Hindustan Oil Exploration Company Limited (NSE: HINDOILEXP) Q3 2026 Earnings Call dated Feb. 18, 2026
Corporate Participants:
R Jeevanandam — Managing Director
N. S. Senthilnathan — Chief Financial Officer
Analysts:
Unidentified Participant
Gautam Rajesh — Analyst
Harshit Khadka — Analyst
Dhruv Ravani — Analyst
Sukrit D. Patil — Analyst
Sabri Hazarika — Analyst
Amit Mehendali — Analyst
Ritesh Gandhi — Analyst
Rajiv Agarwal — Analyst
Anubhav Goel — Analyst
Presentation:
operator
[Starts Abruptly] And there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during this conference call, please signal an operator by pressing Star then zero on your touchstone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Loni Soni from Ernest and Young Investor Relations Team. Thank you. And over to you, Mr. Dhoni. Thank you. Good day everyone and welcome to the Q3 earnings call of Hindustan Oil Exportation Co. Ltd. The company published its result on February 13 and has uploaded the investor presentation on the exchanges yesterday.
I trust all of you have had the opportunity to review them before we start. A disclaimer. Some of the statements made in today’s earnings call may be forward looking in nature. Such forward looking statements are subject to risks and uncertainties which could cause actual results to differ from those anticipated. Participants are cautioned not to place undue reliance on these forward looking statements while making their investment decisions. On that note, let me introduce you to the management participating with us in today’s conference call. We have with us Mr. R. Jeevananda, Managing Director, Mr. Sensel Nathan, CFO and Ms.
Josephine Deity, Company Secretary. Without further ado, I would like to hand over the call to Mr. Jeevanandam. Thank you. And over to you sir.
R Jeevanandam — Managing Director
Thank you. Good morning everyone and welcome to the quarter three financial year 26 earnings call. From our team, I have Krishnan Raghavan, our Chief Technical Officer and Senthil, our Chief Financial Officer joining me on this call. I will start with the updates on the northeastern region. Let me begin with an update on the Kashang block. As of today we have drilled eight wells and ninth well is in progress. Out of eight wells, five wells are oil wells and six well is completed as gas well. The other two wells will be perforated once the drilling of the ninth well is completed and will be hooked up for production.
6 well encountered with well control issue is resolved and converted as gas producer. It was tested for production and with a minimum choke it can be on continuous production of about 2 million standard cubic feet per day. The results from the six well authenticate the substantial volume of gas which can be commercialized at the earliest once the northeast gas grid is fully operational. Though we have completed the drilling of 7th and 8th well will be perforated along with 9th well once the drilling of the 9th well is completed. As all the three wells are in the same plinth.
You are aware that we have secured environmental clearance for drilling 40 development wells and three exploration wells in the block. We will continue to drilling to reach the full potential of the block subject to partners approval. Our current production level is about 800 barrels per day and some workover of existing wells could not be taken up due to repair of workover the well control issue. We honestly hope that with the support of Oil India Ltd. We can unlock substantial value for all stakeholders in the block. GNG Review of the data of newly drilled wells with the data of old wells authenticate the potential of the field already communicated by gta.
We have received responses to the expression of interest of our 2000 Rupert Rig as well as thousand R s per rig. We will finalize the drilling rigs to progress further. For the Dirac field, the revised field development plan has been approved enabling an extension of the block. We plan to drill a well in North Dirac targeting the barrel formation based on the responses to the expression of interest for a 2000 hours per rig, we will finalize the drilling contract upon receipt of the formal extension letter from the Government of India. Dirac Gases for the current quarter is 13 million standard cubic feet per day while the uptake in the previous quarter was 14 million standard cubic feet per day.
Accordingly, sales volume of the Current quarter is 0.31 BCF compared to 0.34 BCF in the previous quarter. For our share, condensate production is 5,614 barrels compared to 5,858 barrels in the previous quarter. Price realized in the current quarter is $7.32 per mmptu compared to 7.8 in the previous quarter. While the field with an existing wells has the capacity to produce up to 45 million standard cubic feet per day, production has been constrained due to limited demand. It can be seen that IGGL has hooked up the connection up to Namligarh from Guwahati and commissioned it. It is to note that mechanical completion of the DNPL line also has been completed.
Now the connection of DNPL line with the IG line is said to be completed expected by end of March 2026. Good progress has been made. We are closely watching the development to augment our capacity to meet the increase in demand. We hope that the increase in OPIC will occur before the end of the fourth quarter of the current financial year ending 31 March 2026 or early first quarter of 2627. We anticipate the grid to be operational within financial year 2627. We will augment our capacity by drilling in North Dirac and by drilling three more development wells in Dirac.
