ONGC misses production targets as key projects face fresh delays
The state-owned explorer produced 18.355 million metric tonnes of crude against a 21.5 million tonne target, while KG-98/2 and Daman projects slip further.
— 3 earlier stories on Oil & Natural Gas Corporation Ltd. →What's new
- Crude production missed guidance by over 3 million metric tonnes.
- Peak production at the Daman upside project is now pushed to 2027.
- KG-98/2 oil output dropped to 24,000-25,000 barrels per day.
Why this matters
Operational misses at ONGC are becoming a recurring theme. The combination of geological surprises at KG-98/2 and timeline slippage at Daman suggests that the company's growth projects are struggling to meet their original technical and schedule expectations.
What we're watching
- Whether the company revises production targets for FY25.
- Updates on the drilling progress at KG-98/2 over the next year.
- Any further delays to the mid-2026 gas monetisation timeline.
The full read
ONGC missed its production targets for the year ended March 31, delivering 18.355 million metric tonnes of crude oil against an initial guidance of 21.5 million tonnes.
Growth projects are faltering.
The Daman upside development project is now slated to reach peak production in 2027, a one-year delay from prior estimates, while the KG-98/2 block is facing geological surprises that have pushed oil output down to 24,000-25,000 barrels per day. Management expects to spend another year drilling before seeing a reversal in output, and gas monetisation for the block is deferred to mid-2026. These operational setbacks are clear, but they do not pose a threat to the company's long-term viability. The open question is whether these geological and project-management hurdles will force a more conservative production outlook for the coming fiscal year.
Questions answered
- How large was the production miss for the year ended March 31?
- ONGC produced 18.355 million metric tonnes of crude oil, falling short of its initial guidance of 21.5 million tonnes.
- What is the status of the KG-98/2 block?
- Oil output has declined to 24,000-25,000 barrels per day due to geological surprises. Management expects to drill for another year before output reverses, with gas monetisation delayed until mid-2026.
- Has the timeline for the Daman upside development project changed?
- Yes, peak production is now expected in 2027, which is one year later than the previous forecast.
- Do these setbacks threaten the company's financial stability?
- No. While the operational misses are material, they do not threaten the company's financial stability or long-term viability.
Story so far
All notes on ONGC →- 27 May 2026 · 12:47 PM IST ONGC misses production targets as key projects face fresh delays
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