Economy News

Capex spending of oil & gas PSUs at Rs 6,669 cr in April

The company’s capital expenditure target for FY25 is lower than Rs 37,000 crore it spent in FY24.

Indian oil and gas public sector companies have spent over Rs 6,669 crore as capex in the first month of the current financial year, nearly 6% of their total capex target of Rs 1.2 lakh crore, provisional data from the Petroleum Planning and Analysis Cell showed.

The capital expenditure during April was driven by Oil and Natural Gas Corp, Indian Oil Corp, and Hindustan Petroleum Corp. While ONGC incurred a capex of Rs 2,283 crore constituting 7.4% of its annual capex target of Rs 30,800 crore, Indian Oil spent Rs 2,174 crore of its annual target of Rs 30,909 crore in April.

ONGC is expected to invest a major portion of its capex towards increasing its oil and gas production from the KG-98/2 block in FY25. The company expects the oil output from the block to increase to 20,000 barrels per day in the third quarter of the current fiscal and then subsequently reach its peak production of 45,000 barrels per day in Q4FY25.

The company’s capital expenditure target for FY25 is lower than Rs 37,000 crore it spent in FY24.

The country’s top oil producer’s overseas arm, ONGC Videsh Ltd (OVL), spent Rs 241 crores of its full year target of Rs 5,580 crore last month. The company is expected to boost overseas oil and gas production and will be investing 71% more this year than the capex in FY24 which stood at Rs 3,262 crore.

Oil India incurred a capex of Rs 259 crore in April, accounting for almost 4% of its annual target of Rs 6,880 crore. HPCL and Bharat Petroleum Corp spent Rs 800 crore and Rs 243 crore respectively in April. The country’s state-owned downstream companies intend to boost their refining capacity and strengthen their marketing infrastructure going ahead. 

The country’s leading natural gas company, GAIL India spent a meager Rs 262 crore in April, 3.2% of its annual target of Rs 8,044 crore, as per the oil ministry’s data.In FY24, state-owned oil companies cumulatively spent close to Rs 1.3 lakh crore, up 12% from the amount spent in FY23.

During the last fiscal, ONGC, Indian Oil, BPCL, HPCL, GAIL and Oil India – all exceeded their initial annual capex target for the year.

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