This will enable US to increase the sales volume to meet the rising demand by connecting the Northeast gas grid to the national gas grid block AA ONHP 2017 oblique 19 which we refer to as block 19 is an area adjacent to Dirac known as a Greater Dirac and is analogous to the Dirac structure. We have received the environmental clearance. We have also secured two year extension effective December 2025 to drill two additional two drill exploration wells. Regarding the Omata block, we have 10% participating in this. In this block where IOCL is the operator holding 90% participating interest, IOCL has started drilling the first development well and he has drilled up to 4300 meters and tested needs to stimulation and this will be after completing the second well the endeavor to complete our drilling in the Northeast within two years to commercialize the discovered resources to meet the increased demand on completion of the Eastern gas grid.
Moving to our Campbell blocks we have drilled two wells in North Balol. One well flowed oil in Balol Peg which will be put on production and the second well is planned to sidetrack for Baba Group formation. With this we will have four wells on production from North Balol. We plan to drill two wells in Azzjol. We also expect to receive final clearance for the ring fenced production sharing contract along with the extension of the Palitz block. Following the extension we will install SRP in existing wells and drill additional wells in Pallid. These activities are expected to enhance the value across the Cambay assets.
Overall production from the Cambay wealth remains stable at 0.32 MMSEF of gas in quarter three financial year 26 compared with 0.33 MMA CFD in quarter two. Now I speak about our offshore blocks in Cauvery and Mumbai High coming to the Mumbai offshore blocks in case of B15 the GNC review and preparation of the development plan is in progress. Given a water depth of about 40 meters, we should be able to put the field of production within about two years. In block B80 we hold 100% participating Indus production in the current quarter is 48,742 barrels of oil and 0.4 bcf of gas come back to 31,484 68 barrels of oil and 0.23 BC above gas in the previous quarter.
During this quarter the average gas price realized is 10.5 per MMBtu compared to US$10.62 in the previous quarter. Our plan to work over the D1 well continuous and plan for drilling additional three wells in progress which will start after the forthcoming monsoon and we have sold about 417,000 barrels of crude oil to HPCL in accordance with the accrued offtake on sales agreement, title and risk transfer and incurable interest transferred to HPCL at the offshore Delivery Point. On 25th September 2025, nearly three weeks after taking the custody of the crude, HPCL raised a concern regarding the contamination.
While the COSA does not include any warranty or representation regarding the crude quality and therefore there is no basis for any claim or cost on us and we are actively pursuing all available avenues to realize the outstanding dues from HBCL Cauvery Offshore Block Based on the study by Petro Vietnam, we proposed drilling two infill wells, one appraisal well through the existing platform and one exploration well outside the platform. The project remains economically attractive even at a PPAC pricing given the minimal incremental capital requirement and the availability of substantial unrecovered costs. Moving to the quarterly results, our EBITDA for the current quarter is 31 crores in the Kansal accounts compared to 25 crores in the previous quarter.
We remain committed to drilling a total of 18 shallow wells and three depots in Carson, four wells in Duroc, two wells in Greater Duroc and two wells in each in Balij in our onshore assets to unlock the potential of our offshore fields. We plan to drill 10 offshore wells, three wells in PY1, three wells in BAT and four wells in B15. Timing would change but it is our endeavor to complete the drilling to unlock the value of all our assets. HOEC’s reserves and resource potential are estimated about 100 million barrels of oil equivalent for its share.
These resources can be developed in a cost effective manner offering substantial value creation for all stakeholders. We remain confident in our ability to navigate temporary challenges and committed to progressing our drilling program and monitoring the discovered resources and reserves and resources now. I will now hand over to Sendhil our CFO to take you through the financial results in detail.
N. S. Senthilnathan — Chief Financial Officer
Thanks Mr. Jeeva. Good morning. All standalone revenue for this quarter is Rupees 77.32 crores compared to Rupees 321.51 crores in the previous quarter which includes crude oil sale of rupees 258.78 crores from VAT field Revenue from gas sale from VAT for the current quarter is Rupees 40.22 crores compared to Rupees 22.94 crores in the previous quarter. Current quarter revenue increase in VAT is mainly due to continuous production of gas which is 401mmsef in this quarter compared to 229mmsef in the previous quarter which was impacted by monsoon disruptions in the case of Baroc. Revenue for the current quarter is Rupees 23.78 crores compared to Rupees 26.57 crores in the previous quarter.
During this quarter, 314 MMSEF of gas was sold compared to 339 MMSEF of gas sold in the previous quarter. Similarly, 5614 barrel of oil was sold in this quarter compared to 5858 barrel of oil sold in the previous quarter. The decrease in revenue is mainly due to less offtake from gas customers and margin reduction in selling prices in stand alone accounts. The field operating expenses for this quarter is Rupees 60.34 crores compared to Rupees 46.51 crores. Statutory levies are Rs. 12.44 crores for the current quarter compared to Rupees 10.6 crores in the previous quarter. Similarly, total cost without stock adjustment in the current quarter is rupees 87.7 crores compared to rupees 71.5 crores in the previous quarter.
