Oil and Natural Gas Corporation (ONGC), the country’s largest oil producer, on Thursday announced a 5.7 per cent drop in its net profit for the second quarter ended September 30.
Net profit for the second quarter-ended September 30 stood at Rs 4,808 crore, down from Rs 5,098 crore in the same period last fiscal, RS Sharma, chairman and managing director, ONGC, said.
According to top company executives, the fall in net profit was primarily due to a major jump in the company’s outgo on fuel subsidies to Rs 12,663 crore in the second quarter of 2008-09 from Rs 3,799 crore in the same period last year.
“Our gross realisation on crude oil sales in the second quarter was $119.4 per barrel, but after giving a discount of $72.7 per barrel to refiners, our net realisation stood at $46.7 per barrel,” Sharma said.
In the second quarter last year, ONGC’s net realisation was $56.1 per barrel after giving a discount of $22.1 per barrel.
Under the subsidy bearing regime, oil exploration and production companies, including ONGC, Oil India Ltd and GAIL, have to bear one-third of the revenue loss that oil marketing companies Indian Oil, Bharat Petroleum Corporation and Hindustan Petroleum Corporation, BPCL and HPCL suffer on sell of petrol, diesel, LPG and kerosene.