ONGC profit doubles to Rs 7,083 crore

Written by fe Bureau | New Delhi | Updated: Jan 29 2011, 06:17am hrs
Higher crude oil price and a one-time receipt of dues on gas sales have enabled state-owned ONGC to more than double its net profit in the December quarter to Rs 7,083 crore. Net profit for the third quarter rose 131.9% from the same time a year ago, ONGC CMD R S Sharma told reporters here. In the first nine months of the fiscal, net profit rose 24% to Rs 16,133 crore.

The rise in profit for the December quarter was despite higher subsidy payout, Sharma said. ONGC has much more value to be unlocked. In the third quarter, the upstream company paid Rs 4,222 crore oil subsidy to downstream companies IOC, HPCL and BPCL by way of discounts on crude sold to them as against Rs 3,497 crore paid during the same time a year ago, ONGC stated. So far this fiscal, ONGC has paid Rs 12,757 crore as oil subsidy. ONGC shareholders have approved by postal ballot the proposals to split the company share into two, issue bonus share in the ratio of 1:1 and issue a special dividend, the company stated.

ONGCs board will meet again on Saturday to consider more business matters including the proposed $9.6 billion majority stake sale in Cairn India by its UK parent to Vedanta Resources.

Sharma said that ONGC pays the largest share of oil subsidy 80% among all the three upstream companies ONGC, Gail India and Oil India.

ONGC director finance DK Sarraf said the company received Rs 1,987 crore as dues on gas sales in the quarter and in subsidies on sale of fuel to the Northeast. The company sold 7.11 million tonne of crude oil in the October-December quarter at an average price of $89.13 a barrel.