The increase in expenses is mainly due to increase in production in VIT field. Standalone EBITDA for the current quarter is Rupees 23.89 crores compared to Rupees 28.81 crores in the previous quarter. Profit after tax for the current quarter is Rupees 11.96 crores compared to Rupees 19.04 crores in the previous quarter. In consolidated accounts, the revenue from operations for this quarter is R 81.4 crores compared to R 64.53 crores excluding crude oil share in the previous quarter. Total expenses without stock adjustment in the consolidated accounts for the current quarter is rupees 94.32 crores compared to rupees 85.95 crores in the previous quarter.
In console accounts, EBITDA for This quarter is Rupees 30.99 crores compared to Rupees 25.15 crores in the previous quarter. Consolidated profit after tax for the current. Quarter is Rupees 8.28 crores compared to Rupees 2.83 crores in the previous quarter. India Ratings has reaffirmed the rating in DA for rupees 500 crores. Bank loan with the internal accrual and continued production and with the borrowings or capital expenditure as required, we Will meet all our obligations. Thanks and back to Msajeeva.
R Jeevanandam — Managing Director
Thanks Sandhil. We can now open the forum for questions.
Questions and Answers:
operator
Thank you very much. We will love again with the question and answer session. Anyone who wishes to ask a question may press star and one on the Touchstone telephone. If you wish to remove yourself from the question queue you may press star and 2. Participants, you are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. Participants, you may press star N1 to ask a question. We have the first question from the line of Gautam Rajesh from LEO Capital. Please go ahead.
Gautam Rajesh
Hi sir. Good morning. Thank you for the opportunity. My question is what is the exact status status of the northeast grid connectivity for Dira? The PPT basically mentions that the mechanical work is done. What all is pending?
R Jeevanandam
Yes. Or between now and when the connectivity happens. See as we understand from the people whom we have talked to them that one as I told you in the last quarter itself they have connected the Gauphati to Numligarh. Now from Duliajan to Numbling. That is a DNPL existing line. They need to have 50km line is to be repaired and and that mechanical completion has been fully completed In a way that the line is ready to be connected to the IGG line at Namligar.
For that they may look for some shutdown of the refinery for some days. Once that is done then the line would get connected. That will immediately augment the say in a manner that as at the moment it is established from the outside gas can come up to Nubliger. Now the gap from Duliaja to move out of Assam that could be possible 1 this connection is made that is a shorter duration work. We expect it should be get completed by March and the augmentation of the optics should take place at least by the first quarter of the next year.
Gautam Rajesh
Understood? That will be it from my side.
R Jeevanandam
Gautam. Do you have any further questions?
Gautam Rajesh
No, that is it from my end. Thank you so much.
operator
Thank you. We will take the next question from the line of Harshit Khadka from Robocapital. Please go ahead.
Harshit Khadka
Thank you for the opportunity sir. As per our internal budgets or estimates what can be the net production for FY27 and 28 and the debt level for the same period
R Jeevanandam
2728 would be the. We are depending on the northeast grid line connected and that will increase our production by at least another threefold increase. That’s what we believe. So then we don’t intend to borrow anything for onshore developments. So that would be the immediate low hanging fruit which we can go for it. Okay, so can we expect Dirac to go to 45mm SCFD from Q1 FR27 itself and this additional gas offtake will be consumed by which customer it will go get into the grid.
You know, once it gets into the grid then it is on the anybody can consume. There is no regular customer required for you which can you can enter into any long term arrangement, short term arrangement, whatever it is. The gas supply will go up to the. Up to Azira. Right. All right.
Harshit Khadka
Thank you.
operator
Thank you. We have the next question from the line of Dhruv Ravani from Sriji Finserv llc. Please go ahead.
Dhruv Ravani
Can you give me some timelines on the work over. Well, for VAT I think we are supposed to do it but by all probabilities we should be able to in the immediately after the monsoon. So the what was supposed to happen in Feb will now happen in post monsoon?
R Jeevanandam
Yeah, I think we are trying to do that before 15th of May but by almost likely it will be happen after the monsoon. So any specific reason that we are.
Dhruv Ravani
Unable to source the rig or any further technical challenges?
R Jeevanandam
Not only source the rig and there is an onshore activities are going in a full swing in Eastern region because as we are speaking we are drilling on the wells and Carson and some resource constraints because we have to get the money from hbcl. So with this resource constraints I think we will be able to do it in the after the monsoon would be sure. And before the monsoon is little doubt.
Dhruv Ravani
Okay, and are we on track for the PY1 wells which we were supposed.
