Kingfisher pays 40% of overdue fuel bill

Under pressure from Hindustan Petroleum Corp Ltd,Kingfisher Airlines has repaid 40 per cent of its overdue fuel bill and has agreed to give bank guarantee as insurance against default on future jet fuel purchases.

Hindustan Petroleum Corporation Limited (HPCL) is Kingfisher Airline’s (KFA) largest aviation turbine fuel (ATF) supplier and jet fuel (or ATF),like in case of other airlines,is sold on a 60-day credit.

The cash-strapped airline had,however,run an outstanding of Rs 298.80 crore over and above the agreed credit period.

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“We have vigorously pursued the issue with Kingfisher as a result of which the Rs 298.80 crore overdue outstanding as on March 4,has been reduced by Rs 122.17 crore,” a highly placed company source said.

As on May 21,KFA owes a total of Rs 479.35 crore to HPCL,of which only Rs 176.