NEW DELHI: Flagship explorer ONGC’s December quarter net profit dropped 67% from a year ago to Rs 1,378 crore from Rs 4,2226 crore a year ago as a sharp decline in domestic gas prices and higher statutory levies offset the benefit of a rebound in prices.
Undaunted, the company board on Saturday approved formation of a wholly-owned subsidiary for gas and LNG business, the new growth area in the oil sector as the world goes through energy transition.
The company realised $43.9 per barrel on crude in the quarter under review against $58.24 a barrel in the previous corresponding period, the company said in a statement.
“The company (subsidiary) is being formed with the objective of sourcing, marketing and trading of natural gas, LNG business, hydrogen enriched CNG (HCNG), gas to power business, bio-energy/ bio-gas/ bio methane/ other biofuels business, etc,” the statement said.
ONGC said its board has also approved acquisition of 5% in Indian Gas Exchange Ltd (IGX) as strategic investment.
“As an important stakeholder in the gas sector, it would be critical for ONGC to participate at the gas exchange for development of the gas sector. ONGC’s interests towards realizing maximum value from its gas marketing efforts may be substantiated through this first gas trading platform in the country,” the company said.