OIL India Q2 profit drops 42% to Rs 381.75 crore on blowout expense

Oil India Ltd, the nation's second-biggest state oil producer, on November 9 reported 42 percent drop in September quarter net profit largely on account of lower oil prices and one-time expense it incurred on controlling a blowout in Assam.

Net profit in July-September at Rs 381.75 crore was lower than Rs 661.53 crore net profit in the same period a year back, the company said in a stock exchange filing.

OIL said a blowout occurred in a producing well (Baghjan#5) in Tinsukia district of Assam on May 27 and the well caught fire on June 9. "To control the blowout, all necessary remedial actions (have) been undertaken by the company," it said adding the total losses/damages arising out of the blowout can be assessed on successful control of the blowout.

The company is currently trying to control the blowout. "However, as on September 30, 2020 an amount of Rs 227.51 crore has been incurred to control the blowout and the same has been shown as an exceptional item in the statement of profit and loss," it said.

Out of Rs 227.51 crore, Rs 134.12 crore has been booked during September quarter. Turnover fell 32 percent to Rs 2,175.87 crore in the second quarter of the current fiscal.