Q1 2027 Oil and Natural Gas Corp Ltd Earnings Call

August 5, 2026

Speaker #2: Welcome to ONGC Limited Q1 FY27 earnings conference call. Please stay connected; your conference will begin shortly. Welcome to ONGC Limited Q1 FY27 earnings conference call.

Speaker #2: Please stay connected. Your conference will begin shortly. Welcome to ONGC Limited Q1 FY27 earnings conference call. Please stay connected. Your conference will begin shortly.

Speaker #2: Welcome to ONGC Limited Q1 FY27 earnings conference call. Please stay connected. Your conference will begin shortly. Welcome to ONGC Limited Q1 FY27 earnings conference call.

Speaker #2: Please stay connected. Your conference will begin shortly. Welcome to ONGC Limited Q1 FY27 earnings conference call. Please stay connected. Your conference will begin shortly.

Speaker #2: Welcome to ONGC Limited Q1 FY27 earnings conference call. Please stay connected. Your conference will begin shortly.

Speaker #4: Your conference is being recorded.

Nitin Tiwari: Your conference is being recorded.

Speaker #5: Ladies and gentlemen, I am Adri, moderator for the conference call. Welcome to ONGC's earnings conference call for the quarter ended 30 June 2026. We have with us today Shri Anupa Agarwal, Director of Finance, and the team, who will interact with investors and analysts to discuss earnings for Q1 of the financial year 2026-27.

Moderator: Good afternoon, ladies and gentlemen. I'm Madhuri, Moderator for the conference call. Welcome to ONGC's Earnings Conference Call for the quarter ended 30 June 2026. We have with us today Shri Anupam Agarwal, Director of Finance, and team, who will interact with investors and analysts to discuss earnings for Q1 FY26 to FY27. As a reminder, all participants will be in listen-only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing star and then zero on your touchtone telephone. Please note, this conference is recorded. I would now like to hand over the floor to Mr. Shri Anupam Agarwal for his opening remarks.

Operator: Good afternoon, ladies and gentlemen. I'm Madhuri, Moderator for the conference call. Welcome to ONGC's Earnings Conference Call for the quarter ended 30 June 2026. We have with us today Shri Anupam Agarwal, Director of Finance, and team, who will interact with investors and analysts to discuss earnings for Q1 FY26 to FY27. As a reminder, all participants will be in listen-only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing star and then zero on your touchtone telephone. Please note, this conference is recorded. I would now like to hand over the floor to Mr. Shri Anupam Agarwal for his opening remarks.

Speaker #5: As a reminder, all participants will be in listen-only mode, and there will be an opportunity for you to ask questions after the presentation concludes.

Speaker #5: Conference call, please signal an operator by pressing star and then zero on your touch-tone telephone. Please note, this conference is recorded. I would now like to hand over the floor to Mr. Sri Anupa Magarwal for his opening remarks.

Speaker #6: Good afternoon, ladies and gentlemen. I'm Anupa Magarwal, Director of Finance at ONGC. I welcome you all to ONGC's earnings conference call for the first quarter of FY26-27.

Anupam Agarwal: Good afternoon, ladies and gentlemen. I'm Anupam Agarwal, Director of Finance, ONGC. I welcome you all to ONGC's earnings conference call for Q1 FY26-FY27. Thank you all for joining us today. I'm joined here by my colleagues from ONGC, Mr. Ajay Kumar Singh, President, Planning and Transformation; Mr. Satish Kumar Dwivedi, Chief JV and BD; Mr. Yogish Nayak, Chief Corporate Finance; Dr. Ravinder Singh Negi, Chief Treasury and Investor Relations; Mr. Sanjay Kumar Sharma and Mr. Prakash Joshi from Investor Relations cells; Mr. Akhilesh Tiwari, Head Corporate Accounts; and Mr. Manish Kumar from Exploration Team. Mr. Mukul Bhatnagar and Mr. DK Agarwal have joined from ONGC Videsh Limited. ONGC's financial results for the quarter ended 30 June 2026 were approved by the board on 4 August 2026 and have already been disseminated to the stock exchanges along with our press release.

Anupam Agarwal: Good afternoon, ladies and gentlemen. I'm Anupam Agarwal, Director of Finance, ONGC. I welcome you all to ONGC's earnings conference call for Q1 FY26-FY27. Thank you all for joining us today. I'm joined here by my colleagues from ONGC, Mr. Ajay Kumar Singh, President, Planning and Transformation; Mr. Satish Kumar Dwivedi, Chief JV & BD; Mr. Yogish Nayak, Chief Corporate Finance; Dr. Ravinder Singh Negi, Chief Treasury and Investor Relations; Mr. Sanjay Kumar Sharma and Mr. Prakash Joshi from Investor Relations cells; Mr. Akhilesh Tiwari, Head Corporate Accounts; and Mr. Manish Kumar from Exploration Team. Mr. Mukul Bhatnagar and Mr. DK Agarwal have joined from ONGC Videsh Limited. ONGC's financial results for the quarter ended 30 June 2026 were approved by the board on 4 August 2026 and have already been disseminated to the stock exchanges along with our press release.

Speaker #6: Thank you all for being here, and my colleagues from ONGC: Mr. Ajay Kumar Singh, President, Planning and Transformation; Mr. Satish Kumar Devi, Chief, JV and BD; Mr. Yogesh Nayak, Chief, Corporate Finance; Dr. Ravindra Singh Nagi, Chief, Treasury and Investor Relations; Mr. Sanjay Kumar Sharma and Mr. Prakash Joshi from Investor Relations Health; Mr. Akhilesh Tiwari, Head, Corporate Accounts; and Mr. Manish Kumar from the Exploration Team.

Speaker #6: Mr. Mukul Bhatt Nagar and Mr. D.K. Agarwal have joined from ONGC Videsh Limited. ONGC's financial results for the quarter ended 30 June 2026 were approved by the board on 4 August 2026 and have already been disseminated through the stock exchanges along with our press release.

Speaker #6: This has also been sent to the analysts who are on our mailing list. The first quarter has been a strong one.

Anupam Agarwal: This has also been seen sent to the analysts who are there on our mailing list. The Q1 has been a strong one for ONGC. The reported standalone growth, INR 746,450 crore, an increase of over 45% over the corresponding quarter of the last year. The standalone profit after tax stood at INR 17,034 crore, registering a robust growth of over 112% year-on-year. This quarter also witnessed the highest ever standalone quarterly profit before tax of INR 22,048 crore. Our average crude price realization has been $99.45 per barrel. Despite inflationary pressures and adverse exchange rate movements, ONGC maintained operating expenditure broadly at the same level as the corresponding quarter of the previous year. This reflects the impact of sustained operational action initiatives and a continued focus on optimizing controllable operating costs across the organization.

Speaker #6: For ONGC, we reported standalone gross revenue of ₹46,460 crore, an increase of over 45% over the corresponding quarter of last year. Standalone profit after tax is ₹21,734 crore, registering a robust growth of over 112% year on year.

Speaker #6: This quarter also witnessed the highest ever standalone quarterly profit before tax of ₹22,048 crore. Our average goods price realization has been $99.45 per barrel.

Speaker #6: Despite inflationary pressures and adverse exchange rate movements, ONGC maintained operating expenditure broadly at the same level as the corresponding quarter of the previous year.

Speaker #6: This reflects the impact of sustained operational efficiency initiatives and a continued focus on optimizing controllable operating costs across the organization. On a consolidated basis, the ONGC Group reported a profit after tax of ₹6,554 crore during the first quarter of FY27.

Anupam Agarwal: On a consolidated basis, the ONGC group reported a profit after tax of INR 6,554 crore during Q1 FY27. While the group's consolidated performance was impacted by HPCL's net loss of INR 21,255 crore, primarily due to underrecoveries on petroleum products following the sharp increase in crude oil prices during the West Asia crisis. This was substantially cushioned by the robust performance of our other subsidiaries, particularly ONGC Videsh and MRPL, underscoring the resilience and diversification of ONGC group. The quarter reflects continued progress across three important transformations that are shaping ONGC's future. Transforming our gas portfolio, transforming our mature offshore assets, and transforming India's deepwater exploration landscape. The first transformation is unfolding through the growing contribution of new well gas. During the quarter, revenue from new well gas reached nearly INR 4,000 crore, generating an incremental realization of about INR

Speaker #6: While the group's consolidated performance was impacted by HPCL's net loss of ₹21,226.5 crore, primarily due to under-recoveries on petroleum products following the sharp increase in crude oil prices during the West Asia crisis, this was substantially cushioned by the robust performance of our other subsidiaries, particularly ONGC Videsh and MRPL, underscoring the resilience and diversification of the ONGC group.

Speaker #6: The quarter reflects continued progress across three important transformations that are shaping ONGC's future: transforming our gas portfolio, transforming our mature offshore assets, and transforming India's deep-water exploration landscape.

Speaker #6: The first transformation is unfolding through the growing contribution of Newell Gas. During the quarter, revenue from Newell Gas reached nearly ₹4,000 crore, generating an incremental realization of about ₹1,900 crore over the administered pricing mechanism.

Anupam Agarwal: 1,900 crore over the administered pricing mechanism. New well gas now contributes approximately 38% of revenue from our nomination gas portfolio, demonstrating the steady migration towards a more remunerating gas basket. The contribution of gas to ONGC's standalone revenue has also increased from around 25% in FY25 to 28% in FY26, as the share of new well gas continues to expand. On the production front, overall oil and gas production during the quarter remained broadly stable. The year-on-year variation was primarily attributable to temporary operational factors including reservoir complexities in KG Deepwater 98/2, pre-commissioning activities associated with major offshore projects, pipeline depletion in Western Offshore, and lower gas offtake from certain isolated fields due to customer site disruptions. Most of these are execution-related challenges rather than structural concerns regarding our asset base.

Speaker #6: Newell Gas now contributes approximately 38% of revenue from our nomination gas portfolio, demonstrating the steady migration towards a more remunerative gas basket. The contribution of gas to ONGC's standalone revenue has also increased from around 25% in FY25 to 28% in FY26, as the share of Newell Gas continues to expand.

Speaker #6: On the production front, overall oil and gas production during the quarter remained broadly stable. The year-on-year variation was primarily attributable to temporary operational factors, including reservoir complexities in KG deepwater 98/2, pre-commissioning activities associated with major offshore projects, pipeline dismantling in Western Offshore, and lower gas offtake from certain isolated fields due to customer-side disruptions.

Speaker #6: Most of these are execution-related challenges rather than structural concerns regarding our asset base. With the progressive commissioning of staggered projects such as the Daman Upside Development Project, expansion of the TSP program, and monetization of DSF, we expect the production trend to progressively improve in the coming quarters.

