• OPEN AN ACCOUNT
Indian Indices
Nifty
15,847.60 -392.70
(-2.42%)
Sensex
52,921.09 -1,287.44
( -2.37%)
Bank Nifty
33,339.45 -824.25
( -2.41%)
Nifty IT
28,496.00 -1,581.70
( -5.26%)
Global Indices
Nasdaq
11,418.15 -566.37
(-4.73%)
Dow Jones
31,490.07 -1,164.52
(-3.57%)
Hang Seng
20,644.28 41.76
(0.20%)
Nikkei 225
26,402.84 -508.36
(-1.89%)
Forex
USD-INR
77.45 0.07
(0.09%)
EUR-INR
81.38 0.12
(0.14%)
GBP-INR
96.11 -0.09
(-0.10%)
JPY-INR
0.60 0.00
(0.53%)

EQUITY - MARKET SCREENER

Petronet LNG Ltd
Industry :  Miscellaneous
BSE Code
ISIN Demat
Book Value()
532522
INE347G01014
89.5031287
NSE Symbol
P/E(TTM)
Mar.Cap( Cr.)
PETRONET
10.01
33570
EPS(TTM)
Face Value()
Div & Yield %
22.35
10
2.01
 

As on: May 19, 2022 02:14 PM

Dear Shareholders,

On behalf of the Board of Directors, it is our privilege and honour to present the Twenty-Second Annual Report along with Audited Standalone and Consolidated Financial Statements and Auditors' Report thereon for the financial year ended 31st March, 2020.

COVID-19

During the year 2019-20, the world at large suffered with Novel Coronavirus (COVID-19). The Novel Coronavirus (COVID-19) has infected more than a million people in more than 150 countries – a scourge confronting all of humanity, impacting lifestyles, businesses, economies and the assumption of common well-being that all of us have largely taken for granted. Despite adverse circumstances, the Company continued to deliver its best in its operations and also effectively contributed towards the society at large by undertaking various activities under corporate social responsibility.

PHYSICAL PERFORMANCE

The financial year 2019-20 saw the Company operating its Dahej Terminal at 17.25 million tonnes throughput as compared to 15.97 Million tonnes in the previous year 2018-19. The demand for LNG was consistent throughout the year. During the financial year 2019-20, the Dahej Terminal handled 263 LNG Cargoes and supplied 885.06 Trillion BTU (TBtu) of RLNG as compared to 241 cargoes during financial year 2018-19 wherein supplies were 820.15 TBtu. During the financial year 2019-20, 2598 LNG Road Tankers were also loaded and dispatched from Dahej Terminal and 290 Trucks from Kochi Terminal. The utilization of Kochi Terminal remained low in the absence of pipeline network for gas evacuation. 12 Cargoes were handled at the Kochi Terminal during the financial year 2019-20 as compared to 9 Cargoes (including loading) during the year 2018-19. During the year 2019-20, Kochi terminal supplied 42.78 TBtus of RLNG as compared to 24.07 TBtus financial year 2018-19.

SHIPPING ARRANGEMENTS

Three LNG ships, namely ‘Disha,' ‘Raahi' and ‘Aseem' carry the entire LNG volumes from RasGas under a long-term contract to Dahej. Besides Japanese companies, Shipping Corporation of India (SCI) is also an equity partner in the ship-owning companies. All these ships are manned, managed, maintained and operated by SCI. The ships operate on a long-term time charter basis with Petronet as the charterer. The fourth LNG vessel ‘Prachi' was delivered on 30th November 2016. The duration of the charter is 19 years. Besides Japanese Companies NYK, MOL and K-Line, Shipping Corporation of India (SCI) is an equity partner in the ship-owning company. PLL has taken 26% equity in this LNG ship. As is the case with the above mentioned first three ships, the fourth ship is also being manned, managed, maintained and operated by SCI. Supply of LNG from Gorgon is now on delivered basis and "Prachi" has been novated to Exxon Mobil.

