Oil Exploration Stock Rises 2.7 Per Cent As Company Wins 332.4 Sq Km Mumbai Offshore Block With 2 Discoveries and Plans Rs 1,000 Crore Investment
The stock has delivered a negative return of -11.74 per cent over the past one year and -13.79 per cent over the last three years.
Hindustan Oil Exploration Company Ltd (HOEC) is witnessing strong intraday momentum, currently trading at Rs 175.35, up Rs 4.65 or 2.72 per cent from the previous close of Rs 170.70. The stock opened higher at Rs 172.80 and continued its upward trajectory in the morning session. The positive movement is attributed to a significant corporate development the company has been awarded a new oil and gas block in the Mumbai Offshore region.
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Hindustan Oil Exploration Company Limited (HOEC) has been awarded a new contract area, MB/OSDSF/B15/2024, under the Special Discovered Small Fields Bid Round 2024. This block, located in the Mumbai Offshore region, spans 332.4 square kilometers and includes two discoveries, B-15A-1 and B-15-2, with potential for further exploration. The B-15A-1 well has tested approximately 1.66 million standard cubic feet per day (mmscfd) of gas and 1833 barrels of oil per day (bopd), while the B-15-2 well has tested around 1151 barrels of oil and 0.91 mmscfd of gas. HOEC holds a 100 per cent participating interest in this block, which complements its existing Block MB/OSDSF/B80/2016 in the same region, expanding the company's total acreage to over 800 square kilometers.
The Managing Director, Mr. Ramasamy Jeevanandam, emphasised the company's commitment to enhancing its asset base and leveraging offshore expertise to drive sustained growth. HOEC aims to unlock the full potential of this block through the development of existing discoveries and potential drilling of new wells.
Hindustan Oil Exploration Company Limited was set up in 1983 as a pioneer of the private exploration and production in India focused on crude oil and natural gas. HOEC operates in Tamil Nadu, Maharashtra, Gujarat, Assam and Arunachal Pradesh, and has a portfolio of 10 oil and gas blocks of discovered resources and 1 exploratory block. It has two key assets: the PY-1 field in the Cauvery Basin and the Dirok gas field in the Assam-Arakan Basin. The company is still in operation even after revenue from the Dirok field declined in FY24. The Cambay fields are to be developed with more wells and artificial lifting. The B-80 block, a joint venture with Adbhoot Estates, started production in December 2022. The company plans to spend Rs 1,000 crore in the next three years on drilling development and exploratory wells. HOEC’s revenue mix is largely from natural gas and it is further enhancing its offshore operating edge and also looking at growth opportunities offshore and in the North East.
Hindustan Oil Exploration Company Limited has a market capitalisation of Rs 2,257 crore. The stock has delivered a negative return of -11.74 per cent over the past one year and -13.79 per cent over the last three years. It is currently trading at a price-earnings (PE) ratio of 13.08. Among the major public shareholders, Ashok Kumar Goel (in the capacity of Trustee – Ashok Goel Trust) holds 13.96 per cent, while other key stakeholders include LLP with 6.60 per cent, LCI Estates LLP with 6.13 per cent, another LLP with 6.13 per cent, and Dhoot Industrial Finance Ltd with a 4.69 per cent stake.
Investors should keep an eye on this Small-Cap stock.
Disclaimer: The article is for informational purposes only and not investment advice.