Anupam Agarwal: With the progressive commissioning of strategic projects such as the Daman Upside Development Project, expansion of TSP program, and monetization of VSS, we expect the production trend to progressively improve in the coming quarters. Our second transformation is centered on renewed thrust in Western Offshore, under which ONGC is implementing one of the largest capital investment programs in the history of its Western Offshore operations, with projects exceeding INR 40,000 crore under various stages of execution. These encompass pipeline replacement, reservoir and pressure management, enhanced water injection, production system upgrades, and several field development initiatives being undertaken. In collaboration with our technical service partner, BP. Encouraged by the positive outcome under the first phase of the partnership in Mumbai High, we have now expanded this model across the entire Western Offshore portfolio.

Speaker #6: Our second transformation is centered on renewed thrust in Western Offshore, under which ONGC is implementing one of the largest capital investment programs in the history of its Western Offshore operations, with projects exceeding ₹40,000 crore under various stages of execution.

Speaker #6: These encompass pipeline replacement, reservoir and pressure management, enhanced water injection, production system upgrades, and several field development initiatives being undertaken. In collaboration with our technical service partner, and as an outcome of the first phase of the partnership in Mumbai High, we have now expanded this model across the entire western offshore portfolio.

Speaker #6: During the quarter, Mumbai High TSP continued showing encouraging results, with oil production reaching around 107% of the contextual baseline production and gas production around 113% of the contextual baseline.

Anupam Agarwal: During the quarter, Mumbai High TSP continued showing encouraging results, with oil production reaching around 107% of contractual baseline production and gas production around 113% of the contractual baseline. The third transformation relates to deepwater exploration, which we believe represents the next major frontier for India's upstream sector. Recent approval by the government of Samudra Manthan, the national offshore exploration scheme with a total outlay of INR 54,084 crore, is a landmark initiative that reflects a decisive national commitment towards unlocking India's deepwater hydrocarbon potential and creating a favorable investment environment for offshore exploration. As India's flagship E&P company, ONGC will play a central role in this national mission. During the quarter, we achieved an important milestone by commencing drilling of our first deepwater exploratory well in the Mahanadi offshore basin under the Samudra Manthan program. We continue to make steady progress in strengthening our green energy portfolio.

Speaker #6: The third transformation relates to deep water exploration, which we believe represents the next major frontier for India's upstream sector. Recent approval by the government of Samudra Mantan, the National Offshore Exploration Scheme, with a total outlay of ₹84,084 crore, is a landmark initiative that reflects a decisive national commitment towards unlocking India's deep water hydrocarbon potential.

Speaker #6: And creating a favorable investment environment for offshore exploration. As India's flagship E&P company, ONGC will play a central role in this national mission. During the quarter, we achieved an important milestone by commencing drilling of our first deepwater exploration well in the Mahanadi offshore basin under the Samudra Mantan program.

Speaker #6: We continue to make steady progress in strengthening our green energy portfolio. Through OGL, our renewable energy portfolio has now reached 2.853 gigawatts, supported by both organic expansion and strategic acquisitions.

Anupam Agarwal: Through OGL, our renewable energy portfolio has now reached 2.853 GW, supported by both organic expansion and strategic acquisitions. ONGC awarded a 300 MW ISTS-connected solar power project for captive consumption last year, and corresponding 250 MW wind power project has been awarded in June 2026. To conclude, our immediate focus is on the successful execution of major production projects and the monetization of new developments and accelerated offshore exploration. With that, I conclude my opening remarks. Thank you.

Speaker #6: ONGC awarded a 300-megawatt ISTS-connected solar power project for captive consumption last year, and a corresponding 250-megawatt wind power project was awarded on June 26.

Speaker #6: To conclude, our immediate focus is on the successful execution of major production projects, timely monetization of new developments, and accelerated offshore exploration. With that, I conclude my opening remarks.

Speaker #6: Thank you.

Speaker #1: Thank you, sir. Ladies and gentlemen, we will now begin the question-and-answer session. If you have a question, please press star and one on your telephone keypad.

Moderator: Thank you, sir. Ladies and gentlemen, we will now begin the question and answer session. If you have a question, please press star and one on your telephone keypad and wait for your turn to ask the question. If you would like to withdraw your request, you may do so by pressing star and one again. Participants are kindly requested to restrict to one question in the initial round and join back the queue for more questions. First question comes from Yogesh Patil from Dolat Capital. Please go ahead.

Operator: Thank you, sir. Ladies and gentlemen, we will now begin the question and answer session. If you have a question, please press star and one on your telephone keypad and wait for your turn to ask the question. If you would like to withdraw your request, you may do so by pressing star and one again. Participants are kindly requested to restrict to one question in the initial round and join back the queue for more questions. First question comes from Yogesh Patil from Dolat Capital. Please go ahead.

Speaker #1: And wait for your turn to ask the question. If you would like to withdraw your request, you may do so by pressing star and one again.

Speaker #1: Participants are kindly requested to restrict themselves to one question in the initial round, and join back in the queue for more questions. The first question comes from Yogesh Patel from Dholak Capital.

Speaker #1: Please go ahead.

Speaker #2: Thanks for taking my question, sir. On the oil production side, if we look at oil production on a sequential basis, nominated field oil production has increased 1% quarter-on-quarter, while the ONGC-operated block NELP is indicating a sharp decline of 8%.

Yogesh Patil: Thanks for taking my question, sir. On oil production side, if we look at the oil production on sequential basis, nominated field oil production has increased 1% Q1Q, while the ONGC-operated block NELP is indicating a sharp decline of 8%. Just wanted to understand the nominated field oil production growth is backed by the TSP program at Western Offshore or is there any reason? That's one. Secondly, wanted to understand on KG 98/2 production, what is the current rate of production there and how it has declined over the last three months? That would be helpful.

Speaker #2: So, I just wanted to understand—is the nominated field oil production growth backed by the TSP program at Western Offshore, or is there any other reason?

Speaker #2: That's one. And secondly, I wanted to understand, on KG-98/2 production, what is the current rate of production there, and how has it declined over the last three months?

Speaker #2: That would be helpful.

Speaker #5: Yes, Yogesh, you are correct. Actually, we have been able to maintain the production. If you look at last year's Q4 production versus the first quarter production, it is almost flat.

Anupam Agarwal: Yes, Yogesh, you are correct. Actually, we have been able to maintain the production vis-a-vis last year. Q4 production versus the Q1 production, it is almost flat. There has been some decline vis-a-vis Q1 of the last year, mainly as I brought out various factors. Regarding the increase, you are talking about the nomination field. Yes, TSP is one of the major factors. Mumbai High is there, and there we have already reached about 107% of our baseline production. Regarding this 98/2, there has been some challenges we have been seeing, and the production of oil is currently around 21,000 barrels per day and gas is around Ajay? 1.5 MMSCMD.

Speaker #5: There has been some decline vis-à-vis Q1 of last year, mainly due to various factors, as I brought out. Regarding the increase we are talking about in the nomination field, yes, TSP is one of the major factors.

Speaker #5: Mumbai High is there, and there we have already reached about 107% of our baseline production. Regarding this 98/2, there have been some challenges.

Speaker #5: We have been seeing, and the production of oil is currently around 21,000 barrels per day. And gas is around—okay.

Speaker #4: 1.5.

Speaker #5: 1.5. MMS, CMB.

Speaker #2: Okay, sir. I just wanted to continue on the same question. As you have already touched on the nominated field side—kind of a natural production decline—how should one look into the FY27 and FY28 nominated field oil production guidance? If you could give us that, it would be helpful for us.

Yogesh Patil: Okay. Sir, just wanted to continue on the same question. As you have arrested on the nominated field side, kind of a production decline, natural production decline. How one should look into the FY27 and FY28 nominated field oil production guidance, if you could give us, it would be helpful for us.

Speaker #5: I would like to give the total standalone production of ONGC for the next year. I see that last year our oil plus gas standalone production, excluding these areas, was in the range of 48.

Anupam Agarwal: I would like to give the total standalone production of ONGC for the next year. I see last year, our oil plus gas standalone production, excluding CDSR, was in the range of 38.87 MMT. This year, we expect to reach about 39 MMT, oil plus gas. The upside will come mainly from gas because many of the projects like DUDP, which is already progressing, and by December, we'll be reaching a 2 MMSCMD gas. This CPP commissioning in the next quarter, 1.3 MMSCMD will come, and Tapti and Daman wells, another 0.5 MMSCMD will come. There will be further upside coming from TSP 1 and 2, both are in place now. Some initial gains we'll see on that side also.

Speaker #5: 38.87 MMT. So this year, we expect to reach about 39 MMT. For oil plus gas, the upside will come mainly from gas, because many of the projects like DUDP are already progressing. By December, we'll be reaching 2 MMSCM/D of gas with this CPP commissioning in Scope 1. 1.3 MMSCM/D will come.

Speaker #5: And TAPI and Daman wells, another 0.5 MMSCMD will come. There will be further upside coming from TSP 1 and 2; both are in place now.

Speaker #5: Some initial gains we'll see on that side also.

Speaker #2: Lastly, sir, if you could add—Yogesh, just to add—sir was saying this 2 MMS, 2 MMS CMB would be over and above the one which we are currently producing from DUDP.

Yogesh Patil: Lastly, sir, if we-

Anupam Agarwal: Just to add.

Yogesh Patil: Yeah.

Anupam Agarwal: Sir was saying the 2 MMSCMD would be over and above 1, which we are currently producing from DUDP. That means.

Speaker #2: That means, by the third quarter, it will be 3 MMS CMB.

Yogesh Patil: It will be around 3 MMSCMD.

Anupam Agarwal: By Q3, it will be 3 MMSCMD. We see about 1 BCM gas per year from the new developments, which I am talking about. That is for the current year. Next year, another overall almost 1 MMTOE of oil and gas gain will be there for 2027, 2028.

Speaker #5: So we see about 1 BCM of gas per year from the new developments that I am talking about. That is for the current year, and next year overall, almost 1 MMT OE of oil and gas gain will be there for 2027–28.

Speaker #2: Okay, sir. Lastly, just to break it down in simpler fashion, can you give us guidance for oil production for FY27 and FY28, and gas production for FY27 and FY28?

Yogesh Patil: Okay, Sir. Lastly, just to break it down in a simpler fashion, can you give us a guidance for oil production for FY27 and FY28, and gas production for FY27 and FY28, if you have any numbers?

Speaker #2: If you have any ND numbers.

