India's crude oil production drops 4.15% to 34.2 million tonne in FY19

India's import dependency out of the total crude oil consumption increased from 77 per cent in 2014-15 to 84.7 per cent in the last quarter of 2018-19

India’s crude oil production for the financial year 2018-19 dropped 4.15 per cent to 34.2 million tonne (MT), compared to 35.68 MT during the financial year 2017-18. On the other hand, natural gas production during the same period showed a marginal increase of 0.69 per cent.

Cumulative natural gas production during April-March period of the last financial year was seen at 32873.37 million metric standard cubic meter (MMSCM), compared to 32649.31 MMSCM during the same period in 2017-18.

Among the public sector undertakings, state-run Oil and Natural Gas Corporation (ONGC) saw 5.4 per cent drop in its crude production during April to March 2018-19 to 21.04 MT versus 22.25 MT during April-March period of 2017-18. Natural gas production by the company during April-March, 2018-19 was 24674.65 MMSCM, 5.31 per cent higher than the production during the corresponding period of the last year. Some of the reasons for lower production include decline in pressure or potential in GS-4 Gas cap reservoir in Gandhar field.

Another public sector major Oil India Ltd (OIL) saw a decline in its crude oil production by 2.46 per cent to 3.3 MT during the last fiscal compared to 2017-18. Natural gas production by OIL during April to March period of 2018-19 also declined 5.54 per cent compared to the previous year. Interestingly, crude oil and natural gas production by the private sector and joint ventures were also down 1.9 per cent and 13.59 per cent, respectively during the period under review. The reason for drop in private sector gas production includes the closure of two wells in D1D3 field by Reliance Industries (RIL).

Refinery production during April-March, 2018-19 was 257204.86 TMT, which was 2.09 per cent higher than the production during the same period last year. CPSE Refineries’ production during the financial year was 150975.66 TMT, 3.95 per cent higher than the production last year.

The NDA government had lined up plans to bring down crude oil imports by 10 per cent by 2022 by increasing domestic production. However, the country’s import dependency out of the total crude oil consumption increased from 77 per cent in 2014-15 to 84.7 per cent in the last quarter of 2018-19. The drop in production is hence considered as a jolt to the government's plan.