Q1 2027 Hindustan Oil Exploration Company Ltd Earnings Call Transcript
Key Points
- Kharsang field production doubled year-over-year, with crude output rising from approximately 12,300 to 17,400 BOE, and workovers on additional wells are incrementally boosting output.
- Crude and condensate realizations improved significantly to about $95.5 per barrel, and gas realizations rose to $12 per MMBTU, driven by favorable Brent prices and higher Kharsang production.
- Progress on resolving the HPCL issue is underway, with crude offtake continuing and resale to third parties, aiming to clear the entire inventory by end of October or early November.
- The Dirok field's evacuation bottleneck is being addressed: PNGRB has designated the DNPL line as a common carrier, and hot tapping work is expected to restore full capacity to 2.5 million standard cubic meters per day by December.
- The company is advancing development projects, including the B15 FDP preparation, Kharsang phase 2 drilling (with rig identified and tubulars ordered), and new technology trials in Cambay assets (belt technology and thermonic heaters) to increase production by 20-30%.
- BAT field production was impacted by higher water cuts from a producing well, leading to lower output, and the workover of two wells is delayed, with final award expected this month and mobilization by October.
- The HPCL dispute reversal led to a negative revenue of 194 crores in the previous quarter, and the company is incurring losses of 7-10% on the resale of crude, with slower-than-expected offtake.
- PY1 field suffered serious production loss, and drilling of two new wells is contingent on securing firm gas sales agreements with buyers like IOCL or Gail to avoid well damage from shut-ins.
- Kharsang gas monetization is delayed due to lack of a pipeline; a route survey is just starting, and regulatory clearances for forest areas may push pipeline completion to 14-18 months.
- The company faces funding constraints for its CapEx program, particularly for the B80 (BAT) workovers and new wells, and is seeking debt financing, with cash flow sufficiency only expected by late 2027.
Ladies and gentlemen, good day and welcome to the Hindustan Oil Exploration Company Limited Q1 FY27 Earnings Conference Call. As a reminder, all participant lines will be in the listen-only mode and there will be an opportunity for you to ask questions at the end of today's presentation.
Should we need assistance during this conference call, please signal an operator by pressing *10 on your touch tone phone.
Please note that this conference is being recorded. I would now like to hand the conference over to Ms. Saloni Soni from EY.
Thank you and over to you ma'am.
Good day everyone and welcome to the Q1 FY27 earnings conference call of Hindustan Oil Exploitation Company Limited.
The company published its results yesterday and have uploaded the investor presentation on the exchanges earlier today.
I trust all of you would have had the opportunity to review them.
Before we start, a disclaimer.
Some of the statements made in today's earnings call may be forward-looking in
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