Speaker #5: You see, I had mentioned about 39 MMT for the current year, and 40 MMT for the next year, oil and gas taken together. So backup will be about—

Anupam Agarwal: I had told about 39 MMT for the current year and 40 MMT for the next year, oil and gas taken together.

Speaker #2: So, I think it would be 50-50.

Yogesh Patil: I think it will be 50/50.

Speaker #5: 50-50 you can consider.

Anupam Agarwal: 50/50 we can consider next year. Oil and gas, both.

Speaker #2: In next year, oil and—oh, okay, sir. That's really helpful. Thanks. I will come back in a few.

Yogesh Patil: Okay, sir. That's really helpful. Thanks. I'll come back in a bit.

Speaker #5: Yes, yes.

Anupam Agarwal: Yes, sir.

Speaker #1: Thank you, sir. The next question comes from Nitin Tiwari from Philips Capital. Please go ahead.

Moderator: Thank you, sir. The next question comes from Nitin Tiwari from PhillipCapital. Please go ahead.

Operator: Thank you, sir. The next question comes from Nitin Tiwari from PhillipCapital. Please go ahead.

Speaker #2: Hi, sir. Good evening. Thanks for the opportunity. Congratulations on a very good set of numbers this quarter. Sir, my question actually was related to one of the items which was mentioned in the notes to your accounts.

Nitin Tiwari: Hi, sir. Good evening. Thanks for the opportunity. Congratulations on very good set of numbers in this quarter. Sir, my question actually was related to one of the items which you mentioned in the notes to your accounts. This is related to the Panna Mukta Tapti arbitration which is going on. Apparently, the liability which is sitting in your contingent liabilities are significantly about INR 15,000 to 16,000 crore, which is almost like, could be considered to be a quarter of your operating profit as well. My question with respect to that is that, was the communication which was sent by ministry, was that taken as a binding directive or, the decision was also evaluated on basis of independent legal advice, that ONGC is willing to participate in this arbitration.

Speaker #2: This is related to the Panna Mukta TAPI arbitration which is going on. So apparently the liability which is sitting in your contingent liability is a significant one, about 15 to 16,000 crores, which is almost like in I mean, could be considered to be a quarter of your operating profit as well.

Speaker #2: So, my question with respect to that is: Was the communication which was sent by the Ministry taken as a binding directive, or was the decision also evaluated on the basis of independent legal advice?

Speaker #2: That ONGC is not going to participate in this arbitration. And given that you have not participated as a claimant, have you, like, you know, in a way tacitly accepted the demand which is made by the and that backdrop, I mean, like, you know, I'm just what I'm trying to get at is that how have you ensured that your own economic interests are protected and also that of your monolithic shareholders' economic interests are protected?

Nitin Tiwari: Given that you have not participated as a claimant, have you, in a way, tacitly accepted the demand that is made by government. That backdrop, what I'm trying to get at is that how have you ensured that your own economic interests are protected, and also that of your minority shareholders' economic interests are protected given that you are not participating in this arbitration?

Speaker #2: Given that you are not participating in this arbitration.

Speaker #5: Good. This is a good question. You know, ONGC is an arm of the Government of India, so we go by the government directive. But at the same time, we try to ensure our economic interests are protected.

Anupam Agarwal: This is a good question. You know, ONGC is an arm of government in India. We go by the government directive, but at the same time, we try to ensure our economic interests are protected. In this case, what government has given directive. When we discussed with the government, there is no formal directive. It is a kind of understanding, that we should not be going for this arbitration against the government, or two arms of government fighting with each other. It is not good. What was decided in that discussion was that let the other party continue to be in this case, and whatsoever decision will be there, that will be applicable for ONGC. Our interest is also protected, and we are not in dispute with the government in the court. That is the way.

Speaker #5: So, in this case, what government has given the directive? The government—when we discuss with the government, there is no formal directive. It is a kind of understanding.

Speaker #5: But we should not be going for this arbitration against the government. The government—two arms of the government fighting with each other—it is not good.

Speaker #5: So what was decided in that discussion was that let the other party continue to be in this case, and whatever the decision will be, that will be applicable for ONGC.

Speaker #5: So our interest is also protected, and we are not in dispute with the government in the court. So that is the way. So, I don't see there is any loss to the interest of any shareholder. Whatever decision will be there, that will be applicable to us.

Anupam Agarwal: I don't see there is any loss to the interest of any shareholder. Whatsoever decision will be there, that will be applicable to us.

Speaker #2: Sir, is this an outcome of your discussion with the government, or was this basically an outcome of your discussion with the court? Because tomorrow, the court might decide something else—for example, that only arbitrated parties would get their benefit, and that the party which has not arbitrated and has accepted the demand in their court is not liable to get any benefits out of this arbitration.

Nitin Tiwari: This is an outcome of your discussion with government, or was this an outcome of your basically discussion with the court? Because court tomorrow might decide something else, that only arbitrated parties would get the benefit, and the party which has not arbitrated has accepted the demand and therefore is not liable to get any benefits out of this arbitration. I mean, that route courts could have also taken it, and given this is your own internal understanding. Is that the right read over here?

Speaker #2: I mean, that's the route the court could also take, right? I mean, given this is your own internal understanding. Is that the right read over here?

Speaker #5: No, I would just like to say, it is a joint venture case where both parties are partners. So, it is not one party's case versus the other party.

Anupam Agarwal: No. I will just like to say, it is a joint venture case where both parties are the partners. It is not one party case versus other party, it is the joint venture versus the government. One party of the joint venture has gone in the court. Whatsoever decision will be there, that will be applicable across. That is the understanding, and that is the understanding of government also.

Speaker #5: It is the joint venture versus the government. One party of the joint venture has gone to court. Whatever decision is there, that will be applicable across.

Speaker #5: That is the understanding. And that is also the case.

Speaker #2: Okay, so basically the outcome would be applicable to the JV consortium and not only to the parties arbitrating.

Nitin Tiwari: Okay. Basically, the outcome would be applicable to the JV consortium and not only to the parties arbitrating.

Speaker #5: Yes, that is the normal principle of JV operations.

Anupam Agarwal: Yeah. That is the normal principles of JV operations.

Speaker #2: Got it. Okay. Okay. Thank you. Thank you, sir.

Nitin Tiwari: Got it. Okay. Thank you, sir.

Speaker #1: Thank you, sir. Next question comes from Mayank Maheshwari from Morgan Stanley. Please go ahead, sir.

Moderator: Thank you, sir. Next question comes from Mayank Maheshwari from Morgan Stanley. Please go ahead, sir.

Operator: Thank you, sir. Next question comes from Mayank Maheshwari from Morgan Stanley. Please go ahead, sir.

Speaker #2: Sir, I had a question regarding what you mentioned about the upside risk in exploration, due to the government incentives provided around this program.

Mayank Maheshwari: Sir, I had a question around what you talked about around the upside risk on exploration because of the government incentives that are being given around this Samudra Manthan program. Can you kind of talk us through in terms of the role ONGC will play in this? Because in the past five to seven years, you're not really seeing too much of high risk, ultra-deep water exploration drilling coming through on ONGC. A connected question around that is the challenges that you started to face on KG. What are they and how are you kind of thinking about it in terms of resolving it as well?

Speaker #2: Can you kind of talk us through in terms of the role ONGC will play in this? Because in the past five to seven years, you've not really seen too much of high-risk ultra deep water exploration drilling coming through on ONGC and a connected question around that is the challenges that you started to face on KG.

Speaker #2: What are they, and how are you kind of thinking about it in terms of resolving it as well?

Speaker #5: Mayank, that is a very good question. And obviously, it is anticipated that somebody would ask about this. So, being a national oil company, we will be playing a major role in this project.

Anupam Agarwal: Mayank, it is a very good question, obviously it is anticipated also, somebody talking about Samudra Manthan. Being national oil company, we will be playing the major role in this project. Your question is last four or five years, we have not done some major deep water exploration activities. It is not correct. We have been continuously carrying out exploration, about 100 wells we do, and last year also we drilled about four deepwater exploratory wells. This year also, one stratigraphic well we have already drilled, another well we have started. This is basically recognition by the government as well as by ONGC post-Hormuz, the kind of need of energy security for the country. Government is very conscious that energy security is very, very important, and for that, whatever is required to be done, that will be done.

Speaker #5: So your question is, in the last four or five years, we have not done any major deep-water exploration activities. That is not correct. We have been continuously carrying out exploration—about 100 wells we do.

Speaker #5: And last year also, we drilled about four deepwater exploratory wells. This year also, one stratigraphic well we have already drilled, and another well.

Speaker #5: We have started. And this is basically recognition by the government as well as by ONGC, post hormones, the kind of energy need — of energy security — for the country.

Speaker #5: So, the government is very conscious that energy security is very, very important, and for that, whatsoever is required to be done, that will be done.

Speaker #5: You would have also seen many of the initiatives which the government has taken in recent years, like fiscal stability, and the kind of new benefits they have given in the Island Gas Act.

Anupam Agarwal: You would have also seen many of the initiatives which government has taken in the recent years, like fiscal stability, they have given the kind of new benefits they have given in the Oil and Gas Act and new gas pricing. All that incentives have made a lot of difference in the process. Further, with the kind of prices we are seeing, before Hormuz, the general consensus was coming that oil prices will settle down around $65. Now with this Hormuz crisis, there's a security layer which is coming on the baseline, and we believe it will be $75 plus in the long run. That is our expectation. With that, many of the fields which we thought might not be viable are working out in the range where they are viable, and we will like to develop them for the energy security for the country.

Speaker #5: And new gas pricing, all those incentives have made a lot of difference in the process. Further, with the kind of prices we are seeing, before, the general consensus was that oil prices would settle down around $65.

Speaker #5: But now, with this hormones crisis, there is a security layer which is coming on the baseline, and we believe it will be $75 plus in the long run.

Speaker #5: So that is our expectation. With that, many of the fields which we thought might not be viable are working out in the range where they are viable, and we would like to develop them further.

Speaker #5: Energy security for the country. The same is the case for deep water. Because at $65 or $60, you see, many of the deep water projects are a high-risk, high-reward game.

Anupam Agarwal: Same is the case for deepwater, because at $65 or $60, you see many of the Deepwater is a high risk, high reward game, and the size of reservoir, the economics has to be good to develop that. Maybe some of the fields might not have been good at $60, $65 to explore, but at $75 plus kind of thing, that will be continuing to be very, very lucrative also and important for energy security. We are committed for this deepwater mission of the Government of India, and this is first time in the history of oil and gas that government has allocated INR 84,000 crore fund from its own kitty for this new oil and gas exploration. As national oil company, we remain committed, we will do.

