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Hindustan Oil Exploration Company jumped 10.16 per cent (₹6.85) to its year-high of ₹74.25 a share, a day after the company announced its results for the quarter ended December.
However, the trigger for the share price rise did not come from the results — which showed the company made a post-tax profit of ₹4.18 crore on a turnover of ₹5.49 crore, compared with ₹13.11 crore and ₹5.55 crore in the previous quarter.
When contacted by BusinessLine , HOEC sources said the company had secured the only clearance that was pending for it to go in for gas production — a forest clearance to build an eight-km pipeline. That part of the pipe that stretches from HOEC’s wells to Oil India’s facility at Khusijan, Assam.
OIL, incidentally, is both a partner (along with IOC) and a customer to HOEC in the Assam asset. All but that eight-km segment has been completed; only that little bit was pending for want of forest clearance.
First production by MarchCompany sources said the eight-km pipeline would take not more than two months to complete. As such, the first production of gas from the Dirok field in Assam (AAP-ON-94/1) in which HOEC has 27 per cent interest, will begin in March.
When the production reaches steady-state in two months from then, it would produce 20 million cubic feet of natural gas a day, and 100 barrels of condensates (liquids similar to crude oil).
Under a $100-million development plan that is underway, HOEC has worked over three exploratory wells to convert them into producers. Later, two more will be drilled. A ‘group gathering station’ will combine the gas from all the wells and pipe it to a ‘separation plant’ to strip condensates from the gas. Both gas and condensates will then flow to the customer, Oil India.
The Dirok field will then be the first producing asset of HOEC after the management changed, from the Italian ENI group into the hands of professionals P Elango and Ramasamy Jeevanandam, friends from their ONGC days. Elango is HOEC’s Managing Director, while Jeeva looks after finance.
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