Airlines bet high on ATF futures as MCX tweaks trading norms

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New Delhi, Sep 5: ATF volume supplied. Earlier, this charge was fixed at a modest rate (Rs 60/kl) and the oil PSUs were giving this royalty to Airports Authority of India (AAI) based on fuel consumption. Oil companies recovered throughput charges paid to AAI from the airlines. Till last year, the throughput charges were constant at around Rs 60/kl throughout the country. AAI in its effort to raise its revenue introduced a bidding process last year for throughput charges at the time of allotment of land for setting up fuelling service facility. In all, 27 airports were identified by AAI where land has been allotted via call of tenders against payment of throughput charges.

RIL was selected for 25 airports and the throughput charges quoted ranged from Rs 414/kl in Ahmedabad to Rs 96/kl in Raipur. For the other two airports, namely Chennai & Kolkata, IOC was awarded the contract at a throughput charge of Rs 1,201/kl and Rs 1001/kl, respectively. The impact on the airlines is the higher cost of ATF as the oil companies pass on this charge directly to the airlines. If a throughput charge of Rs 1,000/kl is imposed at all the airports, the airlines will have to shell out Rs 300 crore annually on this account.