Speaker #5: And the size of the reservoir, the economic size needs to be good to develop that. So maybe some of the fields might not have been good to explore at $60–$65.

Speaker #5: But at $75-plus kind of thing, that will continue to be very, very lucrative also, and important for energy security. So, we are committed to this deepwater mission of the Government of India.

Speaker #5: And this is the first time in the history of oil and gas that the government has allocated ₹84,000 crore from its own kitty for new oil and gas exploration.

Speaker #5: So, as a national oil company, we remain committed. We will do so. And because a major part of this is being funded by the Government of India, it does not have any major financial impact for the company.

Anupam Agarwal: Because a major part of this is being funded by the Government of India, it does not have any major financial impact for the company. At the same time, it gives an upside in terms of a new resource we find and new oil and gas development activities we undertake. I hope I could clarify you.

Speaker #5: But at the same time, it gives us an upside in terms of new resources we find and new oil and gas development activities we undertake.

Speaker #5: I hope I was able to clarify things for you.

Speaker #2: Yes, sir. I think just a follow-up around this was, sir, how does this incentive of close to around $9 billion that the government has given help you lower your break-even cost to kind of develop any project on the ultra-deepwater or deepwater side?

Mayank Maheshwari: Yes, sir. I think just a follow-up around this was, how does this incentives of close to around INR 9 billion that the government has given help you lower your break-even cost to kind of develop any project on the ultra-deepwater or deepwater side? If you can also give us a bit of a sense of which are the more prospective basins apart from Andaman, obviously, which is, I think you have been drilling. I think you can see in the country where you see prospects for ultra-deepwater and deepwater come through.

Speaker #2: And if you can also give us a bit of a sense of which are the more prospective basins, apart from Andaman—obviously, which is, I think, you have been drilling.

Speaker #2: I think you can see in the country where you see prospects for ultra-deepwater and deepwater come through.

Speaker #5: Again, you see this deepwater mission the government has announced is the first phase of that, which is applicable up to 2031. And that is mainly the exploratory phase.

Anupam Agarwal: You see this deepwater mission the government has announced is the first phase of that, which is applicable up to 2031, that is mainly the exploratory phase. The next phase will trigger beyond 2031, once this phase results will be known. You know, each deepwater well costs about INR 1,000 crore. We do not know how much Government of India will fund on that, and how it will fund. Those details are still being worked out and will be shared in due course. Whatsoever the support will be coming, it will be reducing our cost of exploration, and obviously with that, the economics of the project will be better. If exploratory cost is lower, my economics will be better, and we will see how it will help us in economics at the feasibility stage when the substantial amount of oil and gas reserves are found.

Speaker #5: The next phase will be triggered after '31, once the results of this phase are known. You know, each deepwater well costs about ₹1,000 crore. We do not know how much the Government of India will fund for that.

Speaker #5: And how it will be funded—those details are still being worked out and will be shared in due course. But what other support will be coming?

Speaker #5: It will be reducing our cost of exploration. And obviously, with that, the economics of the project will be better. If exploratory cost is lower, my economics will be better.

Speaker #5: And we will see how it will help us in economics at the feasibility stage, when a substantial amount of oil and gas reserves are found.

Speaker #5: And regarding the area basins, Andaman, you already mentioned. Mahanadi is another one where we have already studied well. And this is the same basin where we had made earlier discoveries, Konark and one more we had made.

Anupam Agarwal: Regarding the area basins, Andaman, you already told. Mahanadi is one where we have already spudded well, this is the same basin where we had made earlier discoveries, Konark and one more we had made. That is one. Then we are also working in Kaveri. Kaveri is also one area where we will be doing something. We are also going to participate in OALP 10 in a big way, lot of blocks are on offer in deepwater, we will decide which areas in those basins we will drill.

Speaker #5: So that is one. And then we are also working in Kaveri. Kaveri is also one area where we will be doing something. And we are also going to participate in OLAP-10 in a big way.

Speaker #5: And a lot of blocks are on offer in deep water. We will decide which areas in those basins we will drill.

Speaker #2: And will it be in partnership with global majors, or do you want to kind of do it standalone?

Mayank Maheshwari: Will it be in partnership with global majors, or you want to kind of do it standalone?

Speaker #5: You see, deep water is high risk, high reward. Our internal preference is that wherever international partners want to come and join with us, they are welcome.

Anupam Agarwal: You see, deepwater is a high risk, high reward. Our internal preference is wherever international partners want to come and join with us, they are welcome. We keep on inviting them, discussing with them, we believe with this, the kind of incentives which Government of India has given and their major concern was fiscal stability. That is already assured by the Government of India. Some of the global majors will come. In past also, in one of the block, we had bid with BP and Reliance together. In next round also, wherever we find the global partners are interested, we will take them along for this deepwater mission of the Government of India.

Speaker #5: We keep on inviting them, discussing with them. And we believe that, with the kind of incentives which the Government of India has given, and considering that their major concern was fiscal stability…

Speaker #5: So that is already assured by the Government of India. Some of the global majors have come in the past also in one of the blocks.

Speaker #5: We had bid with BP and Reliance together. In the next round also, wherever we find that global partners are interested, we will take them along for this deepwater mission of the Government of India.

Speaker #2: Thank you.

Mayank Maheshwari: Thank you.

Speaker #4: Thank you, sir. The next question comes from Vivek Anand from Ambit Capital. Please go ahead.

Moderator: Thank you, sir. The next question comes from Vivek Subbaraman from Ambit Capital. Please go ahead.

Operator: Thank you, sir. The next question comes from Vivekanand Subbaraman from Ambit Capital. Please go ahead.

Speaker #5: Yeah, thank you for the opportunity. I have two questions. The first one is on the operational challenges that you are facing, which have led to production issues.

Vivek Subbaraman: Yeah. Thank you for the opportunity. I have two questions. The first one is on the operational challenges that you are facing, which has led to production issues. Thanks for the opening address. Just to, if you could elaborate on the execution milestones that you have now to improve or, let's say, debottleneck these fields so that the operational issues are resolved, let's say, by Q3. That would be great. Secondly, did I hear it correctly that the results of the first TSP are that you are 7% higher than the baseline production? In an absolute sense, if you could help us understand the results of the TSP-1 areas that you have covered with BP. If you can give us a sense of what the production was before the partnership and what is it right now. Maybe if you give the absolute numbers, it will be more helpful.

Vivekanand Subbaraman: Yeah. Thank you for the opportunity. I have two questions. The first one is on the operational challenges that you are facing, which has led to production issues. Thanks for the opening address. Just to, if you could elaborate on the execution milestones that you have now to improve or, let's say, debottleneck these fields so that the operational issues are resolved, let's say, by Q3. That would be great. Secondly, did I hear it correctly that the results of the first TSP are that you are 7% higher than the baseline production? In an absolute sense, if you could help us understand the results of the TSP-1 areas that you have covered with BP. If you can give us a sense of what the production was before the partnership and what is it right now. Maybe if you give the absolute numbers, it will be more helpful.

Speaker #5: So thanks for the opening address. Just to, if you could elaborate on the execution milestones that you have now to improve or, let's say, de-bottleneck these fields so that the operational issues are resolved, let's say, by 3Q.

Speaker #5: That would be great. And secondly, did I hear correctly that the ESP results of the first TSP show that you are 7% higher than the baseline production?

Speaker #5: So, in an absolute sense, if you could help us understand the results of the TSP 1 areas that you covered with VP, if you can give us a sense of what the production was before the partnership and what it is right now.

Speaker #5: Maybe if you give the absolute numbers, it will be more helpful. Thank you very much. So, I will take the second question first regarding the TSP. Yes, TSP-1 was from the Mumbai High field.

Vivek Subbaraman: Thank you very much.

Vivekanand Subbaraman: Thank you very much.

Anupam Agarwal: I will take the second question first regarding the TSP. Yes, TSP-1 was from Mumbai High Field. Mumbai High, when we talk about the gain, is against the baseline. You know, general oil and gas sector, the fields have a natural decline rate, and that is about 5% to 6%. Over that, we see the increase. 7% is coming over the natural decline rate of 6% to 7%. Overall absolute term, the increase will be about 1% to 2% for Mumbai High. Gas is about 12% to 13%. There it is about 5% to 6%. There, you would have heard in last investor call by our CMD. He mentioned one thing, that is, ONGC is gradually moving from an oil base to a gas base. That is the story. That happened in the past because the gas prices were not remunerative.

Speaker #5: So, Mumbai High—when we talk about the gain, it is against the baseline. As you know, in the general oil and gas sector, the fields have a natural decline rate.

Speaker #5: And that is about 5 to 6%. Over that, we see the increase. So 7% is coming over the natural decline rate of 6 to 7%.

Speaker #5: So, overall, in absolute terms, the increase will be about 1% to 2% for Mumbai High. For gas, it is about 12% to 13%. So, there it is about 5% to 6%.

Speaker #5: And there, you would have heard in the last investor call by our CMD, he mentioned one thing, that is, when this is gradually moving from an oil-based to a gas-based.

Speaker #5: So, and that is the story that happened in the past. Because the gas prices were not remunerative, many of the fields which were discovered were not remunerative.

Anupam Agarwal: Many of the fields which were discovered, they were not remunerative. We were not able to develop. With the prices we are having today, the new gas prices, many of those fields have become commercially feasible, and we are developing them. That is how we are seeing that INR 40,000 crore worth of the projects are already under execution in Western Offshore. Many more projects we are undertaking. Those are under discussion at the board level, and you will get to know in days to come. Regarding operational challenges, when you talk 98/2, it is more than operational. It is basically some reservoir-related challenges. We have seen certain surprises are there. We are getting it studied from the technical experts, and based on that, we will be taking further decision. As far as Western Offshore is concerned, that continues to be the flagship for ONGC group.

Speaker #5: We were not able to develop. With the prices we are having today, the new gas prices, many of those fields have become commercially feasible.

Speaker #5: And we are developing them. And that is how we are seeing that ₹40,000 crore worth of projects are already under execution in the Western Offshore.

Speaker #5: Many more projects we are undertaking. Those are under discussion at the board level. And you will get to know in days to come. Regarding operational challenges, when you talk 98.2, it is more than operational.

Speaker #5: It is basically that some reservoir-related challenges are there. We have seen certain surprises. We are getting it studied by the technical experts, and based on that, we will be taking further decisions.

Speaker #5: But as far as Western Offshore is concerned, that continues to be the flagship for the ONGC group. And there, many projects we have brought in.

