New Delhi: State-owned Oil and Natural Gas Corp (ONGC) on Monday reported 17.5 percent drop in net profit for its third quarter ended December as crude oil output fell.
Net profit at Rs 5,563 crore during October-December, 2012-13 was lower than Rs 6,741 crore in the year-ago period, ONGC Chairman and Managing Director Sudhir Vasudeva told reporters here.
Vasudeva said the profit in Q3 last year was higher due to Rs 3,142 crore one-time exceptional income from cost recovery being allowed on royalty it paid on Cairn India's Rajasthan oil block.
The benefit of the decision came for the full year in that quarter and if this exceptional item was excluded, the Q-on-Q net profit should have been higher by Rs 736 crore, he said.
Also, ONGC's share in fuel subsidy was marginally lower at Rs 12,433 crore as against Rs 12,536 crore in October-December 2011-12.
Upstream firms like ONGC bear a portion of the losses retailers incur on selling diesel, domestic LPG and kerosene at government controlled rates. This they do by selling crude oil at discount to the refiners.
ONGC realised USD 47.97 per barrel after paying a discount out of USD 110.16 a barrel gross realisation. The net realisation was higher than USD 44.71 a barrel realised in Q3 last year.
Vasudeva said the net profit would have been higher by Rs 7,260 crore if it were not to foot the subsidy bill.
ONGC produced 6.05 million tons of crude oil in the third quarter, 3.02 percent lower than 6.244 million tons output a year ago. Gas sales were almost unchanged at 5,026 million standard cubic meters while production of value added products was down 1 percent to 831 kilo tons.
The company's turnover was up 16 percent to Rs 21,089 crore.
The profit posted in Q3 was the lowest quarterly profit ONGC reported in more than a year.
The company's total expenses increased to Rs 14,160 crore from Rs 12,000 crore a year ago.
Vasudeva said ONGC will next year produce 2.1 million tonnes more crude oil and 0.8 billion cubic metres per day of additional gas in next fiscal.
ONGC will end the current year with about 27 million tonnes of oil and 25.7 bcm of gas.
He said the profit has been impacted by the rise in oil cess from Rs 2,500 to Rs 4,500 per tonne. The company shelled out Rs 1,868 crore in additional cess this year.