Hindustan Oil Exploration Company (HOEC), which reported a ten-fold increase in its net profit for the year 2022-23, now plans to drill 18 wells in Arunachal Pradesh to quadruple oil production from the Kharsang field there.
After the B-80 offshore field in the Arabian sea went into production in December 2022, the company saw a surge in its fortunes. For 2022-23, it reported a net profit of ₹194 crore, up from ₹19 crore in 2021-22. Topline went up to ₹567 crore from ₹167 crore, previously.
That this was aided by the sales of oil from B-80 is seen from the numbers for the fourth quarter of last year — when the turnover increased to ₹179 crore from ₹43 crore previously, and profit went up to ₹106 crore, from a net loss of ₹27 crore in the same period of the previous year.
Now, HOEC intends to drill 18 wells in the Kharsang field of Arunachal Pradesh, not more than 100 km from its gas-producing Dirok field in Assam.
Field development plan
According to the field development plan approved by the Directorate General of Hydrocarbons, the Kharsang Phase-I programme will quadruple the company’s oil output to 1,800 barrels a day, in three years.
Each well would cost about $1.5 million to $2 million, the company’s Managing Director, Pandarinathan Elango, told businessline on Monday.
To start work in the field, HOEC has to get the production sharing contract (PSC) with the government extended by 10 years.
In the Kharsang field, HOEC has a 30 per cent participating interest—25 per cent directly and 5 per cent by virtue of its holding half the equity of Geopetrol International, which has 10 per cent stake in the field. A company called JIKPL, part of the Inverine Energy group has 25 per cent and the other 40 per cent of Kharsang is held by Oil India Ltd.
In the second Phase, HOEC would drill deeper into the field to look for gas deposits, Elango said.
On the NSE today, the HOEC share closed at ₹181.85, which was ₹3.1 (8.73 per cent) higher than the previous close.