OIL India Limited Q2 profit drops 42% to Rs 381.75 crore owing to blowout control expense

Oil India Ltd (OIL), the second-biggest state-owned oil producer of the country, has reported 42 percent drop in September quarter net profit largely on account of lower oil prices and one-time expense it incurred on controlling a blowout in Baghjan, Assam.

Net profit in July-September at Rs 381.75 crore was lower than Rs 661.53 crore net profit in the same period a year back, the company said in a stock exchange filing.

OIL said “To control the blowout, all necessary remedial actions (have) been undertaken by the company,” it said adding the total losses/damages arising out of the blowout can be assessed on successful control of the blowout.

The PSU is still trying to control the blowout. “However, as on September 30, 2020 an amount of Rs 227.51 crore has been incurred to control the blowout and the same has been shown as an exceptional item in the statement of profit and loss,” it said. Out of Rs 227.51 crore, Rs 134.12 crore has been booked during September quarter. Turnover fell 32 percent to Rs 2,175.87 crore in the second quarter of the current fiscal.

A fall in international oil prices led to revenue from the sale of crude oil slump by 32 percent and segment pre-tax profit more than halved to Rs 432.27 crore. Lower natural gas prices also saw revenues from its sales slump 41 percent and pre-tax profit drop to Rs 51.70 crore from Rs 176.93 crore in July-September 2019.