Oil and Natural Gas Corporation (ONGC) reported a more than 34% decrease in net profit for the June quarter, attributed to lower oil prices and reduced output. The company’s net profit was Rs 10,015 crore in the first quarter of the current fiscal year (2023-24), compared to Rs 15,206 crore during the same period last year. ONGC, India’s leading producer of crude oil and natural gas, earned USD 76.49 per barrel for its produced and sold crude oil, down from USD 108.55 per barrel the previous year. This decline in profit was influenced by the surge in global oil prices during April-June 2022, prompted by uncertainties caused by Russia’s invasion of Ukraine.
The company’s gross revenue also dropped by 20% to Rs 33,814 crore. Crude oil production decreased by 3.2% to 4.6 million tonnes, and gas output declined by 3.3% to 5.04 billion cubic meters. Various factors contributed to this reduction in production, including the commissioning of a new crude oil pipeline, disruptions caused by cyclone Biparjoy, and a pipeline leakage affecting crude oil wells in southern India.
To counter the production decline from mature and marginal fields, ONGC is implementing interventions and new drilling activities. The company made four oil and gas discoveries in the first quarter, including new prospects both offshore and onland. One notable discovery is in the Mid and South Tapti field in Mumbai offshore, named ‘Pukhraj. In the Krishna Godavari basin onland block, a development well encountered a new hydrocarbon-bearing pay zone.
By the end of the week, ONGC’s shares closed at Rs. 177.15 on the BSE, marking a 0.81% decrease.