PLL imports 7.5 MMTPA of LNG from Ras Laffan, Qatar on FOB basis through its long term chartered LNG vessels Disha,

Raahi and Aseem. The duration of the charter is 25 years for each vessel. These vessels are owned by a consortium of M/s NYK Line, M/s K-Line, M/s MOL and M/s SCI Ltd. The technical management, manning and operations are carried out by M/s SCI Ltd. Supply of LNG from Gorgon, Australia is now on DES basis and under this agreement our fourth long term chartered LNG vessel "Prachi" has been novated to Exxon Mobil. Prachi is owned by a consortium of M/s NYK Line, M/s K-Line, M/s MOL and M/s SCI Ltd including PLL with 26% equity. The technical management, manning and operations of Prachi is also carried out by M/s SCI Ltd. During FY 2019-20, the overall shipping operations have run smoothly and the jetty utilization has been optimized without any downtime. LNG vessel Aseem had a contact damage in the month of March 2019 and was not in service for a period of about two & half months. LNG vessel Disha was not in service for a period of about two months due to a breakdown. Cargoes of these vessels were transported by hiring substitute LNG vessels from market without incurring any downtime or commercial loss to PLL.

DAHEJ LNG TERMINAL

Dahej Terminal which now has name plate capacity 17.5 MMTPA operated at about 17.25 MMTPA capacity utilization during the FY 2019-20. Your Company has added Regasification Capacity of 2.5 MMTPA at Dahej Terminal in the month of June 2019 and total Regasification Capacity of Dahej Terminal has now been enhanced to 17.5 MMTPA. Accordingly, Dahej Terminal is now catering higher gas demand and its share of gas supplies has consequently increased in the energy mix of India. The additional Regasification unit for enhancing the Regasification Capacity has been added at an approximate cost of Rs. 415 crore without raising any external debt. Your Company is also planning seventh and eighth LNG Tanks. Also, feasibility study for a standby third jetty has started, which will enhance reliability of LNG ship receiving.

KOCHI LNG TERMINAL

During the year, the Kochi Terminal of name plate capacity 5 MMTPA operated at average capacity utilization of about 17%. BPCL-Kochi Refinery and FACT plant were the only major consumers throughout the FY 2019-20. Off-take of RLNG from Kochi Terminal is expected to increase in FY 2020-21 in view of RLNG evacuation pipeline connectivity to Mangalore likely to get completed. RLNG evacuation pipeline to Mangalore is almost completed and expected to commission soon. ‘Taral' LNG supplies continued with trucks to various consumers not connected on pipeline. LNG Dispensing facility was also commissioned and LNG filling in bus started for trial running.

FINANCIAL PERFORMANCE

During the financial year 2019-20, your Company achieved a turnover of Rs. 35,452 Crore as against Rs. 38,395 Crore in 2018-19. The net profit during the year stood at Rs. 2,698 Crore as against Rs. 2,155 Crore in the previous year. A summary of the comparative financial performance in the fiscal 2019-20 and 2018-19 is presented below:

(Rs. in crore)
Particulars 2019-20 2018-19
Revenue from operations 35,452 38,395
Other Income 373 450
Total Revenue (A) 35,825 38,845
Salary & Other operating expenses 31,463 35,102
Finance Charges 403 99
Depreciation 776 411
Total Expenses (B) 32,642 35,612
Profit before exceptional item and tax 3,183 3,233
Exceptional Items 72 -
Profit before tax 3,111 3,233
Tax expenses, including deferred tax 413 1,078
Profit after tax 2,698 2,155
Earnings (Rs.) per Share* 17.98 14.37

DIVIDEND

The Board of Directors of your Company has recommended a final dividend of Rs. 7 per equity share of Rs. 10/- each i.e. 70% of the paid-up Share Capital of the Company as on 31st March, 2020. This is in addition to Special Interim Dividend of Rs. 5.50 per equity share of Rs. 10/- each paid by the Company in November, 2019. This is the 14th 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 16th July, 2020 (Record date).

The Board of your Company has formulated a Dividend Distribution Policy ("The Policy"). The Policy is annexed to this Report and is also available on our website www.petronetlng.com.

CHANGES IN SHARE CAPITAL

There was no change in the Share Capital of the Company during the year. The Company has Authorised Share Capital of the Company 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.

FINANCING OF PROJECTS

Given the strong cash flows of the Company, the expansion of the Dahej project and other capital expenditure was funded entirely with the internal accruals without the need to draw any debt. The relationship with the existing lenders continues to be good.

