Oil and Gas News

ONGC approves the quarterly financial results for Q1 FY09

ONGC in its 181st Board Meeting held on 28th July 2008 approved the quarterly financial results for Q1 FY09 with highlights as under: 
 
Turnover Rs. 20,123 Crore (up 47% from Rs. 13,728 Crore) due to higher price realization, after netting of subsidy burden of Rs. 9,811 Crore 
 
The subsidy burden has increased from Rs. 3,649 Crore in Q1 FY 07 - 08 to Rs. 9,811 Crore in Q1 FY09 - Highest ever so far 
 
The gross realization in respect of Crude Oil during Q1 FY09 is US$ 125.84/bbl (US$ 71.90/bbl in Q1 FY08). The net realization is US$ 69.14/bbl as against US$ 50.34 in Q1 FY08 
 
The net profit is Rs. 6,636 Crore as against Rs. 4,611 crore in Q1 FY08 
 
Crude Oil production in Q1 FY09 is 6.41 MMT (excl. JVs share of 0.43 MMT) compared to 6.38 MMT (excl. JVs share of 0.50 MMT) in Q1 FY08. The production has improved marginally in respect of ONGC (excl. JVs) 
 
Natural Gas Production in Q1 FY09 is 5.63 BCM (excl. JVs share of 0.76 BCM) as against 5.50 BCM (excl. JVs share of 0.60 BCM) in Q1 FY08. The production has improved marginally. 
 
Production of Value Added Products increased from 729,000 Tonnes to 753,000 Tonnes. 
 
2. Foray into Uranium Exploration 
ONGC Board approved entering into a MoU with Uranium Corporation of India Ltd. (UCIL), for exploration and exploitation of Uranium. This collaboration with UCIL is to leverage ONGC’s expertise in exploration of hydrocarbons, to commercially exploit this vital and strategic mineral. Currently ONGC is passively studying the prospects through ONGC Energy Centre (OEC) by studying the logs of existing wells. There would be an opportunity to synergize the respective strengths of both ONGC and UCIL in pursuing opportunities for exploration and exploitation of Uranium in India and abroad. 
 
3. ONGC Board approved Projects & Facilities to Produce & Supply 6.0 MMSCMD Gas from Tripura Gas Field, at a total estimated Capital Cost of Rs. 4376.01 Crore, in 3 phases. The production and revenue generation would commence from 2008-09. 
 
4. ONGC Board approved development of the North Tapti field (Tapti Daman block) at an estimated expenditure of Rs. 580 Crore. The project is expected to be completed by 2011. 
 
5. Performance Highlights Q1, FY09 
 
5.1 Discoveries: ONGC made the following eleven (11) Oil and Gas discoveries 
 
5.2 ONGC to feed Neepco’s 104 MW gas power station at Tripura 
 
ONGC will supply 0.5 million cubic meters per day of Gas for a period of 15 years to the gas-based power station of North Eastern Electric Power Corporation Ltd. (NEEPCO) coming up at Monarchak at Tripura. The agreement, signed on 5th June 2008, is the first agreement to be signed by ONGC at market price in Tripura. 
 
5.3 Tripura Power Project 
The 726 MW ONGC Tripura Power Project (OTPC), a JV promoted by ONGC with IL&FS and Govt. of Tripura has awarded M/s.BHEL, the Generation Project EPC at a cost of Rs. 2207 crore. The project is to be completed by March 2012. 
 
5.4 Dahej Petrochemical Complex 
For Dahej Petrochemical project being implemented by ONGC Petro additions Ltd. (OPaL), a JV promoted by ONGC with GSPCL, the Site Infrastructure Development Work has been awarded to M/s IVRCL on LSTK basis at a lump-sum price of Rs. 837.61 Crore with the scheduled completion of 21 months. 
 