Anupam Agarwal: There are many projects we have got in. Last quarter, operational challenge was mainly pre-monsoon swell that impacted some of the offshore installation of platforms, and also a lot of activities was going on. During that process, you have to close certain wells because you cannot continue with the production from the brownfield development projects when we are doing the job on the same platform. Those challenges are there, but we believe post-monsoon, we'll be able to make up all that, and by the end of the year, we will see that production of oil will be almost the level of the last year, and gas will be higher by about 1 BCM.

Speaker #5: Last quarter, the main operational challenge was three monsoon swells that impacted some of the offshore installation platforms. Also, a lot of activities were going on.

Speaker #5: So, during that process, we had to close certain wells because we cannot continue with production from the ground field development projects when we are doing the job on the same platform.

Speaker #5: So, those challenges are there, but we believe that post-monsoon we will be able to make up for all that. And by the end of the year, we will see that production of oil will be almost at the level of last year.

Speaker #5: And gas will be higher by about one BCM. Okay, that's very helpful. Just two follow-ups. So, how many wells are currently operational in AGDW and 98/2 for oil and for gas?

Vivek Subbaraman: Okay. That's very helpful. Just two follow-ups. How many wells are currently operational in KGDWN 98/2 for oil and for gas? That's one follow-up. The second one is the rest of Western Offshore, the new TSP contract that you have signed. Are you saying that because you have now transitioned to a new TSP contract, the wells that were closed will be reopened and the production recovery hinges on your work with BP in the Western Offshore region?

Vivekanand Subbaraman: Okay. That's very helpful. Just two follow-ups. How many wells are currently operational in KGDWN 98/2 for oil and for gas? That's one follow-up. The second one is the rest of Western Offshore, the new TSP contract that you have signed. Are you saying that because you have now transitioned to a new TSP contract, the wells that were closed will be reopened and the production recovery hinges on your work with BP in the Western Offshore region?

Speaker #5: That's one follow-up. And the second one is regarding the rest of Western Offshore, the new TSP contract that you have signed. Are you saying that because you have now transitioned to a new TSP contract, the wells that were closed will be reopened, and the production recovery hinges on your work with BP in the Western Offshore region?

Speaker #5: I will take the second question first, and for the first question, I will hand over to our President Planning. Regarding the closure of wells during execution of the projects, that is a normal phenomenon.

Anupam Agarwal: I will take the second question first, and the first question I will hand over to our President Planning. Regarding the closure of well during execution of the projects, that is a normal phenomenon. It doesn't have to do anything with TSP or anything. It is a normal phenomenon. When you go install new platform, you connect those platforms, some of the activity has to be temporarily stopped. That is a natural phenomenon. It will clear on its own. Yes, TSP is helping us in how to develop some of the projects. They are trying to help us to decide the extraction schedule, what kind of platforms we should produce, how to optimize the surface facilities. All those benefits we are taking. I will now hand over to Mr. Ajay Kumar Singh to give answer to your first question.

Speaker #5: It doesn't have anything to do with TSP or anything. It's a normal phenomenon—when you go to install a new platform, you connect those platforms.

Speaker #5: Some of the activity has to be temporarily stopped, so that is a natural phenomenon. It will clear on its own. Yes, TSP is helping us in how to develop some of the projects. They are trying to help us decide the extraction strategy, what kind of platforms we should produce, and how to optimize the surface facilities.

Speaker #5: So, all those benefits we are taking. I will now hand over to Mr. Ajay Kumar Singh to give the answer to your first question.

Speaker #2: Yeah. Good afternoon. I am Ajay Singh, President – Planning and Transformation, with a question related to 98.2 oil. How many oil wells have we opened? We have opened all the 13 wells.

Ajay Kumar Singh: Yeah. Good afternoon. I am Ajay Singh, President, Planning and Transformation. The question related to 98/2, oil, how many oil wells we have opened. We opened all the 13 wells, and it is being produced. Gas wells, out of 7 wells, 2 already being produced, and 3 is yet to be opened. Once the CPP is commissioned, which is in progress, and we are planning to connect with the subsea wells and control system is going to be commissioned shortly. We will start production from gas wells also. That is likely to start somewhere in the month of October, November. Hope I answered your question.

Speaker #2: And it is being produced in gas wells out of seven wells. And three are to be opened. Once the CPP is commissioned, which is in progress, we are planning to connect with the subsea wells, and the control system is going to be commissioned shortly.

Speaker #2: We will start production from gas wells also. That is likely to start somewhere in the month of October or November. Hope I answered your questions.

Speaker #5: Sure. Lastly, if you could help us with your peak production guideline for KGDW and 98/2, if possible to share on the gas side. Oil, I understand you are challenged.

Vivek Subbaraman: Sure. Lastly, if you could help us with your peak production guidance for KGDWN 98/2, if possible to share on the gas side. Oil, I understand your challenge.

Vivekanand Subbaraman: Sure. Lastly, if you could help us with your peak production guidance for KGDWN 98/2, if possible to share on the gas side. Oil, I understand your challenge.

Ajay Kumar Singh: Presently, we are producing there about 1.5 to 1.7 million metric cube per day. With opening of balance three wells, we expect additional 1.5 MMSCFD. All put together, it will be 3 million plus gas will be produced.

Speaker #2: At present, we are producing there about 1.5 to 1.7 million cubic meters per day. And with opening our balance three wells, we expect an additional 1.5 MMSCMD.

Speaker #2: So, all put together, it will be 3 million plus; gas will be produced.

Speaker #5: Right. And by when do you reach this peak—three million?

Vivek Subbaraman: Right. By when do you reach this peak, 3 million?

Vivekanand Subbaraman: Right. By when do you reach this peak, 3 million?

Speaker #2: By Q4.

Anupam Agarwal: By Q4.

Speaker #5: Okay, thank you very much, and all the very best.

Vivek Subbaraman: Okay. Thank you very much, and all the very best.

Vivekanand Subbaraman: Okay. Thank you very much, and all the very best.

Speaker #4: Thank you, sir. And participants are kindly requested to restrict themselves to one question in the initial round and join back for more questions.

Moderator: Thank you, sir. Participants are kindly requested to restrict with one question in the initial round and join back the queue for more questions. Next question comes from Sabri Hazarika from Emkay Global. Please go ahead.

Operator: Thank you, sir. Participants are kindly requested to restrict with one question in the initial round and join back the queue for more questions. Next question comes from Sabri Hazarika from Emkay Global. Please go ahead.

Speaker #4: Next question comes from Sabri Hazarika from MK Global. Please go ahead.

Speaker #3: Yeah. Good afternoon, and congratulations on the good numbers. So, I have two questions, both relating to OVL. The first question is: I just wanted a roundup on the status of various assets of OVL, including Mozambique, the status of Sakhalin, Venezuela, and Brazil.

Sabri Hazarika: Yeah. Good afternoon, and congratulations on good numbers. I have two questions, but relating to OVL. The first question is, I just wanted a roundup on the status of various assets of OVL, including Mozambique, the status of Sakhalin, Venezuela, and Brazil. A roundup on that, I'll come to the next question.

Speaker #3: So, a roundup on that. Then I'll come to the next question.

Speaker #5: So, Sanjay, I think OVL, you know, was passing through a rough patch for the last four years post-Ukraine crisis. And the Sakhalin asset, which was the most important asset of the OVL group, was not with us for about four years.

Anupam Agarwal: Sanjeev, I think OVL was passing through a rough patch for last four years, post-Ukraine crisis. The Sakhalin asset, which was the most important asset of OVL Group, was not with us for about four years because the government of Russia had taken over the asset and converted into an incorporated entity. Earlier it was an unincorporated entity. Last year, sometime in November, December, we were able to take it back after meeting certain condition precedents. I hope you are aware, so I will not go into details for that.

Speaker #5: Because the government of Russia had taken over the asset and converted it into an incorporated entity. Earlier, it was an unincorporated entity. Last year, sometime in November-December, we were able to take it back after meeting certain condition precedents.

Speaker #5: I hope you are aware, so I will not go into details for that. So that is one thing. And with Sakhalin back in our portfolio, OVL is back in a robust profit scenario.

Sabri Hazarika: Yes.

Anupam Agarwal: That is one thing. With Sakhalin back in our portfolio, OVL is back in the robust profit scenario. Last quarter, again, above INR 1,000 crore. They made this quarter again INR 1,000 crore. You see the OVL, which was giving annually about INR 500 to 600 crore per annum. Now it is INR 1,000 crore per quarter, which is coming from Sakhalin mainly. Some flip coming from the high prices. Mozambique again is a positive. It was in force majeure last year. About August or September, this force majeure was lifted. The activities are going on in full swing, and now we expect sometime in end of 2028 or beginning of 2029, the production will start from the Mozambique project. This is again a very important project from the national security perspective also. Gas, we will have a share of about 3 MMT from that project.

Speaker #5: So, last quarter again, about ₹1,000 crore they made. This quarter, again ₹1,000 crore. So you see, the OVL, which was giving annually about ₹500 to ₹600 crore per annum, now it is ₹1,000 crore per quarter, which is coming from Sakhalin mainly.

Speaker #5: And some slippage coming from the high prices. Mozambique, again, is a positive. It was an enforced measure. Last year, around August or September, this forced measure was lifted.

Speaker #5: The activities are going on in full swing, and now we expect that sometime at the end of 2028 or the beginning of 2029, production will start from the Mozambique project.

Speaker #5: This is again a very important project from the national security perspective also. And gas, we will have a share of about 3 MMSCMD from that project.

Speaker #5: And that is just an initial phase. There are additional phases which will be coming under this Mozambique project. In Brazil, the BMC-4 project is there, where we are a partner with Petrobras.

Anupam Agarwal: That is just the initial phase. There are additional phases which will be coming under this Mozambique project. Brazil BM-SEAL-4 project is there, where we are partnered with Petrobras, and that project is also going on well. The work for FPSO has already been awarded, and we expect the first oil starting from 2030. Venezuela is another evolving story, and you might be aware that we recently managed to get OFAC license. Now we have full freedom to work on Venezuela project, because earlier we were restricting our operations there because of the sanction-related risk. Those risks are behind us. The government of Venezuela has already enacted the new petroleum law. In that they are giving some additional fiscal incentives for development of the resources. ONGC team is already in touch with the Venezuelan authorities in association with our JV partner.

Speaker #5: And that project is also going on well. And the work for SPSO has already been awarded. We expect first oil starting from 2030.

Speaker #5: So, Venezuela is another evolving story. And you might be aware that we recently managed to get an OPEC license. So, now we have full freedom to work on the Venezuela project, because earlier we were restricting our operations there due to sanction-related risks.

Speaker #5: So those risks are behind us. The government of Venezuela has already enacted the new petroleum law. In that, they are giving some additional fiscal incentives for development of the resources.

