Due to increasing pricing, Essar Oil & Gas's earnings increased by 51% to Rs 335 cr in FY23

 Due to increasing pricing, Essar Oil & Gas's earnings increased by 51% to Rs 335 cr in FY23

On a YoY basis, EBIDTA increased by nearly 205% to over Rs 700 crore. 

As a result of lower operating expenses and better sales, Essar Oil and Gas Exploration and Production Ltd (EOGEPL) declared a record net profit of Rs 335 crore on Monday.

The firm reported a net profit of Rs 335 crore in 2022–23 as opposed to Rs 212 crore in the prior year.

The producer of unconventional hydrocarbons recorded FY23 fiscal revenue of Rs 900 crore, an increase of roughly 1.8 times over FY22.

Due to lower operational expenses and internal consumption, the EBITDA margin "experienced a significant improvement of nearly 3,100 basis points, reaching 77 percent," the report stated.

Two-thirds of India's gas output, known as coal bed methane (CBM), is being produced by EOGEPL from coal seams. In order to increase output, it intends to spend Rs 2,000 crore over the next 18 to 24 months digging 200 more wells.

Every day, it generated 0.84 million standard cubic metres of CBM. The firm aims to contribute 5% of India's total gas output during the following five years. The only CBM project in India to have produced more than 82 billion cubic feet of CBM gas to far is its Raniganj block, which has produced the most CBM to date.

In order to increase gas production from the existing wells, EOGEPL, which is currently operating about 350 wells in the Raniganj CBM calculations block in West Bengal, has adopted a systematic approach to well revival with the adaptation of top-tier technology and activation techniques, which includes re-fracs and close monitoring.

The firm presently gives the state exchequer Rs 150 crore yearly, but if the production of CBM from Raniganj is scaled up, that contribution is expected to increase to Rs 300 crore.

According to EOGEPL, it has a clear plan for increasing output from the block to over 3 mmscmd and doubling its CBM reserve base in the upcoming years.

Pankaj Kalra, Chief Executive Officer of EOGEPL, commented on the results, saying, "Our team is regularly outperforming its expectations and achieving great operating performance year on year backed by ramp up in gas production, as well as by optimising and drastically lowering internal consumption. The business is still devoted to its top goals of improving the fields and introducing new technologies that increase output while reducing costs.

To implement a staged expansion strategy and accomplish these goals, the firm has enlisted the assistance of internationally recognised service providers and technical experts. The strategy calls for the rapid development of the Raniganj block's deeper CBM area as well as the drilling of new directional and horizontal wells.

In order to increase productivity and streamline procedures in the sector, EOGEPL has teamed with Sensia for digitalization and remote operations in oil and gas fields.

In order to expand coal bed methane (CBM) output, it has previously announced investments in microbial ECBM technology. This was done with the intention of utilising cutting-edge techniques for greater extraction and efficiency in the energy industry.

In the statement, it is stated that "the company is also devoted to broadening into new areas, the latest of which is shale gas investigation, which will help the company solidify its claim as one of the major unconventional petroleum players in the area."