NEW BUSINESS INITIATIVES

LNG TERMINAL AT BANGLADESH PROJECT

Your company has submitted an Expression of Interest to the REOI (request for expression of interest) floated by Rupantarita Prakritik Gas Company Limited (RPGCL), a subsidiary of Petrobangla for construction of Land-based LNG Re-gasification Terminal at Matarbari, Cox's Bazar, Bangladesh on build, own, operate and transfer basis. RPGCL is currently in the process of shortlisting the Expression of Interest (s) received from international companies.

LNG TERMINAL & RLNG SUPPLY IN SOUTH ANDAMAN

Your company has completed pre-project studies for a floating storage & regasification (FSRU) terminal in South Andaman. Based on the studies a Detailed Feasibility Report (DFR) was prepared & submitted to Andaman & Nicobar Administration. As Ministry of Power has awarded the 50MW RLNG based power plant to NTPC on nomination, your company is planning to bid for their Gas supply tender (issued in Sept' 2019), bid submission is expected in the next financial year.

LNG TERMINAL IN SRI LANKA

Your Company has completed the Pre-Feed studies along with Japanese Consortium and Sri Lanka Gas Terminal Company Limited for setting up a Floating Storage & Regasification Terminal at Colombo, Sri Lanka. The Company is now conducting the FEED studies. The Environmental Clearance for the project is also progressing and public comments are responded. Discussion on definitive agreement such as terminal use agreement, LNG sale and purchase agreement, implementation agreement, etc. regarding the project have started.

LNG AS AN AUTOMOTIVE FUEL

As a responsible corporate citizen and in a step towards meeting India's COP-21 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 in Road transportation. Your Company had done discussions and deliberation with Ministry of Road Transportation and Highways (MORTH) and Ministry of Commerce and Industries (MOCI) for inclusion of LNG as an automotive fuel in Central Motor Vehicle Rules (CMVR) and for inclusion of LNG dispensing stations development regulation in Static and Mobile Pressure vessel rules (SMPV). With the efforts of your Company both these regulations are in place now and a new doorway is opened in Indian market for LNG as a cleaner transportation fuel.

Your Company has commissioned India's first LNG dispenser stations inside Dahej and Kochi LNG terminals and has also commissioned the first commercially approved and registered LNG powered buses of the Country for employee's movement at both places. Your Company has prepared a business plan based on traffic study on Indian Roads and decided to develop LNG corridors covering major National Highways of India. Your Company is developing western and southern highways expeditiously as a pilot project. Your Company has partnered up with various CGD players and OMCs to jointly develop these LNG/LCNG dispensing stations in their area. The recent clarification by PNGRB on setting up of LNG dispensing stations in various CGD Geographical Areas will pave the way for creation of LNG corridors across the country.

HEALTH, SAFETY & ENVIRONMENT (HSE)

Both Dahej and Kochi terminals continue to operate safely without any major incident. Your Company is committed to conduct business with a strong environment conscience, ensuring sustainable development, safe workplaces and enrichment of the quality of life of its employees, customers and the community at large. Compliance with safety systems and procedures and environmental laws is monitored by the Company. The Company is having well defined policy for Health, Safety & Environment. Your Company is committed to fight against novel COVID-19. Your Company has taken numerous steps both at Company and community levels including sanitization works, quarantine cycles for employees/ contract workers. Employee at Corporate Office are allowed to work from home in lock-down. Your team is taking various initiatives to interact with the employees in both plants and employees under quarantine at hotel/home. Your Company is extending every support to its employees and their families in this difficult time. Motivational speech and addresses are being imparted by eminent personalities like Dr. C.B. Satpathy. A group of female employees have been assigned the responsibility of interacting with female employees or spouses of employees for inquiring their well-being and offering medical support, which your Company can complement.

DETAILS OF SUBSIDIARY/ JOINT VENTURES / ASSOCIATE COMPANIES

1) Adani Petronet (Dahej) Port Private Ltd.

A Solid Cargo Port through a Company named Adani Petronet (Dahej) Port Private Ltd., had commenced its operations in August 2010 at the Dahej Port. Solid Cargo Port Terminal has facilities to import/export bulk products like coal, steel and fertilizer. PLL has a 26% equity in this Solid Cargo Company and the balance equity is held by the Adani group.