R Jeevanandam
To start in April. PY1 well we can go up to still October. There should not be any problem of drilling and people are trying to get the rig at the lowest possible rates. They are. They are trying to do whatever the best they can do to start the drilling at the earliest. As I told you, the offshore campaign is little getting delayed because of the impact of the revenue.
Dhruv Ravani
Okay, Revenue relocation. Thank you. That’s from my side.
operator
Thank you. We have the next question from the line of Sukrit D. Patil from Eyesight Venturate Private Limited. Please go ahead.
Sukrit D. Patil
Good afternoon to the team. I have two forward looking questions. My first question is beyond the production. Guidance, how will Hindustan Oil manage risk. And uncertainty in the BAT field and the drop phase Phase two development particularly around reservoir performance, regulatory approvals and execution timelines. What frameworks will ensure resilience if outputs. Or approvals don’t move as planned.Understand your point of view on this. Thank you.
R Jeevanandam
Okay, so two questions you raised. One is about the uncertainty, another one is about the risk. So we don’t find any uncertainty in this events. The risk is akin to the island gas business which is below the subsurface. That is the only risk. And the risk is more mitigated by already drilled the number of wells. So Dirac that we, we don’t have any uncertainty on. We don’t have any risk. As expected, the risk is much limited. And similarly in DAT also there is no problem on the resource, there is no problem on the reservoir.
And at the moment the government of India is pushing for drilling maximum number of wells. There would not be any constraint from the government of India to getting the approvals. So as usual some small delays here and there will take place that won’t impact the impact the operations to build the wells. Build the wells as well as polygon production. Thank you and best wishes.
operator
Thank you. We will take the next question from the line of Sabri Hazarika from MK Global Financial Services. Please go ahead.
Sabri Hazarika
Yeah, good morning. So first question is on drock. So how much production you expect it to go up to? Once this notice gas grid, DNPL connectivity happens, I think we can go to the full potential which is about 40 to 45 million cubic feet per day. And currently what is the production? 1313. Right. So.
R Jeevanandam
So this DNPL will have enough capacity to take care of your growth as well as Oil India’s own increase. Right. This will be about additional minimum about 1 to 1.25 million cubic meters per day. That itself is about say 35 to 45. So even our volume additionally assume it another 30 million. The balance is still available for additional production from Oil India. I think this will at least give us some stability and improved uptake. Right. And your I think one pipeline from your fields to the Duliajan gathering station that has been done has already been completed.
That has been hooked up for the production moved up with India and the balance line is in progress. But that isn’t going to hamper our 45 million by any means. Okay, so the evacuation for 45 million up to Dulyajan is ready from your side. Even if it is tomorrow, it’s ready. Okay. And you mentioned that March and this hookup is March and of probably Q1 of FY27 this hookup is expected. So this is subject to, I mean just a technical hookup or is there some, I mean from Oil India we have come to know that there’s some PNG RB approval also which is required to make it a common carrier, something of that sort.
But if that doesn’t come, then also this technical hookup can happen or both the things should happen simultaneously. PNG RP will give a clearance once it is fully hooked up. Okay. Once first the hookup will happen, then the PNGRB clearance will come, right? Okay. And for that NRL will have to take a shutdown also for this hookup to happen. That’s right. That should not be more than about a weekend. Right. And. And bat right now what is the, what is the guidance? Are you. Are you like giving a target in terms of increase in production or are we at this range only and trying to like reduce the impact? It will be in this range only till the workover is completed.
Okay. Those two, three wells which you are planning, after that there will be an increase in production. Is that right? This workover may improve, but till the time till all the three wells are drilled, it will be on the similar line. Okay. Got it. And last question. So what’s the assessment for Kharsang? You have 35% stake right now, correct? Okay. And what is you mentioned that you’ve got the environmental approval. I mean eight wells you have already drilled, right? And they’ve been put into production or they are being tested right now. You could listen to me that around five wells are already production and the other two wells along with the six well is completed as a gas well and it is on the same plinth.
You know, two rigs cannot work simultaneously. So the two completed wells are to be perforated and that this will happen along with the third well completion. So which we are expecting by the end of this month or 15 by all probability by 15th of March, we will be able to hook it up. Do you have a plan production plan for next say two years? How do you see the production of Kashang both oil as well as gas? This is actually a field which is having seen 28 wells are already on production which are all depleted, which are all on the old legacy wells.
These nine wells are the new wells and we are expecting the new wells can produce better. And the old wells needs to work over. Right. The production plan per se is about targeting about thousand plus barrels. Okay. With the existing one. Right. And is there any pricing upside to it in terms of new health gas or how the pricing be for this incremental gas which is coming? I think we have the government of India as a policy, but Subject to the demand. Right? Okay. Only if it is like sent to sectors like CGD and all you will get that premium pricing.
