ONGC reported a 12 per cent rise in year on year net profit to Rs 4,611 crore as agai

[dk2424]

Wednesday, July 25, 2007 (New Delhi):

Oil and natural gas major ONGC reported a 12 per cent rise in year on year net profit to Rs 4,611 crore as against Rs 4,119 crore.

The company attributed the rise in profit due to the reduction in subsidy discounts in the quarter coupled with lower costs.

Subsidies to oil marketing companies on PDS Kerosene and domestic LPG and other products in form of discounts amounted to Rs 3,649 crore as against Rs 5,120 crore in Q1 of FY05-06.

Turnover for the quarter ended June 30 was down six per cent to Rs 13,728 crore due to appreciation of rupee and marginal reduction in production. According to the company, this had a negative impact on Revenues by Rs 1,500 crore and around Rs 900 crore on net profit.

The net realisation during the first quarter stood at $50.21 per barrel. The company also reported five discoveries, four in onshore and one in offshore of Mahanadi basin.

Kazakhstan oil assets

ONGC also reported that it entered into service contracts for development of 14 onshore marginal fields. The company also signed an agreement with Petroleo Brasileiro S.A. (Petrobras) for swapping of interests in offshore blocks in India and Brazil.

In a parallel development Lakshmi N Mittal stated that he plans to transfer the Kazakhstan oil assets that he acquired from Russia's Lukoil to his joint venture firm with ONGC Videsh Ltd.

However, officials at the state-run oil company remained sceptic if the promise would be fulfilled. In his first major oil deal, Mittal had in April acquired Russian oil firm Lukoil's 50 per cent stake in Caspian Investments Resources for $980 million.

The acquisition was to be done by ONGC Mittal Energy Ltd, the equal JV of OVL and Mittal Investment, but Mittal went ahead on his own citing opposition to OMEL from Lukoil.

He has since been delaying transferring the assets to OMEL citing opposition to such a move by the Kazakhstan government. "We are in discussion and I think it (CIR) will be transfered to OMEL," Mittal said.

Kazakhstan is one of the 10 countries Mittal had originally identified for exclusive pursuit of hydrocarbon opportunities in joint venture with ONGC. (With inputs from PTI)