Performance and Financial Position of Solid Cargo Joint Venture (JV) Company

(Rs. In Lakhs)
Particulars For the year ended 31st March, 2020 For the year ended 31st March, 2019
Revenue from operations 32,889 42,102
Profit/ (loss) from continuing operations 7,772 21,190
Other comprehensive income (177) (202)
Total comprehensive income 7,595 20,988
Company's share of total comprehensive income (26%) 1,974 5,456

2) India LNG Transport Co. (No. 4) Pvt. Ltd. (‘ILT4')

India LNG Transport Co. (No. 4) Pvt. Ltd. (‘ILT4') is joint venture of your Company with 26% ownership interest. ILT4 is the owner of vessel MT Prachi and is primarily engaged in transportation of LNG. It is one of the Company's strategic investments and has the principal place of business in Singapore.

Performance and Financial Position of ILT4

(Rs. In Lakhs)
Particulars For the year ended 31st Dec 2019 For the year ended 31st Dec, 2018
Revenue from operations 16,671 18,823
Profit/ (loss) from continuing operations (2,097) 9,437
Other comprehensive income - -
Total comprehensive income (2,097) 9,437
Company's share of total comprehensive income (26%) (545) 2,454

3) Petronet LNG Foundation

Petronet LNG Foundation, a Company Limited by Guarantee, has been promoted by the Company under the provisions of Section 8 of the Companies Act, 2013 and the rules made thereunder as a wholly owned subsidiary of the Company. Petronet LNG Limited 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 the Promoter to comply with its requirement of Corporate Social Responsibility (CSR) under provisions of Section 135 of Companies Act, 2013 and rules made thereunder.

CONSERVATION OF ENERGY AND TECHNOLOGY ABSORPTION

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's engineers have been interacting with industry peers, technology providers and EPC Contractors. They have also been nominated to important national and international seminars. A team has closely worked with Project Consultant and EPC Contractors in all phases of designing and construction of Dahej and Kochi LNG Terminals.

Conservation of Energy

1. Plant is using best technology and optimization practices for energy conservation.

2. Plant cold energy is being used for air conditioning of buildings and cooling in Nitrogen Generation Plant.

Steps are being taken by the company to use alternate source of energy as mentioned below:

1. Feasibility Study for 5 MW solar power plant is nearing completion.

2. Replacement of sodium and mercury lamps in plants with LED lights are being done to conserve energy.

Research & Development:

1. A pilot plant based on inhouse studies is being built to produce potable water from Air Heater Condensate water (which is a by-product of Re-gasification process) by its required treatment and mineralization.

FOREIGN EXCHANGE EARNINGS AND OUTGO

Your Company's foreign exchange earning was Rs. 13 crore (Rs. 57 crore during the FY 2018-19) and foreign exchange outgo was Rs. 29254 crore (33126 crore during the FY 2018-19) during Financial Year 2019-20.

ADEQUACY OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THE FINANCIAL STATEMENTS

There is a system deployed whereby each process owner access and certify the compliance of the relevant processes and controls on periodical basis. Further, audits and reviews are conducted by independent agencies including internal and statutory auditors. Their reports are being reviewed by the management and Audit Committee on the basis of same, improvements are carried out in the existing system on regular basis.

EXTRACT OF THE ANNUAL RETURN

In accordance with Section 134(3)(a) of the Companies Act, 2013, the extract of the annual return in the prescribed format (Form MGT-9) is annexed to this report.

CORPORATE SOCIAL RESPONSIBILITY (CSR)

Your Company fully understands its responsibility towards the society and has been constantly striving and trying its level best for contributing its bit towards causes leading to Social Development. In its endeavor to be more focused towards its social goals, the Company is developing a more structured approach to enhance access to quality healthcare, enrich the lives of communities in need, welfare of the war widows, environmental causes and enhance the educational facilities across geographies in the Country.

The Company is implementing short-term, medium-term and long- term strategy to channelize the resources in an organized manner so as to derive maximum socio-economic impact from the targeted approach. In line with its social goals as enumerated above, the Company has already identified several projects in the areas of Healthcare, Education, Welfare of the War Widows, Skill Development, Environment, Sports, Agriculture, Swacch Bharat, etc. where your Company will spend the annual CSR budget in a progressive and sustainable manner.