Is that right? Otherwise it is like classified as a standard gas. So maybe like it’s like at that APM rates only. Is that right? Right now has to be. Now the grid connectivity comes. It is no longer standard. So then you will be looking for all the price the premium there on. Okay. Okay. Just one last question.
operator
I would request you to rejoin the queue.
Sabri Hazarika
Yeah. Yeah. Thanks. And all the best.
operator
Thank you. Ladies and gentlemen. In order to ensure that the management will be able to answer all the questions from the participants in the question queue we request you to kindly limit your questions to two per participant. If you have a follow up question, please rejoin the queue. Again we will take the next question from the line of mehul Panjwani from 40 cents. Please go ahead.
Unidentified Participant
Hello sir. Thank you so much for the opportunity. So what is the Update on the PY3 arbitration? So it is the tribunal has been constituted. Now the tribunal will be deciding on that seat and venue. And after that they will get on to the substance of the matter. So what is the timeline for this? Any idea? Arbitration. What timeline I can give you. It is up to. The tribunal can give you the timeline. Right. Okay. Okay, sir. And how many days was BAT operational in this quarter? Sir, this quarter almost 90 days we have been operating except one or two days. It is about 89 days. Right. Okay.
R Jeevanandam
Okay. Answer this SPCL issue. What they have mentioned that it is. They have found contamination that was. That was expected to be resolved. Get resolved in the last quarter itself. So why is it such a worrying? I mean if it’s such a. We have been requesting and we continue to request and we hope some resolutions will come because our substantial money get blocked. So we wanted to have an early resolution and we have been doing all the best possible efforts and trying to talk to our people. Talk to HPCL. That’s the status.
Unidentified Participant
Now how much funds are pending?
R Jeevanandam
259 crores plus interest. Okay.
Unidentified Participant
Okay sir. Thank you so much. I’ll come back.
operator
Thank you. We have the next question from the line of Amit Mehendali from Robocapital. Please go ahead.
Amit Mehendali
I think. Thanks for the opportunity. So my first question is on the production. Net production. So if you were to move to say from our current levels of 2,500. 3,000X to say 6,000 level. What is the by field or net production that we are estimating. Can we please get numbers like Carson Bat that we split of 6,000.
R Jeevanandam
No, I think we are waiting for that. I’ve already told Karsang we will be ramp up of 2,000 barrels. And Dirac should go about to three times of the current production. These are the two immediate things. And smaller volume can come out from the Cambridge. And you cannot give the exact numbers as such. We will be wrong if I look. At the math because that way Drock will add only 600 incremental. I mean drop will become essentially, you know. Yeah. About 600 barrels. And Carson can recheck the numbers. Your math is wrong. You can recheck. We are doing 237. Right. Or 250 for Drock. So we’ll go to 750. Okay. Now how much is the. See you have to convert into the gas into oil, right? You do that, it will be much better number.
Amit Mehendali
Okay, and my second question is on the transition part. So what is the path there? And do you wish to hold your. Personal equity in the company going forward? So that’s the personal equity remains to be the company like any other investment. Okay. Now I think the NR committee and board is looking for the new CEO which you will get an announcement shortly on that. Right. So. So how long do you plan to stay with the company? Any. I mean color on the transition that will be helpful.
R Jeevanandam
Change is a lot of life. Yeah, sorry. Change is the law of life. Right, Right. Constant is the change.
Amit Mehendali
Right, Perfect.
R Jeevanandam
Yeah, sure.
Amit Mehendali
So, last question. On the EBITDA margins, maybe for 27, 28 broadly, what type of. In percentage number, what type of margins do we expect? Could be somewhere around 60%. Okay, sir, great. Thanks a lot.
operator
Thank you. We will take the next question from the line of Ritesh Gandhi from Discover Capital. Please go ahead.
Ritesh Gandhi
Hi sir, Just want to understand, you know, when we had. We had initially spoken about doing incremental actually wells after the pipeline was actually up and running. Just wanted to understand the reason why we are already starting to do it despite, you know, we were earlier expecting this pipeline to be completed in the middle of last year, then the end of this year, then early this year. And we had talked about, I mean March and April actually now given we’ve got a limited resource. I just wanted to understand the logic of. Of actually starting it given that delays appear to be actually indefinite.
It’s not the work carried out by us, it is carried by the government companies and they are the one running the. They are the ones incremental.
R Jeevanandam
I’m thinking the incremental wells which we are like we are exploring just. I thought the logic was we will start the additional exploration only after the pipeline is a complete. Given the completion of the pipeline isn’t. In our hands as you say that we are constantly drilling one well per month on an average and that progress will continue on it. Drilling is going on it and we are looking for the rig to drill the not direct, not drug. I mean there are extension he’s pending with the government of India which we get as the earliest. Once the extension comes then we have to start the drilling of the Nazirok. Okay and that is about and Cambay we have drilled two wells in balloon and we are waiting for the extension of the college and as well as the ring fenced are received from the government of India.
