Cairn India today reported a 53 per cent drop in its December quarter net profit, crimped by the slump in global oil prices and drop in production.
Net profit in October-December at Rs 1,350 crore, or Rs 10.72 per share, was 53 per cent lower than Rs 2,884 crore, or Rs 16.86 a share, in the same period a year ago, Cairn said in a statement here.
Profits were down as the price of oil it realised fell 29 per cent to USD 68.7 per barrel from USD 96.3 in third quarter of previous fiscal.
Revenue fell 30 per cent to Rs 3,504 crore.
Cairn’s showpiece Rajasthan field output was 4 per cent lower at 178,400 barrels of oil per day.
Mayank Ashar, Managing Director and CEO of Cairn India, said the company was looking at operational efficiencies in the current crude price environment.
“Our cash rich balance sheet and best-in-class cost profile provide a solid foundation to operate the high margin core fields. This gives us the optionality to be selective about growth projects, contingent upon the oil price environment. We are uniquely positioned to generate positive free cash flows,” he said.
In the core Mangala-Bhagyan-Aishwariya or MBA fields, which have 2.2 billion barrels of discovered hydrocarbons in place, focus continues on infrastructure creation and prudent reservoir management, Cairn said.
“Bhagyam field has been challenging to develop and operate from the start and work towards increasing recovery rates continues. Discussion with the joint venture partner for alignment on enhanced oil recovery (EOR) implementation at Bhagyam is ongoing,” it said.
Cairn holds is the operator of the Rajasthan block with 70 per cent interest. State-owned Oil and Natural Gas Corp (ONGC) has the remaining 30 per cent.
During the last quarter, the production volume from Aishwariya field ramped up to 30,000 barrels per day.
Cairn said development of gas field in the Rajasthan block continues in line with the target to double gas production by Q4 FY 2015.
“Management committee approval on Raageshwari field development plan of 100 million standard cubic feet per day is in advanced stages and work on execution planning and contracting is underway,” it said.