5.5 ONGC has entered into an MOU with Torrent Power Ltd (TPL ) for supply of power to Dahej SEZ Ltd. 
 
5.6 Field Development of Mangala, Aishwariya, Raageshwari and Saraswati (MARS) fields in Rajasthan: Four discoveries in Barmer Basin of Rajasthan, viz. Mangala, Aishwariya, Raageshwari and Saraswati (MARS), where ONGC has a 30% Participating Interest (PI), will be developed at the same time. The estimated Capital Expenditure (Capex) for development of these discoveries is Rs. 6014 crore. ONGC’s share (30%) in this Capex is Rs. 1804 crore. These fields are expected to produce 286.41 million barrels of Oil till 2020. (ONGC share is 85.92 million barrels) 
 
5.7 Climate Change Mitigation Initiatives 
 
5.7.1 United Nations nod for 4th Clean Development Mechanism project: 
ONGC registered its 4th Clean Development Mechanism (CDM) project with the UNFCC from which will accrue 8793 Certified Emission Reduction (CER) annually for ten years that is equivalent to annual earnings of nearly Rs 7.7 million of Green Revenue [ 1 CER = 16 Euros (approx.) ]. This takes ONGC’s total annual accruable CERs to nearly 1.2 Lakh. 
 
ONGC has the unique distinction of being the only central Public Sector Undertaking (PSU) in the country with four of its CDM projects registered with UNFCCC. 
 
5.7.2 ONGC wins laurels for its efforts toward Climate Change Mitigation 
For its ‘Green’ initiatives, ONGC received the inaugural Earth Care Award on 22nd April, 2008. 
 
ONGC also won 2008 Golden Peacock award for its impeccable record in Climate Change Mitigation. Further, ONGC’s Institute of Drilling Technology secured the Golden Peacock award under ECO-Innovation category in Oil & Gas Sector, while Corporate Health Safety & Environment (HSE) section of ONGC bagged the award under the Environment Management category. 
 
5.8 Fortune rank improves 
 
ONGC’s position in the latest Fortune Global 500 listing of World’s largest Corporations by Turnover for the year 2008 improved 34 notches to 335 from its earlier ranking of 369. 
 
5.9 OVL acquires Stake in San Cristobal Project in Venezuela 
During the visit of Hon’ble Minister of P&NG, Government of India, to Venezuela, the agreement for forming a Joint Venture of PDVSA and OVL for the San Cristobal project was signed on 8th April 2008 with OVL’s share of 40% in the project involving investment of around USD 356 million. The field is currently producing about 32,000 bopd. 
 
The production of Oil & Gas during the first quarter of FY09 was approximate 2.074 MMT (O+OEG) as against the plan of 2.024 (O+OEG), i.e. 102.5%. 
 
5.10 MRPL records sterling performance 
MRPL records sterling performance for the quarter. Net profit is up 129%. Turnover during the quarter was up 46% at Rs.10,747 crore (Rs.7,376 crore). Net profit after tax is Rs.845 crore (Rs.368 crore). After providing for interest and finance charges of Rs.36 crore (Rs.40 crore), depreciation of Rs.95 crore (Rs.94 crore) and tax provision of Rs.474 crore (Rs.250 crore). 
 
The net profit after tax during the quarter is higher mainly due to inventory gain of Rs.655 crore net of tax on account of increase in average crude price from approx. US $ 100 per barrel in March 2008 to US $ 129 per barrel in June 2008. Exports during the quarter was Rs.2,852 crore (Rs.2,911 crore). Throughput during the quarter was 2.77 MMT as against 3.16 MMT mainly due to plant shutdown of Phase-II crude units of 6MMTPA during April 2008 for about 10 days. 
 
5.11 International recognition for Director (Exploration) of ONGC 
Mr. D K Pande has become the first Indian to be elected as Vice President of the Youth and Gender Engagement Plan of the World Petroleum Council (WPC). 
 
Commenting on the Q1 results, C&MD ONGC Mr. R S Sharma complimented Team ONGC and said that the fiscal has started strongly on a positive note, and ONGC’s focus on unlocking more value would yield results in the coming quarters as well, and both E&P and financials, are expected to be improve further. 
 
Corporate Communications
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