ONGC Reports Record-High Profit, Driven by Higher Crude Oil and Gas Realisations

State-owned Oil and Natural Gas Corporation (ONGC) on Thursday reported a 57.3% year-on-year (y-o-y) jump in standalone net profit to Rs 15,488.64 crore for the September quarter, driven by sharply higher crude oil and gas realisations despite a decline in production. The strong earnings pushed its first-half profit to a record ₹32,522.45 crore, nearly matching the Rs 32,894.02 crore earned during the entire previous financial year. The country’s largest oil and gas producer had reported a standalone net profit of Rs 9,847.97 crore in the corresponding quarter last year. However, profit declined sequentially from Rs 17,033.81 crore in April-June. Revenue from operations rose 32.8% to Rs 43,875.15 crore from Rs 33,030.56 crore a year earlier. The earnings improvement was largely supported by stronger crude realisations. ONGC’s nominated-field crude fetched $92.33 per barrel, up 37.1% from $67.34 a year earlier, while joint-venture crude realisations increased 41.9% to $97.02 per barrel. New-well gas prices rose 22.5% to $10.24 per million British thermal units (mmBtu), against $8.36 earlier. Nominated-field gas prices increased to $7 from $6.75 per mmBtu. New-well gas generated Rs 7,050 crore in revenue during the first half, contributing over 34% of ONGC’s nominated-field gas revenue. However, standalone crude production declined to 4.437 million tonne from 4.630 million tonne, while natural gas output slipped to 4.839 billion cubic metres from 4.918 billion cubic metres. ONGC attributed the decline to “reservoir behaviour complexities in KG-98/2 Asset” and “monsoon related operational challenges and associated delays” in pipeline replacement projects PRP-8 and PRP-9. “Gas production from onshore fields was also affected by lower customer offtake during the quarter, following disruptions at certain major consumer facilities that temporarily reduced demand,” the company said. To address production challenges, ONGC expanded BP’s technical services engagement across Western Offshore fields to “arrest natural decline and accelerate development activities.” Meanwhile, consolidated net profit increased 46.9% to Rs 18,535 crore, while consolidated revenue rose 25.6% to Rs 1,98,263 crore. The board declared its highest-ever single-instalment interim dividend of Rs 10,064 crore, equivalent to Rs 8 per share. ONGC also awarded two Western Offshore development projects worth Rs 11,800 crore, expected to unlock 22 million tonne of oil-equivalent hydrocarbon potential. Separately, it awarded a pipeline replacement project exceeding Rs 4,300 crore. The company reported two onshore hydrocarbon discoveries, Amraghat-1 in Assam and Vadatal-48 in Gujarat, besides confirming a gas-bearing exploratory well in the Mahanadi deepwater basin. The board also approved an inter-corporate loan facility of up to Rs 10,000 crore for wholly-owned subsidiary ONGC Videsh .