Speaker #5: The NGC team is already in touch with the Venezuelan authorities, in association with our JV partners. We are involved in two projects there: PERSA and PETROCARABO.

Anupam Agarwal: We are there in 2 projects, Perla and PetroBoscan. Venezuela is the place where largest oil and gas reserves are found. It is the number 1 in terms of reserves, not the Saudi Arabia. It is a focus area for ONGC. All these projects are shallow depth onshore projects where ONGC has full expertise. The kind of projects we produce from in Mehsana and Ahmedabad, that kind of region, places there. We are very upbeat for Venezuela, and we believe very soon we will see some positive development, the new agreement signed and we taking over the operatorship for some of those projects from PDVSA.

Speaker #5: And Venezuela, you know, is the place where the largest oil and gas reserves are found. It is number one in terms of reserves, not the Saudi area.

Speaker #5: So, it is a focus area for ONGC. All these projects are shallow-depth onshore projects, where ONGC has full expertise. The kinds of projects we produce from in Mehsana and Ahmedabad, that kind of regime is present there.

Speaker #5: So we are very upbeat on Venezuela. And we believe very soon we will see some positive developments, the new agreement signed, and we are taking over the operatorship for some of those projects from the DBSA.

Speaker #3: Got it, sir. Thank you so much for the explanation. Just a small follow-up: so your OVL PET, excluding impairment, was ₹2,260 crore in Q4.

Sabri Hazarika: Got it, sir. Thank you so much for the explanation. Just a small follow-up. Your OVL PAT excluding impairment was INR 2,260 crore in Q4. Now it has come down to INR 1,140 crore despite oil prices going up. I've seen the revenue has gone up, but I think equity profit share, that number has gone down. Can you just give us some clarity on how the accounting is happening here and why we are not seeing the benefit of oil prices? When exactly was Sakhalin accounted back into the accounts? That's all. Thanks.

Speaker #3: Now it has come down to ₹1,140 crore, despite oil prices going up. So I've seen that revenue has gone up, but I think the equity profit share—that number has gone down.

Speaker #3: So can you just give us some clarity on how the accounting is happening here, and why we are not seeing the benefit of oil prices?

Speaker #3: And when exactly was Sakhalin accounted back into the accounts? That's all. Thanks.

Anupam Agarwal: Got it. OVL is not one single project, single field. It is a mix of multiple fields in multiple countries. Each country has its own fiscal regime, and each fiscal country has its own geopolitical situation. First you talked about Sakhalin. Sakhalin we could get back in December, and we started accounting for in our profit and loss from January 2026. That is the first. The second thing is this quarter there was some surprise you are talking about is mainly our realization from Russian assets were not as good as they should have been. Because of the kind of geopolitical situation is happening. Russian assets, the realization, it was not at the same level because of the price cap related concern.

Speaker #5: Very good. OVL is not a single project or single field. It is a mix of multiple fields in multiple countries. Each country has its own risk.

Speaker #5: And each fiscal country has its own geopolitical situation. So first, you talked about Sakhalin. Sakhalin we could get back in December, and we started accounting for it in our profit and loss from January 2026.

Speaker #5: So that is the first. The second thing is, this quarter, there was some surprise you are talking about—mainly, our realizations from Russian assets were not as good as they should have been.

Speaker #5: So, you know, because of the kind of geopolitical situation that is happening, Russian assets—the realization was not at the same level because of the price cap-related concerns.

Speaker #5: But otherwise, OVL has done well both in Sakhalin as well as in other assets. And in OVL, being in the international market, most of the products we get at international prices.

Ajay Kumar Singh: Otherwise, OVL has done well both in Sakhalin as well as in other assets. In OVL being an international market, most of the products we get international prices.

Speaker #3: Got it, sir. Understood. Thanks a lot, and all the best.

Sabri Hazarika: Got it, sir. Understood. Thanks a lot, and all the best.

Speaker #2: Thank you, sir. The next question comes from Vikas Dane from CLSK India. Please go ahead.

Moderator: Thank you, Sam. The next question comes from Vikash Jain from CLSA India. Please go ahead.

Operator: Thank you, Sam. The next question comes from Vikash Jain from CLSA India. Please go ahead.

Vikash Jain: Thanks for taking my questions. Am I audible?

Speaker #5: Thanks for taking my questions. Just yeah, thanks for taking my questions. Am I audible?

Speaker #2: Yes, Vikas?

Ajay Kumar Singh: Yeah, Vikash.

Speaker #5: Yeah, yeah. So just a couple of clarifications. Firstly is peak production of the KG asset. What is it likely to be for gas? And by when are we going to reach that peak production?

Vikash Jain: Just a couple of clarifications. Firstly is peak production of the KG asset. What is it likely to be for gas, and by when are we going to reach that peak production?

Ajay Kumar Singh: Okay. I will answer the query. With the commissioning of CPP, and again, we have some plan to reactivate and enhance the production from 98/2 gas wells. We are expecting more gases, and it will be in the sphere of six to seven million. It will be somewhere not in Q4 because we have to re-enter into gas, that new field gas, once we have to re-enter and we have to start production from there. Somewhere you can say that Q4 of 2027, 2028, we will be reaching this figure.

Speaker #5: So, okay, I'll answer the query. See, with the commissioning of CPP—and again, we have some plans to reactivate and enhance the production from 98/2 gas wells.

Speaker #5: We are expecting more gas, and it will be in the six to seven million range. It will be somewhere, not in Q4, because we have to re-enter those EU field gas wells—we have to re-enter, and we have to start production from there.

Speaker #5: So, somewhere you can say that in Q4 of 2027 or 2028, we will be reaching this figure. Okay. So, we are right now at one and a half. You say that we will be about three plus in this October–December.

Vikash Jain: Okay. We are right now at one and a half. You say that we will be about 3 plus in this October, December, and that 3 will then go to about 7 MMSCMD in another three, four quarters. Is that how one should think about it? Okay. The other thing that you also mentioned was in the October, December quarter, there could be another 2 MMSCMD incrementally coming from Daman Upside, plus this one and a half, and there was another half that you mentioned from the Tapti project, right? There is going to be an incremental 4 MMSCMD, which on your base is roughly equal to 78% increase in production in the October to December quarter. Is that roughly how I should be looking at?

Speaker #5: And that three will then go to about seven MMS CMD in another three to four quarters. Is that how one should think about it? Okay.

Speaker #5: And okay. And the other thing that you also mentioned was in the October-December quarter, there could be another two MMS CMD incrementally coming from Daman upside.

Speaker #5: Plus this one and a half. And there was another half that you mentioned from the TAPTI project, right? So there is going to be an incremental four MMS CMD, which on your base is roughly equal to seven, eight percent increase in production.

Speaker #5: In the October to December quarter—is that roughly how I should be looking at it? That's correct. You are correct, but it is not October to December.

Ajay Kumar Singh: That's correct. You are correct. It is not October to December. Some part of that will be spilling over to January to March.

Speaker #5: Some part of that will be spilling over to January to March. Okay. Okay. The exit for December quarter is how we should think about it.

Vikash Jain: Okay. The exit for December quarter is how we should think about it, not the average for the quarter.

Speaker #5: Not the average for the quarter. Yes, yes. Yeah. And one more thing on production before I ask about Samudra Mantan. On the oil side, you did mention that you are facing some challenges in the oil part of KG.

Ajay Kumar Singh: Yes.

Vikash Jain: Yeah. One more thing on production before I ask on Samudra Manthan. On the oil side, you did mention that you're facing some challenges in the oil part of KG. Could you just give a little bit of basic geological point on what the challenges are, and do you see these as addressable? You did say that you are still hopeful of going back to the earlier peak rate. How should I think of the timelines around that, and what are you thinking of handling these challenges?

Speaker #5: So could you just give a little bit of basic geological point on what the challenges are and do you see these as addressable? And you did say that you're still hopeful of going back to the earlier peak rate.

Speaker #5: How should I think of the timelines around that? And how are you thinking of handling these challenges? Yeah. This is the clarification for 98 by 2 oil wells.

Ajay Kumar Singh: Yeah. This is a clarification for 98/2 oil wells. We are facing a problem of complexity in reservoir, interconnection between one reservoir to other reservoir. That study is in progress with a world-renowned geological study center, and they are providing input also. Based on their input, we will be reworking out, and wherever required, we will be re-entering the wells. We work out the strategy and plan how to do, because each well, whenever we are going to enter, this costs more than INR 500 crores. It is unlike shallow water where we can go and it is cheaper one. Deep water has the costly one. We have to work out in totality cost related to re-entering the wells vis-à-vis economics, how much oil we have expected to gain from them. Study is in way.

Speaker #5: We are facing the problem of complexity in the reservoir. The interconnection between one reservoir and another reservoir is also an issue. That study is in progress with a world-renowned geological study center.

Speaker #5: And they are providing input also. And based on their input, we will be reworking wherever required. We will be re-entering the wells.

Speaker #5: And then we work out the strategy and plan how to do it. Because each well, whenever we are going to enter, this costs more than ₹500 crore.

Speaker #5: So it is unlike shallow water, where we can go and it is a cheaper one. But deep water is the costly one. So we have to work out in totality the cost related to reentry in the wells vis-à-vis economics, how much oil we are expected to get from there.

Speaker #5: So, the study is underway. We'll be coming out shortly with the development strategy. At this juncture, there are no pressure decline or water ingress challenges.

Ajay Kumar Singh: We will be coming out shortly with the development strategy.

Vikash Jain: At this juncture, there are no pressure decline or water ingress challenges. It's just the contiguity that we are talking about, right?

Speaker #5: It's just the contiguity that we are talking about, right? That's correct. So then you have to re-strategize accordingly. Final thing on Samudra Mantan: You mentioned that you've drilled one well, so this latest well will be under Samudra Mantan?

Ajay Kumar Singh: That's correct.

Vikash Jain: You have to re-strategize accordingly. Final thing on Samudra Manthan. You mentioned that you've drilled one well for this latest well will be under Samudra Manthan. Would this be considered to be This is not an exploration well, right? This is something which will be part of you getting more How would this feature, and would you get some reimbursement from the Government? How does it really work?

Speaker #5: So, would this be considered to be one of—this is not an exploration well, right? So this is something which will be part of you getting more—I mean, how would this feature, and would you get some reimbursement from the government?

Speaker #5: How does it really work? You see, this part is still under wraps. We are also privy to the same information as you are, which we got from the press release from the Government of India.