In terms of provisions of Companies Act 2013, an amount of Rs. 57 Crore is required to be spent on CSR activities in Financial Year 2019-20. However, considering the outbreak of the COVID-19 Pandemic, the competent authority revised and approved the CSR budget to a total of Rs. 118 Crore (One hundred Eighteen Crore Only). A total of Rs.117.96 Crore (One hundred Seventeen Crore and Ninety-Six Lakh Only) was spent on CSR activities viz. Rs. 100.00 Crore has been contributed to the PM Cares fund to combat COVID 19 pandemic and Rs. 17.96 Crore for CSR projects including Rs. 21 Lakh as Administrative Overheads in the FY 2019-20.

Nevertheless, your Company has been making constant efforts to reach optimum level of CSR expenditure and has achieved the target above the earmarked CSR budget of the FY 2019-20, resulting in tangible positive impact on society and has made commendable improvements over the previous years in terms of both spending as well as number of CSR projects taken up. The disclosure as per Rule 9 of Companies (Corporate Social Responsibility Policy) Rules, 2014 is attached herewith as Annexure B and form part of the Board Report.

Further, Petronet LNG Foundation (PLF), a Company Limited by Guarantee, has been incorporated on 31st March, 2017 by Petronet LNG Limited (PLL) as a promoter of the Company under the provisions of Section 8 of the Companies Act, 2013 and the rules made thereunder, and acts as the CSR Arm of PLL. Petronet LNG Foundation is facilitating the promoter to comply with its CSR under provisions of Section 135 of Companies Act, 2013 and rules made thereunder. It has already taken up some high impact projects and is in the process of finalizing projects/ programmes with higher project cost and impact. While all CSR projects have been carefully chosen giving utmost importance to quality of spending instead of just spending, some projects have been outstanding in their impact.

‘Petronet Kashmir Super-30' is one such outstanding CSR project which prepares underprivileged students of Kashmir to overcome various social and other disadvantages and helps them to compete with the best for admission into the premier engineering institutions like IITs and NITs by providing quality coaching and guidance. In the Healthcare front, in association with All India Institute of Medical Sciences (AIIMS), Bhubaneswar, PLF aims in transforming the Trauma & Emergency Care landscape in Odisha by extending support to construct a state-of-the art Level-I Trauma Care center at AIIMS Bhubaneswar and ensure best possible healthcare facility for the people of Odisha. In addition, PLF in association with Artificial Limbs Manufacturing Corporation of India (ALIMCO) is extending the support with Aid and Assistive devices such as motorized tricycles, tricycles, Smart phone, smart cane, BTE hearing aids, etc. for the Persons with Disabilities with an objective to empowering them in Delhi/ NCR, Bharuch (Gujarat) and Kochi (Kerala). Under Education, ‘Petronet Samkalp Super 30' is a programme which prepares underprivileged students for Civil Services Examinations by providing free quality coaching and guidance in Delhi.

‘Numma Onnu' is another project in Ernakulam District to provide free food to the needy and has been implemented with the Eranakulam District Administration. Further, in collaboration with CIPET, PLF is imparting skill development programme for local underprivileged youth in Gujarat, Kerala, Haryana & Himachal Pradesh by helping them be confident enough to find gainful employment. The company stood by the Nation to combat the COVID-19 pandemic by contributing Rs. 100 Crore to the PM Cares Fund and supported Heath Care Workers treating COVID-19 patients with PPEs of Rs. 1.53 Crore across Delhi, Kerala & Gujarat.

The Corporate Social Responsibility Policy of the Company is available at the website of the Company at the following weblink: https://www.petronetlng.com/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 was appointed by the Board of Directors as Additional Director (Independent Director) w.e.f. 9th April 2019.

2. Shri Rajender Singh, ceased to be Director (Technical) of the Company w.e.f. 20th July, 2019 due to his retirement on attaining the age of superannuation.

3. Shri B.C. Tripathi (Nominee Director of GAIL) ceased to be Director of the Company w.e.f. 1st August, 2019 consequent upon change of nomination upon his superannuation from GAIL.

4. Dr. Ashutosh Karnatak (Nominee Director of GAIL) was appointed by the Board of Directors as Additional Director w.e.f. 7th August, 2019. Further, Dr. Ashutosh Karnatak ceased to be Additional Director (Nominee Director of GAIL) w.e.f. 28th August, 2019 pursuant to the provisions of Section 161 of the Companies Act, 2013 as the notice of 21st Annual General Meeting (AGM) dated 15th July, 2019 was already circulated to the members of the Company, therefore, agenda in this regard did not formed part of the notice of 21st AGM.

