Highest-Ever Revenue Earned by OVL during 2011-12

OREANDA-NEWS. May 23, 2012. The financial results of ONGC Videsh Ltd. (OVL), the wholly-owned subsidiary of ONGC, for the financial year 2011-12 were considered and approved by the Board of Directors in its meeting held on 21st May 2012. The highlights of the results are as under:

*Production was lower mainly due to problems in Sudan and Syria assets as explained subsequently. Excluding Syria and Sudan, production for 2011-12 was almost at the level that of 2010-11.

During the year, the company achieved the highest-ever total revenue of 22,637 Crore, an increase of 21.2% as compared to the previous year. Profit after tax (PAT) for the current year has increased only marginally by 1.1% from 2691 crore to 2721 crore due to certain abnormal provisioning.

Highlights:

OVL is currently having participation in 30 projects in 15 countries, out of which 10 are producing projects.

During the year, the company has acquired 25% participating interest (PI) in Satpayev Block, Kazakhstan and exploration activities have started in the block. The remaining 75% PI is held by KMG, the National Oil Company of Kazakhstan.

A provision for Impairment of 1953 crore (USD  408 Million) has been made in respect of subsidiary, Jarpeno Ltd. as the asset is performing lower as compared to the estimated and the ‘value in use’ computed for the asset as on 31st March, 2012 was lower than its carrying value.

Post secession of South Sudan from Sudan w.e.f. 9th July, 2011, Blocks 1,2 and 4 straddle between the two countries and Block 5A is now entirely in South Sudan. Company’s operations in South Sudan are temporarily under shutdown from 23rd January, 2012 because of lack of agreement between the Governments of South Sudan and Sudan for use of processing, transportation and port facilities in Sudan for crude oil produced in South Sudan. Company’s production in Sudan was also adversely impacted during April 2012 due to partial damage to the processing facility in Sudan. Production has been partially restored in Sudan from 1st May 2012.

Also, the current geo-political situation in Syria including EU sanction and the resulting restrictions on Contractor has created a difficult situation in the project since December 2011.

The company currently has two projects under development namely Carabobo 1, in Venezuela, where first oil is expected in December 2012 and Blocks A1 & A3 in Myanmar, which are likely to commence production in May 2013.

OVL continues to pursue its objective of acquiring oil and gas equity abroad for energy security of the country. Team ONGC Videsh is currently finalizing its long term plan as a part of ONGC Group’s Perspective Plan 2030, which is expected to be announced shortly. Shri Sudhir Vasudeva, Chairman, complemented Team ONGC Videsh for sustaining growth with a balanced portfolio of assets and envisioned to accelerate the acquisition of oil & gas properties overseas to supplement the domestic crude oil and natural gas production towards energy security of the country.