ONGC Videsh profit drops by 39% in Apr-Sept

The poor numbers may be attributed to drop in output in Sudan and Syria.

ONGC Videsh Ltd, the overseas arm of state-owned Oil and Natural Gas Corp (ONGC), reported a 39% drop in net profit for the first 6 months of current fiscal as output dropped in nations like Sudan and Syria.

Net profit in April-September at Rs 1,649 crore dropped 39.3% from Rs 2,717 crore in the same period a year ago, the company said in a press statement here.

OVL, which has 31 oil and gas assets in 15 countries, said crude oil production dropped 32.9% to 2.276 million tonnes from 3.39 million tonnes in H1 of 2011-12. Natural gas output was up 4.8% to 1.212 billion cubic meters.

Sales dipped 33.2% to Rs 8,279 crore in six months to September 30.

The company did not give quarterly break-up.

OVL said oil production from its fields in Sudan had been shut since January following a split of the African nation. Also, current geo-political situation in Syria including EU sanctions and the resulting restrictions have made operations "difficult" since December 2011.

It is targeting production of 20 million tonnes of oil and oil equivalent gas by FY'18 and 60 million tonnes by FY'30.

OVL in September acquired Hess Corp's 2.7213% participating interest in the Azeri, Chirag and the Deep Water Portion of oil Guneshli fields in the Azerbaijan sector for USD 1.001 billion.

"The acquisition would bring 9% additional proved reserves to OVL portfolio and daily oil production of about 19,000 barrels," it said.

Also, production of gas started in Lan Do field in Block 06.1 in Vietnam from October 7. "This shall create additional production capacity of 0.20 billion cubic meters (OVL Share) (17% increase) from the block," it said.

OVL said post secession of South Sudan from Sudan with effect from July 9, 2011, the company's oil Blocks 1,2 and 4 straddle between the two countries and Block 5A is now entirely in South Sudan.

The Government of South Sudan has now issued order resumption of crude oil production followings its agreement with the Governments of Republic of Sudan. "The production from part of Block 1,2 and 4 falling under South Sudan and Block 5A is likely to resume in next few months," the statement said.

At present, the company has two projects under development namely Carabobo 1 in Venezuela, which is likely to commence early production by end of FY13 and Blocks A1 & A3 in Myanmar, which are likely to commence production in July, 2013.

"OVL continues to pursue its objective of acquiring oil and gas equity abroad for energy security of the country and envisioned to accelerate the acquisition of oil and gas properties overseas to supplem