Thereafter, Dr. Ashutosh Karnatak was again appointed by the Board as Additional Director (Nominee Director of GAIL) w.e.f 29th August, 2019.

5. Dr. T. Natarajan (Nominee Director of GMB/GoG) ceased to be Director of the Company w.e.f. 22nd August, 2019 due to change in nomination by GMB/GoG.

6. Shri Sanjeev Kumar (Nominee Director of GMB/GoG) was appointed by the Board of Directors as Additional Director w.e.f. 4th September, 2019.

7. Dr. M.M. Kutty, ceased to be the Director and Chairman of the Company w.e.f. 1st May, 2020 as he ceased to be Secretary, Ministry of Petroleum & Natural Gas, Government of India consequent upon attaining the age of superannuation.

8. Dr. Ashutosh Karnatak (Nominee Director of GAIL) ceased to be a Director w.e.f. 6th May, 2020 consequent upon change of nomination by GAIL.

9. Shri Manoj Jain, (Nominee Director of GAIL) was appointed by the Board of Directors as Additional Director w.e.f. 6th May, 2020.

10. Shri Tarun Kapoor, Secretary, Ministry of Petroleum & Natural Gas, Government of India was appointed as Additional Director and Chairman of the Company w.e.f.11th May, 2020.

11. Shri Sanjiv Singh (Nominee Director of IOCL) ceased to be Director w.e.f. 1st July 2020 consequent upon change in nomination by Indian Oil Corporation Limited due to his superannuation from the services of IOCL on 30th June, 2020

12. Shri Shrikant Madhav Vaidya (Nominee Director of IOCL) was appointed by the Board of Directors as Additional Director w.e.f. 1st July 2020.

13. Shri D Rajkumar (Nominee Director of BPCL) ceased to be a Director w.e.f. 20th July, 2020 consequent upon change of nomination by BPCL.

14. Shri Arun Kumar Singh (Nominee Director of BPCL) was appointed by the Board of Directors as Additonal Director w.e.f. 10th August, 2020.

The Board placed on record its sincere appreciation for valuable services rendered and contribution made by Shri Rajender Singh, Shri B.C. Tripathi, Dr. Ashutosh Karnatak, Dr. T. Natarajan, Dr. M.M. Kutty, Shri Sanjiv Singh and Shri D Rajkumar, 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 Shashi Shanker, Nominee Director, ONGC, would retire by rotation at the ensuing Annual General Meeting and being eligible offers himself for reappointment. In accordance of provisions of Companies Act, 2013, Shri Sanjeev Kumar (Nominee Director of GMB/GoG), Shri Manoj Jain (Nominee Director of GAIL), Shri Tarun Kapoor (Chairman), Shri Shrikant Madhav Vaidya (Nominee Director of IOCL) and Shri Arun Kumar Singh (Nominee Director of BPCL) who were appointed as Additional Directors of the Company after the date of last Directors' Report shall vacate their offices at the ensuing Annual General Meeting. Necessary notices have been received from them/Member(s) under Section 160 of Companies Act, 2013 proposing their candidature for appointment. The same has also been given at website of the Company at www.petronetlng.com. The Board recommends their appointment. Brief resume of directors seeking appointment and 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 company etc. as stipulated under SEBI (LODR) Regulations, 2015 and other statutory provisions are given in the annexure to the Notice of 22nd 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, 2020 were:

1. Shri Prabhat Singh, MD&CEO

2. Shri V. K. Mishra, Director (Finance) and CFO

3. Shri Rajan Kapur, CGM & Vice President – Company Secretary There were no changes in Key Managerial Personnel of the Company during the FY 2019-20.

ANNUAL 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 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 as appointed by the Board possess various skills / expertise which are required for the Directors in the context of the Company's business for effective functioning such as 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 in to the Board attend an orientation programme. 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 Companyat https://www.petronetlng.com/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.

NUMBER OF MEETINGS OF THE BOARD OF DIRECTORS

During the year, seven 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.com/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, 2020 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 formulated a Policy on materiality of Related Party Transactions and also on dealing with Related Party Transactions. The same has been posted 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 annexed 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 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, 2020 there were 506 employees excluding 2 Whole-time Directors.