Once the extension comes then we can ask our partners to put the money and we can start building.
Ritesh Gandhi
Okay sir, and you know if you could sort of explain this HPCL issues slightly in a detail because I think strange that they will take the oil without actually really testing it and then you know, given that they’ve actually made a large release that the refinery was closed down and on the tip conference call also sort of indicated it was all a link to our oil. Just you know, if you could give a little bit incremental granularity on what the issue is how the resolution is expected and the exact status right now because obviously it’s going to impact our future capex.
And is there any risk of this happening with other oil which is produced in the bat?
N. S. Senthilnathan
So one thing is that there is no risk associated with the production of any oil from any of our fields. That is the first thing. Second thing, normally we sell the oil on FOB basis. You fully aware FOB basis means the risk and the risk insurable interest and the title transfer to the buyer, it is not with the seller. The buyer takes the delivery of the crude and putting into the tanker and then blending it with the other crudes and then using into the refinery. And that’s what has happened in this case. So we are requesting these EU happening the transfer of the title.
So as well as we are concerned the sale is fully completed and the amount is due to us. They are saying your aisle is having some contamination but we do not know we are not responsible for those contamination if any or anything anywhere it happened. So we are open and transparent and we have told them these are the aisle we are going to sell and that accordingly we transfer to that tanker which has gone and taken by them and blended by them and refined by them. Now we are requesting them kindly release our payment Our request will continue to be with hpcl.
Ritesh Gandhi
That’s all from our side.And have you taken any legal action against them?
R Jeevanandam
Actually that is so whatever the legally they asking we are replying on legal manner. That’s all. And we are wanted to have amicable resolution this. And if that happens it is well and good. If nothing happens then that is the last resort. Right.
Ritesh Gandhi
And typically how long do these things legally take? Suppose it goes down the legal route. How long do these things.
R Jeevanandam
In the course of any arbitration on this should be dealt within a period of four months.
Ritesh Gandhi
Got. But we’ve not started with the arbitration.
R Jeevanandam
No, no. We have no intention of doing anything on this thing. We want an amicable settlement. They are after all our big brother. We have to deal with them in the subsequent period. Also we don’t be in a litigation mode in life.
Ritesh Gandhi
Got it sir. And so we are hopeful. It’s like close to being resolved.
R Jeevanandam
I think we hope and we pray for that. Okay.
Ritesh Gandhi
Okay. And on Kharang, if you could expand on the potential we have from Kaz and how we are looking at the opportunity there.
R Jeevanandam
So Kashang, as you see there is a well control issue. One of the well drilled. And that means the potential of the gas is substantial enough to connect to the grid line. So Oil India is interested to drill additional number of more number of wells. So we will be on a continuous mode of drilling there. And the deeper prospects also. And this will unlock substantial value on the block. That’s what we believe in. And every well would be adding at least about 100 barrels per day additional production. And if the gas are get we are expecting even by perforating the shallower part of the existing wells and some other one or two new wells we can go up to a minimum of 10 million cubic feet per day.
Ritesh Gandhi
TGot it. Thanks.That’s all.
R Jeevanandam
Thanks.
operator
Thank you. We will take the next question from the line of Rajiv Agarwal from Sterling Capital. Please go ahead.
Rajiv Agarwal
Thank you for the opportunity. Some data questions. What is the conversion factor you use to convert gas into nine barrels of oil? That is my first question. And my second. Question. Can I answer then before ask the second question? Yeah. Six thousand. Six thousand standard cubic feet is roughly equal into one barrel of oil. Okay. Okay. Okay. And now second question. Second question. Sir, if I see the consolidated PL s this revenue has declined from the last year 81 from one hundred and fifty six to eighty one. So I just want to understand what is happening there.
R Jeevanandam
This is mainly due to the reduction on the Dirac optic as well as the bat both were not performing as expected. Okay. Okay. Thank you.
Rajiv Agarwal
Thank you.
operator
Thank you. We will take the next question from the line of Mirbai Mahavar from N Square Kafka. Please go ahead.
Unidentified Participant
What is the net debt or cash in the book? 55 crores as a yes on date. 55 crore debt or cash?
R Jeevanandam
55 crore debt and the cash is about 30 crore cash is there. And would it be fair to assume based on current expectation that zero production next financial year would be at least double of this year. Would it be fair we expect triple of this year for next financial year FY27. So. So we would be expecting around 40,000 MMBTU daily production.
