Net profit of GAIL India declined 28.7 per cent to Rs 808 crore during April-June quarter from Rs 1,134 crore in the year-ago period.
The country's largest gas transmission and marketing company witnessed 16 per cent growth in sales to Rs 12,856 crore during the quarter.
The state-run utility witnessed fall in net profit as it transported less gas and its LPG margins declined on drying up of supplies from Reliance Industries’ KG-D6 gas fields.
GAIL transported 99 million standard cubic metres (mscmd) a day of gas during April-June, down from 110 mscmd a year ago.
Its trading volumes fell after BG Group-operated Panna/Mukta and Tapti fields in western offshore saw production drop to 6.9 mscmd from 10.3 mscmd.
As output at the eastern offshore gas fields fell to an all-time low of 14 mscmd, GAIL stopped receiving gas from D6 to its LPG plants.
Also, the firm’s outgo on fuel subsidy remained unchanged at Rs 700 crore despite the company not getting any of the cheaper KG-D6 gas for LPG production.
Upstream firms like Oil and Natural Gas Corporation and GAIL make up for at least one-third of the revenues that retailers lose on selling auto and cooking fuel at government controlled rates, way below market cost.