ONGC stays in black despite slumping global oil prices
State-owned ONGC on Thursday reported 19.5 per cent drop in net profit to Rs 3,935 crore for the quarter ended March 31, 2015, mainly due to higher operating cost and write-off on dry wells drilled. The net profit of Oil and Natural Gas Corporation in January- March was lower than Rs 4,889 crore in the January-March period of the previous fiscal, 2013-14, ONGC Chairman and Managing Director Dinesh K Sarraf told reporters here.
While the company realised $55.63 for every barrel of oil produced as compared to $44.87 per barrel in the fourth quarter of the previous fiscal, operating cost rose by Rs 1,278 crore, impacting the profit. The company wrote off Rs 291 crore of exploration expense for drilling wells that did not result in any discovery. Besides, revenue from <g data-gr-id="72">value added</g> products (VAP) was down 35 per cent to
Rs 1,866 crore. For the full 2014-15 fiscal, the company wrote off about Rs 10,000 crore, of which Rs 2,700 crore was on account of dry wells, Sarraf said.
Also, the company had lower production from joint venture fields. Sarraf said the company was exempt from paying any fuel subsidy in the fourth quarter of 2014-15 and will also not be required to pay any in the first quarter of current fiscal. Turnover was up 1.3 per cent to Rs 21,683 crore.
While it was not required to pay any subsidy in Q4, the subsidy payout in full 2014-15 fiscal was Rs 36,300 crore that left a Rs 20437 crore <g data-gr-id="69">dent</g> on its <g data-gr-id="68">bottomline</g>, he said.
ONGC, which along with Oil India Ltd and GAIL meets more than half of the losses retailers incur on selling LPG and kerosene at <g data-gr-id="70">government controlled</g> rates, had a net profit of Rs 17,733 crore in 2014-15, down 19.7 per cent over previous year net of Rs 22,095 crore. Crude oil production was marginally lower at 6.45 million tonnes in Q4 as opposed to 6.47 million tonnes a year ago. Gas output was down 5.83 <g data-gr-id="71">per cent</g> to 5.81 billion cubic meters.
Oil and Natural Gas Corporation’s 100 per cent overseas operations subsidiary ONGC Videsh Ltd (OVL) had a 1,904 crore net profit on sales of Rs 18,491 crore in 2014-15 fiscal. It produced 5.53 million tonnes of crude oil in 2014-15, marginally higher than 5.48 million tonnes a year ago. Gas output was 16.37 per cent higher at 3.34 billion cubic meters.
Not right time to list overseas arm ONGC <g data-gr-id="86">Videsh,</g> rules CMD Dinesh
<g data-gr-id="117">Government</g> wants ONGC to list its overseas arm, ONGC Videsh, to improve its <g data-gr-id="104">valuations</g> but the company feels it is not the right time to list. The Department of Disinvestment had earlier this month written to all ministeries asking them to list all subsidiaries of public sector companies, with a view to <g data-gr-id="102">unlock</g> value and improve <g data-gr-id="103">valuation</g> of the government shareholding. Following the letter, the oil ministry wrote to Oil and Natural Gas Corp (ONGC) to list its 100 per cent overseas investment arm, ONGC Videsh Ltd. The company, however, felt this was not the right time to list as oil prices are down and the company may not get the right price.
“There is no proposal with the company to list OVL at present,” ONGC CMD Dinesh K Sarraf told reporters here. OVL Director (Finance) S P Garg confirmed receiving the letter from the ministry but said the company has written back explaining why it was not the right time to list the company. OVL has stake in 36 projects in 17 countries including Azerbaijan, Kazakhstan, Russia, Brazil, Colombia, Venezuela, Iraq, Syria, Libya, South Sudan, Sudan, Mozambique, Bangladesh, Myanmar, Vietnam and New Zealand.
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