SECRETARIAL AUDIT

M/s A. N. Kukreja, Practicing Company Secretary (M. No. FCS 1070, CP No. 2318), was appointed by Board of Director to conduct the Secretarial Audit of the Company for the financial year 2019-20 as required under Section 204 of Companies Act, 2013 and rules thereunder.

A Secretarial Audit Report for the Financial Year 2019-20 submitted by M/s A. N. Kukreja, a Company Secretary in practice, is annexed with this report along with Management's Reply on the Secretarial Audit Report for the Financial Year 2019-20.

CORPORATE GOVERNANCE

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 Financial Year 2019-20, is annexed to this report along with Management's Reply on the Auditors' Report on the Corporate Governance Report for the Financial Year 2019-20.

MANAGEMENT DISCUSSION AND ANALYSIS

The Annual Report contains a separate section on Management Discussion and Analysis which is annexed with the Directors' Report.

BUSINESS RESPONSIBILITY REPORT

The Business Responsibility Report covering initiatives taken with environmental, social and governance perspective has been prepared in accordance with the directives of SEBI and forms a part of the Annual 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 continued to enjoy cordial and smooth relations amongst all its employees at Dahej and Kochi terminals.

RISK MANAGEMENT

The Company has laid down policies and procedures to inform the Members of the Board about the risk assessment and minimization procedure. A Risk Management Committee periodically reviews the procedures to ensure that Executive Management controls risk through properly defined framework. The risk assessment framework encompasses, inter-alia, methodology for assessing risks on an ongoing basis, risk prioritization, risk mitigation, monitoring plan and comprehensive reporting system.

This Risk Management Framework supports your Company's business strategy and operations. Risk Management Framework is constantly updated for new and emerging risks emanating from business expansion and interests. The risks are evaluated, quantified & prioritized and mitigation plans are reviewed & monitored at various stages. Corporate Level Risk Management Committee oversees the implementation of the Risk Management Policy and Procedures which are periodically reviewed andmonitored by the Risk Management Committee and by the Audit Committee before presenting it to the Board. In the changing business scenario and expansion of your Company into various other activities, business risk and their mitigation plans are assessed on regular basis.

DETAILS OF ESTABLISHMENT OF VIGIL MECHANISM FOR DIRECTORS AND EMPLOYEES

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 for Directors and employees of the Company 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, 2020, no complaint was received under Vigil Mechanism and thus no complaint was pending as on 31st March, 2020.

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 given on the website of the Company.

LISTING ON STOCK EXCHANGES

The Company's equity shares are listed on the BSE Ltd. and National Stock Exchange of India Ltd. 9.05% Unsecured Redeemable Taxable Non-Convertible Debentures (NCD) (Series II) (Option II) were listed on National Stock Exchange of India Ltd. However, the samewere redeemed on 25th October, 2019 and extinguished.

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 year 2006-07 to 2011-12 to Investor Education and Protection Fund. Detail of the same is available at website of the Company at the following link https://www.petronetlng.com/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.com/cg.php

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 2019-20:-

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 2019-20, there was no cases 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, 2020. 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 T. R. Chadha & Co., Chartered Accountants LLP, have been appointed by the Shareholders of the Company as Statutory Auditors for the financial year 2019-20.

AUDITORS' REPORT

The Auditors have submitted an unqualified report for the financial year 2019-20. 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 Chandra Wadhwa & Co., Cost Accountants (Regn. No. 000239) as the Cost Auditors of the Company for the Financial Year 2019-20. The Cost Audit Report for the year 2018-19 has been filed under XBRL mode on 21st August, 2019.

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

Ministry of Corporate Affairs, through its Circulars dated 8th April 2020, 13th April 2020 and 5th May 2020, has allowed companies to conduct the general meetings through video conferencing(VC) or other audio visual means (OAVM) and non-printing of annual reports during the calendar year 2020. SEBI, through Circular No. SEBI/HO/CFD/CMD1/CIR/P/2020/79 dated 12.05.2020, has also relaxed certain provisions of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 in the wake of Covid-19 pandemic.

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. Kfin Technologies Private Limited, to register their email addresses with the depositories or the Company for receiving the Annual Report for 2019-20 and other communications.

The link for registration of email address is https://ris.kfintech. com/email_registration/ and the same is also available at our website at https://www.petronetlng.com/. 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.