The domestic oil and gas production has remained tepid in FY20, with fewer discoveries and depleting reserves. And now the crashing oil prices won’t be liked by the oil and gas exploration and production sector. While the effects of oil price crash will be visible in the final quarter of FY20, the 9MFY20 earnings of the E&P sector has also seen slow to negative growth due to the pre-corona economic slowdown as well as post-corona lockdown.

However, Mari Petroleum Company Limited has continued to witness growth in earnings. The E&P company’s net revenues grew by 30.7 percent year-on-year in 9MFY20, which was due to around 10-11 percent year-on-year hike in wellhead price of Mari gas field. On the volume front, the gas production from the key field stood at around 181,000mmcf for 9MFY20, lower by 2 percent year-on-year.

Other than the topline, growth in earnings also came from significant increase in finance income, which was due to better fund management and higher interest income.  These were offset by growth in expenses particularly the royalty, and exploration and prospecting expenditure – increase in the latter was due to higher exploration and drilling activity and seismic data acquisition.

The company plans to continue its exploration and drilling activity during the COVID-19 crisis by taking precautionary measures for it staff and workers. However, the coronavirus pandemic will likely leave the government’s plans for privatisation in FY20 incomplete that included 18.5 percent shares of Mari Petroleum Company Limited as well.