Unidentified Participant
That’s right. Okay, thanks.
operator
Thank you. We will take the next question from the line of Anubhav Goel from Cosmo Ventures. Please go ahead.
Anubhav Goel
Sir, if I heard you right, if the hpl, if the HPCL issue is not resolved in the next three to six months and we don’t get the money then we would mostly delay the drilling for PY1 and B80 post monsoon.
R Jeevanandam
I think. See once the money is get then you have to look at other options of raising funds. Right? Right.
Anubhav Goel
This is the October timeline you mentioned for PY1. That is independent of the HPCL issue.
R Jeevanandam
That is independent of the HPCl issue. We are trying all possible. See once an issue is there for a substantial blockage of the revenue and every day you look at actually you may realize it. Now we come to your state when you can’t realize it will take more time then that point in time you have to look for alternative source of funding. Right.
Anubhav Goel
This would mean you would take on more.
R Jeevanandam
More debt or are we more open to equity as well after the more to have a look at it. And both options are open at the moment.
Anubhav Goel
And so the. You mentioned the new C. The new CEO. Do we expect him or her to come within the next three to six months?
R Jeevanandam
I think much earlier than that I hope.
Anubhav Goel
All right.
operator
Thank you. We will take the next question from the line of Prashant Daya, an individual investor. Please go ahead.
Unidentified Participant
Yes sir. First question. Wanted to understand you know on the HPCL issue only you know in the current scheme of things how much does. It delay our plans? And secondly, do we also have what is the amount of fuel do we have on the floating storage vessel? I mean is there an option to sell more?
R Jeevanandam
That’s one. Yeah. I don’t think we have got an immediate option to sell anything on store. That is. That’s ruled out in the overall, in my opinion it should. I may be wrong. It should be much earlier but it will delay the whole process by about four to six months.
Unidentified Participant
Yeah. Okay. So second question is on B15. I mean we had spoken about about a year back that you know once discovery was there that take about two years, you know for us to start realizing now given that we have 100% participating interest in this and it’s a shallow field etc. And there are already some wells there. I mean are we more aggressive? What is the. What is our. Because this could be a significant revenue changer for the company in the mid to long run. So where are we with the development plans and environmental clearances etc.
R Jeevanandam
I think we have already waiting for the mining lease once that is expected shortly. Once the mining lease comes and we will. Our people are already working on the development plan that will be given to the government of India for approval. After that we will start placing orders for the materials and things record in a slow and steady manner. So in a manner that we will be able to put the field on production within about two years from the submission of the development plan.
Unidentified Participant
Sir, overall are you happy with the. You know as management are you happy with the last couple of quarters production and the way things are going? Really the Stock is almost 50% down from a year. So what is your like management view in terms of you know development, all the fields and the progress that was committed versus what is actually happening on the ground.
R Jeevanandam
So I’m not happy about it. That is. That’s for sure. The one is even because you are able to produce, you are not able to sell. And second thing you are continuing with the capital commitments and the bit is not performing as expected. This these are the more of an issue the surface issues which has to be resolved. Till the resolution comes some of the things are not within our hands to do it. So till all these things are getting resolved we are not able to achieve what we are expecting. There are gaps and these are the gaps are getting filled up now.
So we will be able to do much better once the grid connectivity comes into play.
Unidentified Participant
Thank you for the transparency. All the best.
operator
Thank you. We will take the next question from the line of Manan Patel, an individual investor. Please go ahead.
Unidentified Participant
Am I audible? Yes. Hello. Good morning sir. First question is regarding the. Just wanted to understand the accounting because if I see the difference between standalone and console the revenue is just 4 crores. While I understand Karsung and the subsidiaries like Hindage and all those comes is consolidated apart from Standalone. So I would have assumed that revenue in standalone would be much higher than just 4 crores. So can you throw some light on that?
R Jeevanandam
I think one and clearly I have I seen what is happening is they are asking us to some of those that might be the one of the issue for it.
And you can send me that questions. I can. Because after cuff I am not able to answer to you clearly. I will. You can give me a call and I will go through the numbers and explain to you. Okay. Okay sir. And sir, second question on. On Karsang. So you mentioned thousand plus barrel. So is that only oil or that is including gas? Because you said gas. Okay. Okay. So once gas connectivity is there you can produce a lot better in Carson as well, right?
Unidentified Participant
That’s right. Okay. Thanks a lot sir. I’ll. I’ll get in touch with you. Thanks.
operator
Thank you. We have the next follow up question from the line of mehul Panjiani from 40 cents. Please go ahead.
Unidentified Participant
Hello sir. Thank you so much for all the responses. One update which I missed out is maybe I. I was not there in the commentary. So can you please brief on the new CEO and changes in the management.
R Jeevanandam
I think NRC what we call the nomination remuneration committee and the board is discussing with the people and they will come out with the the new CEO. We will announce it. Actually.
