New Delhi: State-owned Oil and Natural Gas Corp (ONGC) on Wednesday reported a 40 percent drop in its March quarter net profit as oil and gas output fell while payments on account of statutory levies rose sharply.
Net profit in January-March at Rs 3,387 crore was 40 percent lower than Rs 5,644 crore in the same period a year ago, ONGC Chairman and Managing Director Sudhir Vasudeva told reporters here.
Oil output fell to 5.62 million tonnes in Q4 from 5.78 million tonnes a year ago while natural gas production declined to 5.58 billion cubic metres (bcm) from 6.03 bcm in January-March 2012, he said.
Also, cess oil on crude oil as well as royalty payments rose by Rs 1,043 crore in the quarter, ONGC Director (Finance) A K Banerjee said adding an additional provision of Rs 1,698 crore was made for increased operating expenditure because of employee benefit scheme.
The government had last fiscal raised cess on crude oil to Rs 4,500 per ton from Rs 2,500 previously.
Also, ONGC had to shell out more royalty on crude oil produced from Cairn India's Rajasthan block.
ONGC, which holds 30 percent interest in the Rajasthan block, is the licence of the block and is liable to pay royalty on 100 percent of crude oil.
Banerjee said the company had to make higher provision for dry wells and survey expenditure in the quarter.
Payment of statutory levies increased from Rs 4,521 crore in January-March 2012 to Rs 5,561 crore in Q4 of 2012-13, he said.
ONGC had to shell out Rs 12,312 crore in march 2013 quarter so that diesel, domestic LPG and kerosene can be sold by retailers at subsided rates to public. The subsidy outgo was lower than Rs 14,170 crore in the same period last fiscal.
Vasudeva said but for subsidy, ONGC profits should have been higher by Rs 6,900 crore in the quarter.
The company's March 2013 quarter sales were up 13.1 percent at Rs 21,460 crore.
For the fiscal, net profit was down 16.7 percent to Rs 20,926 crore on record subsidy payout. ONGC paid Rs 49,421 crore in 2012-13, up from Rs 44,466 crore in the previous year. But for this record subsidy outgo, net profit should have risen by Rs 28,413 crore, he said.
"Last year we had a one-time gain of Rs 3,141 crore after Cairn India agreed to reimbursement of cess and royalty ONGC pays on crude oil produced from its Rajasthan block," he said.
Vasudeva said ONGC plans to invest Rs 35,049 crore in 2013-14 up from Rs 29,503 crore in the previous fiscal.
ONGC's turnover in 2012-13 fiscal rose by 8.4 percent to Rs 82,552 crore.
Shares of ONGC today closed 0.21 percent higher at Rs 334.00 apeice on the BSE.
First Published: Wednesday, May 29, 2013, 19:15