The Oil and Natural Gas Corporation (ONGC) capital expenditure (capex) during FY21 is likely to be close to Rs 32,500 crore target as it is doubling efforts to make up for the time lost due to COVID-19 pandemic.
The COVID-19 outbreak and the global restrictions that followed had disrupted the supply chain, hitting its project implementation.
The oil and gas exploration and production projects are highly dependent on foreign vendors for the supply of equipment and services, and also some facilities such as rigs are operated by a foreign crew.
However, with the gradual resumption of economic activity globally, the oil and gas company is hopeful of making up for the lost time.
The company, in April and May 2020, had recalibrated capex spending to Rs 26,000 crore on the assumption of a long-drawn impact of the pandemic on economic activity. However, with the unlocking, the company will be able to achieve spending of close to Rs 32,000 crore.
ONGC had budgeted Rs 32,501 crore of capital expenditure for FY21. The company has taken up project work on war footing to meet the capex target.
The company is in the process of recasting the numbers on capex for FY22. It had projected Rs 32,000 crore to Rs 33,000 crore capex for FY22, however, post COVID-19 it will have to recalculate the numbers.