisions of Section 124 and 125 of the Companies Act, 2013 and Rules
made thereunder, the Company has deposited the amount lying in Unpaid/ Unclaimed Dividend
account for the financial years 2006-07 to 2014-15 to Investor Education and Protection
Fund. Detail of the same is available at website of the Company at the following link
https://www.petronetlng.in/cg.php.
Further, pursuant to the provisions of Section 124(6) of Companies Act 2013, all the
shares in respect of which dividend has not been paid or claimed for seven consecutive
years or more were also transferred to IEPF Suspense Account. Details of the same is
available at website of the Company at the following link-
https://www.petronetlng.in/cg.php.
Annexures Forming Part of Annual Report
The particulars of annexure forming part of this report areas under:
Particulars |
Annexure |
Annual Report on CSR Activities |
I |
Disclosure of Related Party Transactions in Form AOC-2 |
II |
Particulars of Employees pursuant to 197 of the Companies Act, 2013 read
with rules. |
III |
Secretarial Audit Report in Form MR-3 |
IV |
Management Discussion & Analysis |
V |
Report on Corporate Governance |
VI |
Business Responsibility and Sustainability Report for the year 2022-23 |
VII |
Other Disclosures
No disclosure or reporting is required in respect of the following items as either
these were not applicable or there were no transactions on these items during the
financial year 2022-23:
1. Details relating to deposits covered under Chapter V of the Act.
2. Issue of equity shares with differential rights as to dividend, voting or otherwise.
3. Issue of shares (including sweat equity shares) to employees of the Company under
any scheme.
4. Neither the Managing Director nor the Whole-time Directors of the Company receive
any remuneration or commission from any of its subsidiaries.
During the financial year 2022-23, no cases were filed pursuant to the Sexual
Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and
thus no case was pending as on 31st March, 2023. As a part of compliance to the above said
act, Internal Complaints Committees (ICC) have been constituted to redress the complaints
regarding sexual harassment.
There are no material changes and commitments affecting the financial position of the
Company which have occurred between the end of the financial year and the date of this
report.
Statutory Auditors
M/s V. Sankar Aiyar & Co., Chartered Accountants, have been appointed by the
Shareholders of the Company in the Annual General Meeting held on 21.09.2022 as Statutory
Auditors for a tenure of 5 years, up to the Annual General Meeting to be held in 2027.
Auditors' Report
The Auditors have submitted an unqualified report for the financial year 2022-23. No
fraud has been reported by Auditors under sub-section (12) of Section 143 of the Companies
Act, 2013.
Cost Auditor
As prescribed under the Companies (Cost Records and Audit) Rules, 2014, the Cost
Accounting records are being maintained by your Company.
The Board of Directors has appointed M/s Ramanath Iyer & Co., Cost Accountants
(Registration. No. 000019) as the Cost Auditors of the Company for a period of 3 years,
starting from Financial Year 2022-23 up to 2024-25.
Directors' Responsibility Statement
Pursuant to the provisions of clause (c) of sub-section (3) of Section 134 of the
Companies Act, 2013, Directors hereby states 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 and of
the profit and loss of the Company for that period;
(c) The directors have taken proper and sufficient care for the maintenance of adequate
accounting records in accordance with the provisions of this Act for safeguarding the
assets of the Company and for preventing and detecting fraud and other irregularities;
(d) The directors have prepared the annual accounts on a going concern basis;
(e) The directors have laid down internal financial controls to be followed by the
Company and that such internal financial controls are adequate and are operating
effectively; and
(f) The directors have devised proper systems to ensure compliance with the provisions
of all applicable laws and that such systems are adequate and operating effectively.
Green Initiatives
In light of various circulars issued by Ministry of Corporate Affairs and the
Securities and Exchange Board of India, the annual general meeting is being held through
video conferencing. The Annual Report for the financial year 2022-23 is being sent through
email and the same is also available at the website of the Company. MCA circular dated
05.05.2020 requires that the Company should facilitate the manner in which the persons who
have not registered their email addresses with the company can get the same registered
with the company. In light of the MCA Circulars and better Corporate Governance, the
Company has provided facility to the shareholders through the depositories i.e. NSDL and
CDSL and through its Registrar and Transfer Agent i.e. Bigshare Services Private Limited,
to register their email addresses with the depositories or the Company for receiving the
Annual Report for 2022-23 and other communications.
Accordingly, it is requested that Members who have not registered their email
addresses, may kindly register the same.
Acknowledgements
The Board of Directors sincerely thanks and wishes to place on record its appreciation
of the Ministry of Petroleum and Natural Gas, Government of India, State Governments of
Gujarat and Kerala, Promoters of the Company, RasGas, Exxon Mobil and other LNG suppliers,
gas off-takers and consumers of re- gasified LNG, Auditors and Lenders for their
whole-hearted co-operation and unstinted support.
The Directors of your Company also convey their gratitude to all the shareholders for
the continued support and the trust they have reposed in the Management. The Directors
look forward to a better future and further growth of your Company.
The Board also appreciates the contribution of contractors, vendors and consultants in
the implementation of various projects of the Company.
We wish to place on record our deep appreciation to employees at all levels for their
hard work, dedication and commitment.
For and on behalf of the Board of Directors |
|
|
(Pankaj Jain) |
|
Chairman |
Place: New Delhi |
|
Dated: 29.08.2023 |
|