SpiceJet Flight Operations Grounded After Oil Companies Stop Fuel Supply

17/12/2014 10:58 AM IST | Updated 15/07/2016 8:24 AM IST
BOE956 to PAE. Line 3218, Cn 36367.

NEW DELHI -- Flight operations of SpiceJet were grounded today after oil marketing companies refused to supply jet fuel to the cash-strapped airline. "Not even a single flight has taken off till this morning due to fuel supply issue with the oil companies," sources told PTI.

The state-run oil marketing firms have not yet taken a decision on the resumption of jet fuel supply to SpiceJet on a two-weeks credit facility, they said.

When contacted, an airline spokesperson said operations were likely to be "normal" shortly.

Coming to the rescue of the beleaguered carrier, the Civil Aviation Ministry had yesterday said it will request the oil companies and the airport operators to extend a 15-day credit facility to SpiceJet in a bid to save the airline from shutting down.

The Aviation Ministry had said it may request Indian banks/financial institutions to extended loans of upto Rs 600 crore to the airline as part of measures to keep the carrier functional.

Besides, it will also request the Finance Ministry to permit external commercial borrowing (ECB) for working capital as special dispensation.

The measures, however, come with a rider that the airline will commit capital infusion at the earliest.

The steps came after SpiceJet's Chief Operating Officer Sanjiv Kapoor, along with Sun Group CFO S L Narayanan, met the Civil Aviation Minister and DGCA Prabhat Kumar on Monday and sought the government's help to overcome the crisis.

"Indian banks may be requested to give some working capital loan based on the assurances of the promoter. Banks or financial institutions to lend up to Rs 600 crore backed by a personal guarantee of the Chairman, SpiceJet," a ministry release had said.

At the same time, the airline, with total liabilities standing at Rs 2,000 crore, including dues to the public sector oil firms and the Airports Authority of India (AAI), may get credit facility for up to 15 days from the oil firms and AAI, the government had said.

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