Ajay Kumar Singh: You see, this part is still under wraps. We are also privy to the same information which you are, which we got from the press release from Government of India. Details are still being worked out. Yes, once the Government has decided they will fund that project, all the wells which will be approved, which will be the part of the Samudra Manthan, a part of that will be reimbursed by the Government of India. That is the way it is expected to be.

Speaker #5: Details are still being worked out. But yes, once the government has decided, they will fund that project. So all the wells which will be approved, which will be part of the Samudra Manthan, a part of that will be reimbursed by the Government of India.

Speaker #5: So that is the way it is expected to be. So the expectation would be that you would possibly approach the government, stating that this is where we would like to drill.

Vikash Jain: The expectation would be that you would possibly approach the Government that this is where we would like to drill, and they will approve a particular number linked to that well. Anything incremental will have to come from your pocket and the remaining will be reimbursed by the amount the Government has agreed on will come from the Government. Is that how one should think about it from the very basic preliminary understanding that we have?

Speaker #5: And they will approve a particular number linked to that well. Anything incremental would be under your we'll have to come from your pocket. And the remaining will be reimbursed by the I mean, the amount will the government has agreed on will come from the government.

Speaker #5: Is that how one should think about it, from the very basic, preliminary understanding that we have? See, details are not yet available. But from what we see, it is not going to be some surprise incremental cost which will be funded by the government or ONGC.

Anupam Agarwal: The details are not yet available, what we see it is not going to be some surprise incremental cost, which will be funded by Government or ONGC. Whatever will be the total cost, part of that will be borne by the company, part of that will be made by the Government. It is basically to take a part of the risk of exploration from the oil explorer, and that is the mission Government is looking into to ensure energy security of the country.

Speaker #5: It will be, whatsoever will be the total cost. Part of that will be borne by the company. Part of that will be borne by the government.

Speaker #5: So it is basically to take a part of the risk of exploration from the oil explorer and that is the mission government is looking into to ensure energy security of the country.

Speaker #5: Okay. And if there is a discovery, that discovery belongs to ONGC? Or will you have to get in another partner or anything like that?

Vikash Jain: Okay. If there is a discovery, that discovery belongs to ONGC or will you have to get another partner or anything like that? The reserve, the development production will come for ONGC.

Speaker #5: I mean, that reserve—the development and production—will come for ONGC. The discovery will definitely belong to the owner of that block, who has been awarded that license.

Anupam Agarwal: Discovery will definitely belong to the owner of that block, who has been awarded that license.

Vikash Jain: Sure.

Speaker #5: So, for the blocks where we are going alone, ONGC will be the owner of that discovery. In the blocks where we are going with our partners, it will be the joint venture that will be the owner of that discovery.

Anupam Agarwal: The blocks where we are going alone, we will be the owner of that discovery. In the blocks we are going with our partners, it will be the joint venture who will be the owner of that discovery.

Speaker #5: Okay. Okay. And any guidance on new well gas—how that is going, or that is increased to what numbers? Or, you said that at the start, in your initial comments, what percentage of gas is new well gas?

Vikash Jain: Okay. Any guidance on new well gas, how that has increased to what numbers? You said that at the start of your initial comments, what percentage of gas is new well gas and where do you think this is going to be, say, 12 months out?

Speaker #5: And where do you think this is going to be set 12 months out? You see, as far as in volume terms, this quarter it has already reached 19%.

Anupam Agarwal: You see, as far as in volume terms, this quarter, it has already reached 19%. We expect it will continue to go up as we develop more and more gas reserves, more and more new wells we drill, it will continue to go up. In revenue term, this quarter, it was 38%. Because we got good price this quarter. In sales quantity term, it is around 24%, from last year, 17%.

Speaker #5: And we expect it will continue to grow as we develop more and more gas reserves. With more and more new wells we drill, it will continue to grow.

Speaker #5: And in revenue terms, this quarter it was 38%, because we got good prices this quarter. I mean, in sales quantity terms, it is around 24%, up from last year's 17%.

Vikash Jain: Okay. Thank you, Anupamji. Thank you, Prakashji. Thank you.

Speaker #5: Okay. Thank you, Rupamjit. Thank you, Prakash. Thank you. Bye.

Speaker #3: Thank you, sir. The next question comes from Varadarajan from Antiques Stock Broking. Please go ahead.

Moderator: Thank you, sir. The next question comes from Bharath Rajan from Antique Stock Broking. Please go ahead.

Operator: Thank you, sir. The next question comes from Varatharajan Sivasankaran from Antique Stock Broking. Please go ahead.

Speaker #5: Thanks for the opportunity. Sir, only support the Opal if you can project the details about the payment for that, and the operating rate? Okay. Thank you, Varadarajan.

Bharath Rajan: Thanks a lot. Good morning, sir. Sir, wanted to know about the Opal, if you can provide us with EBITDA impact and operating rates.

Varatharajan Sivasankaran: Thanks a lot. Good morning, sir. Sir, wanted to know about the Opal, if you can provide us with EBITDA impact and operating rates.

Anupam Agarwal: Okay, thank you for raising this. Opal, you know, last quarter, it could not do as good as we expected. Kind of transformative steps we have taken in terms of increasing equity capital, taking up in terms of corporate guarantee from parent company, ONGC, reduce their financial burden. Other steps we had taken regarding this exit from SEZ. All these things had made a major impact on Opal workings and this Q4 FY26 was very good, you would have seen. This quarter, ultimately, the feedstock is linked with international prices of gas and naphtha. With Hormuz crisis happening, our calculations had gone wrong. Because of that, Q1 FY27 EBITDA, we were INR -57, whereas FY26 EBITDA was INR +1,207 crore. That is how Opal is.

Speaker #5: Opal, last quarter, could not do as well as we expected. It was a kind of transformative step we have taken for Opal in terms of increasing equity capital and taking up, in terms of, corporate guarantee from the parent company, ONGC.

Speaker #5: Reduce their financial burden. Other steps we had taken regarding this exit from SCZ. So all these things had made a major impact on Opal workings, and last, this Q4 of April 25-26 was very good, you would have seen.

Speaker #5: This quarter, you know, ultimately the feedstock is linked with international prices of gas and naphtha. With the Hormuz crisis happening, our calculations had gone wrong.

Speaker #5: And because of that, the first quarter of April 27, Edita, we were 57 negative. Whereas April 26, Edita was 1207 crore. And positive, so that is how Opal is.

Speaker #5: But we believe going forward, Opal will be doing much better because of two, three factors which you are also aware. We have decided to exit from C2, C3 also from the SCZ.

Anupam Agarwal: We believe going forward, Opal will be doing much better because of two, three factors which you are also aware. We have decided to exit from C2, C3 also from the SEZ. That will bring about INR 1,000 crore in EBITDA term for Opal. The other thing, what is going to happen, we have already entered into MoU with Mitsui, and we are building up ethane carriers. We will be bringing ethane from international market and with that, our feedstock cost will come down. Present challenge is basically relating to the feedstock. As soon as the feedstock related challenges are over, Opal will be in much better financial health.

Speaker #5: And that will bring about ₹1,000 crore in EBITDA coming for OPaL. The other thing that is going to happen, we have already entered into an MoU with MITRI and we are building up ethane carriers.

Speaker #5: We'll be bringing Ethane from international market. And with that, our feed stock cost will come down. So present challenge is basically relating to the feed stock as soon as the feed stock related challenges are over, Opal will be in much better financial health.

Speaker #5: Okay, thank you. Second question from the—okay, okay. With me, Mr. Devedi is there; he is head of the division. So if you want to—

Bharath Rajan: Okay. Thanks, sir. Second question from the-

Varatharajan Sivasankaran: Okay. Thanks, sir. Second question from the-

Anupam Agarwal: Okay. With me, Mr. Dhruvade is there. He is the Head of DGH. If you want to Dhruvade.

Anupam Agarwal: Okay. With me, Mr. Dwivedi is there. He is the Head of JV & BD. If you want to Dwivedi.

Speaker #5: It's okay. Just because of Hormuz crisis, the plants runs on two feed gaseous feed and nafta. Nafta prices went up from 600, 600 dollars to 1,000 dollars.

Mr. Dhruvade: It's okay. Just because of Hormuz crisis, the plant runs on two feed, gaseous feed and naphtha. Naphtha prices went up from $600 to $1,000. Gaseous feed had to stop. As and when gaseous feed starts, the plant will be normalized.

Satish Kumar Dwivedi: It's okay. Just because of Hormuz crisis, the plant runs on two feed, gaseous feed and naphtha. Naphtha prices went up from $600 to $1,000. Gaseous feed had to stop. As and when gaseous feed starts, the plant will be normalized.

Speaker #5: And gaseous feed has stopped. As in, when gaseous feed starts, the plant will be normalized. Very nice. Thank you. In the context of Samudra Manthan.

Bharath Rajan: Very nice. Thank you. In the context of Samudra Manthan-

Varatharajan Sivasankaran: Very nice. Thank you. In the context of Samudra Manthan-

Speaker #5: Normal times. Normal times. And different parts of the industry are impacted differently. So you would have seen how the marketing companies have been impacted, how the petchem companies have been impacted, how the upstream companies have been impacted.

Anupam Agarwal: These are abnormal times. Different part of industry are impacted differently. You would have seen how the marketing companies have been impacted, how the petchem companies have been impacted, how the upstream companies have been impacted.

Speaker #5: Yes, sir. So, in the context of the Samudra Mantan, do we see a change in the CapEx program? Does the overall CapEx budget go up or down over the next two years?

Bharath Rajan: Yes, sir. In the context of the Samudra Manthan, do you see a change in your CapEx program? Does it make the overall CapEx budget go up, down in next few years?

Varatharajan Sivasankaran: Yes, sir. In the context of the Samudra Manthan, do you see a change in your CapEx program? Does it make the overall CapEx budget go up, down in next few years?

Speaker #5: You see, we have been traditionally spending about 3.5 to 4 billion dollar on Capex. And that number remains. So that is the same situation.

Anupam Agarwal: You see, we have been additionally spending about $3.5 to $4 billion on CapEx, and that number remains. That is the same situation. We will see some upside in exploration CapEx with Samudra Manthan coming in.

Speaker #5: So, we will see some upside in exploration capex with Samudra Mantan coming in. Thank you. Thank you.

Speaker #3: Thank you, sir. The next question comes from Amit Murakka from Access Capital. Please go ahead.

Bharath Rajan: Thank you, sir.

Varatharajan Sivasankaran: Thank you, sir.

Moderator: Thank you, sir. The next question comes from Amit Murarka from Axis Capital. Please go ahead.

Operator: Thank you, sir. The next question comes from Amit Murarka from Axis Capital. Please go ahead.