Unidentified Participant
Sir, are you taking a different position at the executive level Or.
R Jeevanandam
Or are you? I won’t be. And I won’t be in any executive position.
Unidentified Participant
You are living your position, is it?
R Jeevanandam
I will not be in this position. But sir, there has not been any. Update to the stock exchanges. Has this been announced only in the during the call today on. It has been already announced in the exchange long time. But Jan 22. Okay.
Unidentified Participant
So how long will you be able to continue.If the new CEO comes?
R Jeevanandam
This is very clear in the message actually to the stock exchange. Okay. Sorry sir, I have no doubt. And sir, about the bat.
Unidentified Participant
As you said that you know it is not performing optimally.
R Jeevanandam
So how would we rate the performance of the VAT currently? Is that what we are struggling with? That we need to have a workover of the well and that is getting delayed. Once the workover is done, the D1 will. D1 well will do much better. And the D2 well as usual need the zone transition and both the things we could do it and it will be doing much better than what we expect. What is the current league?
operator
Sorry to interrupt me. I would request you to rejoin the queue again.
Unidentified Participant
No, this is just a follow up Question on the zone.
operator
Thank you.
R Jeevanandam
Okay. Okay.
operator
Next question. We have the next follow up question from the line of Anubhav Goel from Cosmo Ventures. Please go ahead.
Anubhav Goel
So the approval now for the next nine wells for Karfing you mentioned we have to take partners approval. Any, Any. Any color you can provide on this.
R Jeevanandam
So we have. We are ready to drill the wells. But we are only 35%. The balance 65% approval is expected as we speak. We have already circulated the operating committee approval for the nine wells are immediately almost six wells and then followed by another three wells little later. But the budget is proposed for the nine wells and one deeper value.
Anubhav Goel
So this is something we have recently submitted to the partner.
R Jeevanandam
Discussion. And we have to finalize the location. After finalizing the location we have submitted to the partners. Thank you.
operator
Thank you. We have the next question from the line of Radish Gandhi from Discover Capital. Please go ahead.
Anubhav Goel
Hi sir. You know you had indicated that you needed an extension on fsat. Just wanted to understand is there. Is this just procedural or is there any risk attached to it or how should we be looking on that?
R Jeevanandam
There is no risk attached. It has been already approved by dgh. It is in the regular procedural issue at the ministry. Nothing else.
Anubhav Goel
Got it.
R Jeevanandam
Okay.
Anubhav Goel
And, and, and this will happen after the pipeline or it’s independent of when.
R Jeevanandam
This has nothing to do with the pipeline or anything. It is just a procedural thing and which we have been pursuing with the ministry. It may be expected any moment.
Anubhav Goel
Okay, sir, thank you. That’s all for me. Thanks.
operator
Thank you. We have the next follow up question from the line of mehul Panchwani from 40 cents. Please go ahead.
Unidentified Participant
Thank you so much for the follow up opportunity. Sir, you were saying something about the zone transition. If you can elaborate, it will be helpful for D2.
R Jeevanandam
What has happened was in D2. Well, we have perforated the gas zones. Now there are other three zones on the top. Once the gas zones started depleting on that then we have to perforate on the top zones which will also produce island gas. Right. So this will be normally being done during the workover.
Unidentified Participant
And so we expect to finish all the work over by October 2026.
R Jeevanandam
I think if you are not able to do anything on this season, then the next season starts end of October. From October to April we can do that work. Right, sir.
Unidentified Participant
And sir, I heard you about the Drock offtake that it can be triple of what we are doing right now. So what would be the timelines we.
R Jeevanandam
Can expect on the that one. Yes, we are ready with the six well production and that six well can be five wells and the six well six can be hooked up for production. Once the line. Once there is a demand access. Right now the demand will increase only when the grid connectivity is over. So which will be on a day’s job. Right. So the demand is there. It is a day job. Okay. So as soon as the demand is there we are kind of ready for the uptake. Right sir. Okay.
Unidentified Participant
Thank you so much, sir.
R Jeevanandam
Thank you. Thanks a lot.
operator
Thank you very much. Ladies and gentlemen, as there are no further questions from the participants I now hand the conference over to Mr. Jeevanandam for closing comments.
R Jeevanandam
Thank you all for joining this call. Our onshore drilling program is progressing well and we intend to maintain this momentum as we work to unlock the full value of our onshore assets. We will commence our offshore drilling campaign once the temporary operational issues are resolved. Given the substantial underlying resource potential, these time challenges do not diminish our long term value creation outlook. Thank you.
operator
Thank you members of the management, on behalf of Hindustan Oil Exploration Co. Ltd. That concludes this conference. Thank you all for joining us today. And you may now disconnect your lines.