Imperial Energy, the Russia-focused oil firm that India’s Oil and Natural Gas Corporation (ONGC) acquired recently, is likely to post its maiden cash profits next financial year as it ramps up output.
Imperial had in calendar year 2007 posted cash losses of $40 million which in 2008 rose to $100 million.
“We hope to cut cash losses to $15-20 million in 2009 and will see cash profits in 2010,” a company official said. ONGC Videsh Ltd (OVL), the overseas arm of the state-run firm, is currently in the process of consolidating operations.
“When we took over (Imperial in January 2009), oil production had fallen to below 6,000 barrels per day (bpd). We were able to restore it to about 8,200 bpd by May and have now ramped it up to 11,200 bpd,” he said. “We are targeting 16,000 bpd by the year end and 25,000 bpd by end of 2010,” he added.
When OVL took over the management of Imperial from its British owners, it faced a virtual revolt with senior personnel threatening to quit. OVL Managing Director R S Butola rushed to this sleepy town in Western Siberia which is the headquarter of Imperial to firefight. In a very short span, Imperial’s entire operations were mapped, 15 personnel key identified and they were convinced to stay put.
Today OVL is firmly in command with operations being headed by Ashok Verma, who had in his previous stint handled an equally difficult Assam fields of ONGC.
In Imperial, OVL faces extreme climate and terrain challenges with temperatures ranging from 40 degree Celsius to minus 40 degree Celsius and fields located as far as 600 km from Tomsk town.