ONGC logs ₹6,734 cr profit in Mar quarter
NEW DELHI: State-owned Oil and Natural Gas Corporation (ONGC) reported a net profit of ₹6,734 crore in the March quarter on the back of higher oil prices and exceptional income.
The firm had reported a net loss of ₹3,214.41 crore in the January-March 2020 period, according to a company press statement.
In an investor call, ONGC chairman and managing director Subhash Kumar said the company realised $58.05 for every barrel of crude oil produced and sold in JanuaryMarch as compared to $49.01 a barrel realisation a year back.
Also, the company reversed impairment losses, recording an exceptional gain of ₹2,613 crore in the quarter.
This follows a re-assessment of crude oil and natural gas prices, which have rebounded from lows hit last year.
Based on the assessment, the company has recorded a net impairment reversal of ₹2,613 crore for the January-March quarter and ₹1,375 crore for the year to March 31, 2021, he said.
“The increase in net profit in Q4 (of fiscal 2020-21) is mainly due to higher crude oil prices which were partly offset by historic low gas prices,” he said.
Domestic gas price under the administered pricing mechanism - which are revised once every six months - was $1.79 per million British thermal unit in the January-March quarter, down from $3.23 a year back.
Kumar said the disruption caused by the pandemic led to ONGC producing 3.5% less crude oil in the year at 22.53 million tonnes.
Gas output too was 8.4% short at 22.81 billion cubic meters (bcm).
For the current year, the company is targeting 22.56 million tonnes of crude oil production, almost unchanged from the previous year, he said.
“The shortfall in natural gas production is primarily due to less offtake by customers due to Covid-19 pandemic. This has resulted in a production shortfall of condensate and valueadded products (VAP) as well,” Kumar explained.
Gas production may however rise to 24.89 bcm this year as new output from KG basin and western offshore comes on stream.
Kumar further said, “We think the worst is behind us.” Prices are likely to increase 50-60% in the next revision due on October 1, he noted.
The company, he said, is targeting a capital spending of ₹29,500 crore in the current fiscal as compared to about ₹28,000 crore spend on oil and gas production in the previous fiscal.
ONGC expects to maintain its production dominance, contributing 65% of India’s projected 40 million tonnes a year of output in next three years, he added.
Gross revenue during the quarter declined 1.2% to ₹21,189 crore compared to the corresponding period last fiscal.
For the full year, FY21, ONGC registered a 16.5% decline in profit at ₹11,246 crore.