The Hindu : Business : ONGC third quarter net profit dips

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Tuesday, Jan 22, 2008
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ONGC third quarter net profit dips

Special Correspondent

The company will invest about Rs. 16,000 crore in exploration and production

NEW DELHI: State-run Oil and Natural Gas Corporation (ONGC) on Monday announced a 6.4 per cent drop in net profit in the third quarter of 2007-08 with its subsidy payout to oil marketing companies (OMCs) trebling during the period.

Making an announcement here after the meeting of the board of directors, ONGC Chairman and Managing Director, R. S. Sharma, said the company posted a net profit of Rs. 4,367 crore despite selling crude oil at a record $91.19 a barrel price in the October-December quarter.

“We paid Rs. 6,080 crore towards subsidising petrol, diesel, LPG and kerosene in October-December as against Rs. 2,204 crore a year ago,” he said stating the reason for the dip in profits. After subsidy, ONGC’s net realisation in dollar terms was $54.52 a barrel. After factoring in the 12.23 per cent rise in rupee, the net realisation slipped to Rs. 2,151 a barrel from Rs. 2,288 a barrel in October-December 2006. Sales were also down 2.6 per cent at Rs. 15,218 crore, he said.

Mr. Sharma said ONGC was being made to pay royalty on crude oil produced to states at gross realisation and in effect it should be calculated at a price realised after the subsidy payout. He said ONGC would be investing about Rs. 16,000 crore in exploration and production during the current fiscal, up from Rs. 13,000 crore in the previous year which will go up to Rs. 18,000 crore next year. He said ONGC made nine discoveries during October-December — four new prospects and five new pool discoveries in earlier established fields.

In April-December, the corporation had made 19 discoveries — nine from new prospects and five from new pool. Crude oil production was almost unchanged at 6.62 million tonnes in October-December and 19.5 million tonnes in April-December 2007.

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