NOTES:

* Represents consumption of stores & spares
** Also includes depletion, amortisation
*** Reserves excluding intangibles

1. The Audited accounts are subject to review by the Comptroller and Auditor General of India under Section 619(4) of the Companies Act, 1956.

2. The Corporation has changed the accounting policy on abandonment costs on the basis of Unit of Production Method during the year retrospectively w.e.f. 1.4.1999 when it started recognising such costs. The same were earlier being provided for equally over a period of fifteen Years. As a result of this change, the profit before tax for the year is lower by Rs. 170007 lakhs.

3. The Corporation has finalised crude oil sale agreement with PSU refineries w.e.f. 1.4.2002 (execpt HPCL) during the quarter ended 31st March, 2003; accordingly, the difference between the crude oil sales revenue provisionally recognised on the basis of March,2002 prices and prices now finalised has been accounted for in sales revenue for the quarter ended 31st March, 2003.

4. Sales Revenue in respect of Crude oil is based on agreed prices with the customers, except for sales to HPCL amounting to Rs. 372353 lakhs which is based on the draft crude oil sale agreement with HPCL.

5. The statutory auditors in their report on the accounts for the year 2002-03 have commented as under :-
(i) Non-consideration of depreciation as a charge to Profit & Loss Account being allocated to assets to be depleted and for the purpose of quantifying the depreciation under Section 205 of the companies Act, 1956.
(ii) Incorporation of unaudited figures of joint venture projects and NELP blocks respectively in the books of the Corporation.
(iii) Overdue amounts aggregating Rs. 21094 lakhs; on the basis of available information, they are unable to form any opinion on the recoverability of these dues.
(iv) Accounts pending reconciliation - the adjustments/provisions, if any, required to be made.
(v) Segregation of outstandings of Small Scale Industries( SSI) from the creditors' balances, for which they have placed reliance on the certificate issued by the Management.

Comment No. (i) (ii) & (v) do not have any impact on the financial results for the quarter as well as for the year. In respect of comment No. (iii), Management is of the opinion that the overdue amounts are good and realisable. In respect of comment No. (iv), effective steps are being taken for reconciliation of these accounts. Management does not envisage any significant impact on the above financial results.

6. The Board of Directors have recommended a dividend of Rs. 30.00 per share (inclusive of Rs. 17.00 per share already paid as interim dividend) subject to approval of shareholders in the ensuing Annual General Meeting.

7. The Consolidated Financial Results consist of results of ONGC and its subsidiaries, ONGC Videsh Ltd - a wholly owned subsidiary, ONGC Nile Ganga BV w.e.f. 12.3.2003 (wholly-owned subsidiary of ONGC Videsh Ltd.) and Mangalore Refinery and Petrochemicals Ltd. which became a subsidiary of ONGC w.e.f. 30th March, 2003. Hence the consolidated results for the previous year are not comparable to this extent.

8. The above results have been taken on record by the Board of Directors at its meeting held on 23rd June, 2003.


(R S Sharma)
Director (Finance)

Place : New Delhi
Date : June 23, 2003