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Vedanta Ltd is hopeful of getting an extension as the operator for its prolific Barmer asset from the Ministry of Petroleum and Natural Gas by the year-end. Arun Kumar, CFO, said: “We have applied for an extension under our existing terms and expect it to come under the automatic route by the end of the year.”
He clarified further that Vedanta is confident of being able to get an extension without having to shed more of its revenues through profit petroleum committed to the government.
Vedanta’s current position contradicts the government’s terms as in March last year, the government had approved a policy to grant an extension for Production Sharing Contract for oil and gas exploration and production. The policy made the provision of an extension subject to a 10 per cent higher revenue commitment to the government through profit petroleum.
Vedanta has reported a ₹4,802-crore bottomline for the fourth quarter of the financial year 2017-2018. This is 81 per cent higher than the ₹2,647-crore net profit reported during the corresponding period of the financial year 2016-2017.
Exceptional gain
Net sales or the total income from operations stood at ₹27,630 crore which was 17 per cent higher than the ₹23,691-crore top line reported in the last quarter of financial year 2016-2017.
The better bottomline can be attributed to an exceptional gain of ₹2,869 crore. A company statement said that these exceptional gains were mainly on account of reversal of previously recorded impairment of ₹7,016 crore at the oil and gas business following the progress on the key growth projects which are expected to result in enhanced recovery of resources.
This exceptional gain was partially offset by impairment of iron ore Goa assets of ₹2,329 crore due to suspension of mining operations from March 16, 2018, after a Supreme Court Order dated February 7, 2018, and reclassification of Foreign Currency Translation Reserve relating to subsidiary investment companies under liquidation of ₹1,485 crore, the company statement added.
Commenting on the plans ahead, Kuldip Kaura, CEO, Vedanta, said: “The capital expenditure cycle is currently going on. We aim to double our crude oil production from the 200,000 barrels oil per day to around 350,000 bopd in three years and then take it up to 500,000 bpd. We plan to invest around $2.5-$3 billion and have invested around 50 per cent of it as orders have been placed.”
Regarding gas, Kaura said that the company currently produces 15,000 barrels of oil equivalent gas and aims to double production within the next 18-24 months.
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