Speaker #5: Yeah. Hi. Good evening. And thanks for the opportunity. Firstly, on the survey expenses, usually pre-monsoon quarter, the survey expenses are pretty high. But this time, I see that it's not much expenditure has been done on that front.

Amit Murarka: Hi, good evening, and thanks for the opportunity. Firstly, on the survey expenses. Usually, pre-monsoon quarter, the survey expenses are pretty high. This time, I see that not much expenditure has been done on that front. I just wanted to understand the reasons for that.

Speaker #5: I just wanted to understand the reasons for that. Yes, Amit. During the survey, we faced some challenges in contract finalization because the kind of rates we got in our tenders were not workable.

Anupam Agarwal: Yes, Amit. Survey, we had faced some challenges in contract finalization because the kind of rates we got in our tenders were not workable. We had to take a step back and go for re-tender. The major survey contracts have already been awarded, and this October onward, post-monsoon, you will be seeing a big activity coming in survey part.

Speaker #5: So we had to take a step back and go for re-tender. Now, the major survey contracts have already been awarded. And you will see, this October onward, post-monsoon, you will be seeing a big activity coming in on the survey part.

Speaker #5: Okay. So, fair to say that it will catch up for the, let's say, the lower activity in Q1 in the second half then? Yeah, it will catch up.

Amit Murarka: Okay. Fair to say that it will catch up for the, let's say, the lower activity in Q1 in H2 then?

Anupam Agarwal: Yeah, it will catch up. It will more than catch up. More than catch up, because we have lined up a big exploration program, and for that, a lot of survey activities will be happening. Both to support Samudra Manthan and otherwise also.

Speaker #5: It will more than catch up—more than catch up—because we have lined up a big exploration program. And for that, a lot of survey activities will be happening.

Speaker #5: Both to support Samudra Mantan and otherwise also. Right. Right. So that expenditure line item, then, will go up basically in the second half. Yes.

Amit Murarka: Right. That expenditure line item then will go up basically in H2.

Anupam Agarwal: Yes.

Speaker #5: A little. Right. And secondly, on the crude realization, I see that this quarter it was about $3, broadly on an average, above Brent. Was that because - I know that benchmarks, product tax, everything were all over the place.

Amit Murarka: Right. Just secondly, on the crude realization, I see that this quarter was about $3 broadly on an average above Brent. Was that because of I know the benchmarks, product cracks, everything were all over the place. Could you explain that, why did you get this premium versus usually you get maybe a flat to a marginal discount to Brent?

Speaker #5: So could you explain that why did you get this premium versus usually you get a maybe a flat to a marginal discount to Brent?

Speaker #5: This quarter, our realization—we reported about $99 per barrel. And Brent volatility, which has happened in this quarter. Otherwise, in general, if you see, the kind of arrangement we have with our oil marketing companies is that Brent is the base.

Anupam Agarwal: This quarter, our realization, we reported about $99 per barrel. Brent. The volatility which has happened in this quarter. Otherwise, in general, if you see the kind of arrangement we have with our oil marketing companies, that Brent is the base and Brent plus 1%. When we account for the VAT is about 5%. 4% comes to our kitty. That is how the net realization we report in our books.

Speaker #5: And Brent plus 1%. But when we account for that, it is about 5%. So 4% comes to our KT. So that is how the net realization is reported in our books.

Speaker #5: Got it. So currently, the volatility is fine. Fine. Yeah. Just wanted to understand those two things. Thank you very much.

Amit Murarka: Got it. It purely is the volatility. Fine. Yeah, just wanted to understand those two things. Thank you very much.

Moderator: Thank you, sir. The next question comes from Hardik Solanki of ICICI Securities. Please go ahead.

Operator: Thank you, sir. The next question comes from Hardik Solanki of ICICI Securities. Please go ahead.

Speaker #3: Thank you, sir. The next question comes from Hardik Solanki from ICSI Securities. Please go ahead.

Speaker #5: Yes, sir. Thank you for the opportunity. Second question: One of the candidates gave guidance on what is the line Capex for the Nanadi well, and when the result is expected from this well?

Hardik Solanki: Thanks for the opportunity, sir. Two questions. One, kindly give a guidance on what is the planned CapEx for the Mahanadi well, and when the result is expected from this well. That's number one. What is full year guidance for 2027 and 2028?

Speaker #5: That's number one. Secondly, what's the full-year guidance for '27 and '28? What is the second question? And what is the full-year Capex for you, '27 and '28?

Anupam Agarwal: What is the second question?

Hardik Solanki: Sir, what is the full year CapEx for 2027, 2028?

Anupam Agarwal: Yes. Full year CapEx. What is the detail? Full year CapEx, I already told it will be $3.5 to $4 billion range. It depends on how our project progress is. That is the range we will maintain for the full year. Regarding Mahanadi well, it takes about three months to drill a deep water exploration well. We started around 25 July, so you can expect the result sometime in September end. It is about each deep water well will be in the range of INR 800 to 1,000 crore. $100 million per well.

Speaker #5: Full-year Capex for '27 and '28—full-year Capex, I already told, will be in the $3.5 to $4 billion range. So, it depends on how our projects progress.

Speaker #5: That is the range we will maintain for the full year. And regarding Mahanadi, well, it takes about three months to delay a deep water exploration well.

Speaker #5: So we spread it around the 25th of July. So you can expect the result sometime at the end of September. And each deepwater well will be in the range of ₹800 to ₹1,000 crore.

Speaker #5: 100 million dollar. Thank you.

Hardik Solanki: Yes. That's helpful. Thank you.

Speaker #3: Next question comes from Yogesh Patil from Dholak Capital. Please go ahead.

Moderator: Next question comes from Yogesh Patil from Dolat Capital. Please go ahead.

Operator: Next question comes from Yogesh Patil from Dolat Capital. Please go ahead.

Speaker #5: Thanks for the opportunity again, sir. Still, production issues have sharply declined in the case of gas, both from nominated fields as well as from the JV fields.

Yogesh Patil: Thanks for an opportunity again, sir. Sales to production ratio has sharply declined in case of gas from nominated as well as gas from the JV fields. Any particular reason? Earlier it remained in the range of 79. It has declined to in the range of 75, 76 in this quarter.

Speaker #5: Any particular reason? Earlier, it remains in the range of 79. It has declined to in the range of 75, 76 in this quarter. Yes, Yogesh.

Anupam Agarwal: Again, yes, Yogesh. You are aware that we talked about in some isolated areas, the customers could not take that gas because of pricing challenges or some operational challenges. Because of that, our sale could not keep pace with the production. That is the major reason.

Speaker #5: You are aware that we talked about in some isolated areas the customers could not take that gas because of pricing challenges or some operational challenges.

Speaker #5: Because of that, our sales could not keep pace with production. So that is the major reason. Okay. And the second question, sir, regarding the LPG production segment and the sales segment.

Yogesh Patil: Okay. The second question, sir. LPG production segment and the sales segment. If we back calculate the LPG price realization based upon the data provided by the company, the realization comes around $896 per ton, which is much, much higher than the Saudi LPG benchmark price. This premium is much higher. I mean, $120, $130 per ton higher than the Saudi LPG benchmark price. Any reason, sir, a higher realization on the LPG side?

Speaker #5: If we back-calculate the LPG price realization based on the data provided by the company, the realization comes to around $896 per ton, which is much, much higher than the Saudi LPG benchmark price.

Speaker #5: And this premium is much higher. I mean, $120 to $130 per ton higher than the Saudi LPG benchmark price. Any reason, sir, for a higher realization on the LPG sales?

Speaker #5: You see, these were volatile times. Because of post-pandemic conditions, the market behavior was not normal. So it is basically because of those volatilities we could get a higher realization during that period.

Anupam Agarwal: You see, these were volatile times. Post-Hormuz, the market behavior was not normal. It is basically because of those volatilities we could get a higher realization during that period.

Speaker #5: But our LPG price realization is March to Saudi CP, or something else? Just wanted to understand that. That detail, I will not be able to, I'm not having it immediately with me.

Yogesh Patil: Our LPG price realization is marked to Saudi CP or something else, sir? Just wanted an understanding, sir.

Anupam Agarwal: That detail I'm not having immediately with me.

Speaker #5: Yeah, Yogesh, I will share those. Our IRC will get in touch with you and provide any further clarifications if you require them.

Yogesh Patil: Yeah. Obviously, I will share this with you.

Anupam Agarwal: Our IRC will get in touch with you and give you any clarification further if you require on that.

Speaker #5: Sure, sir. Thanks. Thanks. Thanks a lot, and all the best. Thank you.

Yogesh Patil: Sure, sir. Thanks a lot, and all the best.

Speaker #3: Thank you, sir. The next question comes from—sorry, sir, there are no questions. Now I hand over the floor to Mr. R. S. Naghi for closing comments.

Anupam Agarwal: Thank you.

Moderator: Thank you, sir. Sorry, sir, there are no questions. Now I hand over the floor to Mr. RS Negi for closing comments.

Operator: Thank you, sir. Sorry, sir, there are no questions. Now I hand over the floor to Mr. RS Negi for closing comments.

Speaker #5: Thank you, madam. Good afternoon. We hope we have answered all the queries raised by the participants. In case any further queries are there, they can reach out to our Investor Relations cell itself.

Ravinder Singh Negi: Thank you, madam. Good afternoon. We hope we have answered all the queries raised by the participants. In case if any further queries are there, they can reach out to our investor relations cell itself. I thank Dr. Finance, sir, ONGC for addressing the participants and answering all the queries from the participants. I also thank all my senior colleagues for participating and also all the participants for participating in this conversation. Thank you very much.

Speaker #5: I thank Director Finance, sir, ONGC, for addressing the participants and answering all the queries of the participants. I also thank all my senior colleagues for participating, and also thank all the participants for participating in this conversation.

Speaker #5: Thank you very much. Thank you. Thank you.

Yogesh Patil: Thank you.

Moderator: Ladies and gentlemen, this concludes your conference for today. Thank you for your participation and for using Doosrabas Conference Call Service. You may disconnect your lines now. Thanks, and have a pleasant evening.

Operator: Ladies and gentlemen, this concludes your conference for today. Thank you for your participation and for using Doosrabas Conference Call Service. You may disconnect your lines now. Thanks, and have a pleasant evening.

Speaker #3: Ladies and gentlemen, this concludes your conference for today. Thank you for your participation and for using Do Saba's conference call service. You may disconnect your lines now.

Speaker #3: Thanks, and have a blessed evening.

Anupam Agarwal: Thank you.

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Q1 2027 Oil and Natural Gas Corp Ltd Earnings Call

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