An increased subsidy burden pulled down the fourth quarter net profit of Oil and Natural Gas Corporation Ltd (ONGC), the state-owned oil and gas explorer, by 26 per cent at Rs 2,791 crore. The Maharatna public sector undertaking (PSU) had posted a net profit of Rs 3,776 crore in the corresponding quarter last year.
The company had to pay a fuel subsidy compensation of Rs 12,136 crore during the quarter, half of the overall burden of Rs 24,892 crore, as discounts on crude oil sold to refining companies, Chairman and Managing Director A K Hazarika said. The company had paid a fuel subsidy of Rs 4,999 crore in the corresponding quarter in 2009-10.
“ONGC’s sharing of the loss incurred by the fuel retailers, on selling diesel, domestic LPG and kerosene at controlled rates, went up to 38 per cent in 2010-11 from 33 per cent earlier. Our net profit would have been higher by Rs 2,000 crore had the fuel subsidy not increased,” Hazarika said.
The company’s net realisation on sale of every barrel of crude oil during the quarter stood at $38.75, after giving a discount of $70.15 per barrel.
For the full year (2010-11), net profit was up 13 per cent at Rs 18,924 crore as compared to Rs 16,768 crore in 2009-10. The full year profit would have been higher by Rs 14,247 crore in the absence of subsidy payouts.
Net realisation for the full financial year was $53.77 on every barrel sold after giving a discount of $35.64 per barrel.
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The company’s overall crude oil production last financial year was down to 24.42 million tonnes (mt)from 24.67 mt in the previous year. Gas production remained flat at 23.09 billion cubic meters.
Overall sales during the fourth quarter were up five per cent at Rs 15,554 crore. For the full year, sales jumped 10 per cent to Rs 66,152 crore.