The well G-1-9 in Bay of Bengal has been leaking gas since August-end and all efforts by ONGC to contain the flow have so far been futile and there are fears that the well may start spilling oil too, which may spell environmental disaster
New Delhi: A deepwater well in a Krishna Godavari (KG) basin block operated by state-run Oil and Natural Gas Corp (ONGC) has been leaking gas for two months and there are now fears of environment damage due to the uncontrolled flow, reports PTI.
The well G-1-9 in Bay of Bengal has been leaking gas since August-end and all efforts by ONGC to contain the flow have so far been futile.
"This is a very old, drilled some eight or 10 years back. It wasn't producing till now and we had plans to put in on production sometime next year along with other gas finds in the area," a company official said.
However, an uncontrolled flow of gas started from the well around 30th August.
After attempting in-house solutions, the company is now looking at outside specalists to cap the well. There are fears that the well may start spilling oil too, which may spell environmental disaster.
"We have no idea how much gas (mostly methane) might have spilled but I suppose it must be at least one lakh cubic meters per day," the official said.
ONGC is developing G-1 field along with neighbouring GS-15. Both the fields are marginal or small finds. G-1-9 well was part of this development through which ONGC had planned to produce 2.7 million standard cubic meters of gas and 9,400 barrels of associated oil daily.
The official said The company has sought help of Coast Guard and Navy as well as neighbouring operators like Reliance Industries-BP combine and Cairn India to control the gas leak.
ONGC had in the integrated development of G-1 and GS-15 targeted to produce 0.982 million tonnes of oil and 5.92 billion cubic meters of gas by 2020-21.
The project at the time of conception in 2003 was to cost Rs429.82 crore but the cost was subsequently revised to Rs1,262.93 crore in 2004 and then to Rs2,218.01 crore in 2010.
The company had planned to being production from the fields by April-May but the gas spill may result in delays, he said adding drilling on GS-15 field was completed last August.
The project had time and cost overrun as the contactor (Clough Ltd of Australia) defaulted in work. ONGC terminated the contract in June 2006.
Of the two, G1 is a deepwater field and is located 20 km away from the shore. GS15 is a shallow water field. G1 was the first deepwater field to be developed by ONGC.
Higher depreciation, increased finance cost and higher salaries led to a drastic drop in the bottomline of Yuken India, a parts and ancillary manufacturer
Yuken India, a parts and ancillary manufacturing company, has reported abysmal results for the quarter ended 30 September 2012. Its net profit plummeted by 82% year-on-year (y-o-y), to Rs41 lakh. However, its net sales declined marginally, by 5% y-o-y, from Rs40.61 crore recorded on 30 September 2011, to Rs38.70 crore for the current September quarter. The culprits were higher depreciation, interest costs and higher salaries. The stock tanked by 10.98% on Bombay Stock Exchange (BSE) and ended the day at Rs150.40.
An analysis of Moneylife database on the company shed some light on the reason for poor performance. In fact, this is the first time in four years that sales have actually declined. Until then, it had been growing steadily and consistently. Global economic troubles meant that the export market was challenging, with demand falling. However, what is worrying the company is its operating parameters. Its operating profit plummeted by a whopping 47%, which is way below its three-quarter y-o-y average of -13%. Higher salaries meant retention of talent in tougher times. It suffered badly only in the last two quarters, whereas before that it was growing steadily. However, the biggest blow was the net profit, which declined by 82%. This was due to higher depreciation and finance cost, which increased by around 66% and 50%, respectively. Despite this, the company has a decent return on equity (ROE) of 18%. Its valuation is on the lower end, with market capitalization at over five times operating profit.
The company has a tie-up with Yuken Kogyo Company (YKC), based out of Japan, which holds 40% of the joint-venture while Indian promoters—Benefic Investments and Finance, along with the Rangachar family—hold around 12.54%. This shareholding pattern has been the same for a long time, indicating total commitment to the business. In the past 34 years, YIL has achieved the fastest growth rate in the oil hydraulics segment in India. Most manufacturers of original equipment have accepted YIL as their preferred partners for hydraulics.
Yuken India manufactures pumps and valves for major industrial segments including steel plants and steel mills, machine tool manufacturers, plastic machinery manufacturers, defence, automobile manufacturers, hydraulic presses, drill rig manufacturers, power projects and the cement industry.
BHEL reported nearly 10% decline in net profit at Rs1,274.5 crore for the second quarter
Mumbai: Shares of state-run BHEL on Monday fell over 6% wiping off Rs3,672 crore in investor wealth after the state-owned company reported nearly 10% decline in net profit for the quarter ended September 2012, reports PTI.
Following the disappointing results, shares of BHEL fell by 6.64% to finally settle at Rs227.25, down 6.19% on the BSE. At NSE, the scrip closed at Rs226.50, down 6.58%.
In the process, the market capitalisation of the company plunged by Rs3,672 crore to Rs55,621 crore.
"The stock was hammered not only because the results were below street expectation, but also the outlook at least for next 1-2 years is weak," Nagji K Rita, CMD, Inventure Growth & Securities said.
According to Rikesh Parikh, Vice President, Markets Strategy and Equities, Motilal Oswal Securities: "The key concern of erosion in the company's order backlog remains."
BHEL today reported nearly 10% decline in net profit at Rs1,274.45 crore for the second quarter ended September 2012. The power equipment major had net profit of Rs1,412.03 crore in the July-September quarter of last financial year.
BHEL said that its income from operations in the July-September quarter grew a little over 2% at Rs11,009.28 crore, from Rs10,758.08 crore in the same period last fiscal.