Ub News » ONGC Q1 profit climbs 48% by Rupee depreciation
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India’s biggest energy explorer, state-run Oil and Natural Gas Corporation (ONGC) on Saturday announced a 48% increase in its net profit at Rs 6,078 crore in the first quarter of the current fiscal as against Rs. 4,095 crore in the same period a year ago.


ONGC’s net sales rose 24% to Rs 20,149 crore from April-June of this fiscal from Rs16,268 crore for the quarter a year ago.

During the quarter, the rupee declined 8.6% against the dollar. “Realisation in rupee is more and, thus, our profit is higher,” said Sudhir Vasudeva, chairman.

ONGC’s net crude realization at $46.62 a barrel, against $48.74 a barrel a year ago when Brent crude averaged $108.76 a barrel, 7% lower than a year ago.

The company paid a subsidy of Rs12,346 crore for first quarter of this fiscal to pay off downstream companies such as IOC, BPCL and HPCL for selling fuel at lower market price from Rs 12,046 crore year-on-year.

The Company does not fully benefit from rising crude prices because India caps prices of petroleum products such as diesel, cooking gas and kerosene and producers such as ONGC share the cost of subsidizing refineries by selling crude to them at a discount.

ONGC has made a significant oil pool discovery in its D1 field in the western offshore basin, off Mumbai, which, according to Sudhir Vasudeva, was the big discovery that had “eluded” ONGC so far.

The discovery would boost in-place reserves at the field to an estimated 140 million tons of oil-equivalent, from 82 million tons now, he said. The company has also made three other smaller discoveries in the past month.

Shares rose as much as 4.1% in early trade on Monday.

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