Oil India Limited

Oil India LimitedPresentation

Strictly Private and Confidential

May, 2013

Oil India: Brief Overview

Strong Financials

Strong Reserve Base

Integrated O&G Player

Large Acreage

Rich Heritage

Total 2P reserves of over 941 mmboe; with reserve replacement ratio of over 123% in FY12

Presence across Oil & Gas Value Chain (E&P, Transportation and Downstream)

World Class Infrastructure to support growth

Domestic acreage: 86,729 sq. km over 58 blocks International acreage: 38,944 sq. km

Market cap : Rs. 35,366 cr * FY13 Total Revenue: Rs 11,456 cr FY13 PAT : Rs. 3589 cr

Independent India’s first commercial oil discoveries, with the first one being made in 1953

India’s Premier Oil & Gas “Navratna” Company Engaged in the Exploration, Development,Production and Transportation of Crude Oil and Natural Gas in India

22

* Market cap as on 27.05.13

OIL Shareholding Structure

Source: Company Reports.(1) Shareholding data as on 27.05.2013(2) The share price data has been adjusted for the bonus issuance

Listed on BSE / NSE

Market Cap: Rs.35,366 crore

Share price (52 Week High / Low) : Rs.618 / Rs.431

Number of shares: 601.12 mn

Key shareholders % Shareholding

Indian Oil Corporation 4.45%

Bharat Petroleum Corporation 2.23%

Hindustan Petroleum Corporation 2.23%

HSBC Bank (Mauritius) Ltd. 2.68%

HDFC Standard Life Insurance Company Limited 1.04%

HDFC Trustee Company Limited-Top 200 Fund 0.90%

HDFC Trustee Company Limited- HDFC Equity Fund

0.84%

ICICI PRUDENTIAL LIFE INSURANCE COMPANY LTD

0.76%

GOI68.4%

Others16.0%

DII7.9%

FII7.7

Dividend FY131st Interim Dividend/Share: Rs.11.002nd Interim Dividend/Share: Rs.12.00

Final Dividend/share: Rs.7.00

1959 1961 1962–1963 1981 200419991982 2008 2009–2013

Evolution and Key Milestones

LPG plant set-up using Turbo Expander Technology

Formed as a JV with Burmah Oil Company

Transformed into equal partnership JV company between Burmah Oil Company and Government of India

Became a wholly owned Government of India enterprise

Participated first time in NELP

NRL-Siliguri Product Pipeline (660km) commissioned

OIL enters the field of installation, commissioning and maintenance of Crude oil pipelines

Completed construction of a 401km pipeline from Duliajan to Guwahati and a 756km pipeline from Guwahati to Barauni

Entered into a MoU with IOCL for pursuing overseas exploration and production opportunities

IPO in September 2009 raising a total of Rs.27.7 bn

Received Navratna status

10% OFS by GOI

"Company of the year" among all Navratna and Miniratna companies at the PSE Excellence Award

E&P Company of the Year Award by Petrofed for the year 2010-11

Wind energy project commissioned

44

Integrated Oil & Gas Player

NRL – Numaligarh Refinery Limited. BCPL – Brahmaputra cracker and Polymer Limited. DNPL – Duliajan-Numaligarh Pipeline Limited.

PSC for 3 blocks has been signed under NELP IX

Transportation DownstreamProductionExploration

Crude Oil

– 1,157 km pipeline

~6MMT capacity

Multi-product

– 660km pipeline;

1.72MMT capacity

Overseas Pipeline

– 10% stake in 741km

pipeline (Sudan)

Natural Gas

– 23% stake in 192 km

DNPL in North East

Refining & Marketing

Petroleum Products

– 26% equity stake in

NRL

Gas Cracker Project

– 10% equity stake in

BCPL

City Gas Business –

– Signed MOU with

GAIL, HPCL, IOCL and

BPCL/ONGC

50 years of experience

Advanced recovery

techniques to maximize

production

FY’13 Produced 3.7

MMT of Crude oil:

– 39 installations

– 1,544 km pipelines

FY’13 Produced 2.64

bcm of Natural Gas:

– 26 installations

– 583 km pipelines

Domestic: 65 E&P

blocks

International: US,

Venezuela , Gabon,

Egypt, Iran, Libya,

Nigeria, Timor Leste, and

Yemen

New Discoveries: 19

Small to medium size

discoveries (reserve size

less than 30 mn bbls)

during last three years

(FY10–12)

55

Our Vision

Fastest Growing Energy Company with Highest Profitability

Delight Customers with Quality Products and Services at Competitive Prices

Learning Organization, Nurturing Initiatives, Innovations and Aspirations with Best Practices

Team, Committed to Honesty, Integrity, Transparency and Mutual Trust creatingEmployee Pride

Fully Committed to Safety, Health and Environment

Responsible Corporate Citizen Deeply Committed to Socio-economic Development in its Areas of Operations

“The Fastest Growing Energy Company With a Global Presence Providing Value to Stakeholders”

66

Strategic Plan 2020-21

2012 2020

Growth

Decades of Experience 77

Maintain & Enhance Reserves & Production from Current Fields Maintain & Enhance Reserves & Production from Current Fields

Inorganic Growth (India and Overseas) Inorganic Growth (India and Overseas)

Vertical Integration Along the Oil & Gas Value Chain Vertical Integration Along the Oil & Gas Value Chain

Selectively Diversify in Alternative Energy Selectively Diversify in Alternative Energy

Diversify into Unconventional Hydrocarbons Diversify into Unconventional Hydrocarbons

Be World Leader in the Field of IOR / EOR Be World Leader in the Field of IOR / EOR

Accelerated Exploration Initiatives Accelerated Exploration Initiatives

46.1

15

346 364 381415

445

524 559

480

FY04 FY05 FY06 FY07 FY08 FY09 FY10 FY11

CAGR 10.4%

Source: BP Statistical Review of World Energy, June 2012.

Domestic Industry Environment

Significant Supply Deficit in the Domestic Market (1)

Total Consumption162.3

75.1%

61.1

24.5%

Crude Oil (mmtoe) Natural Gas (bcm)

Deficit Production

Source: BP Statistical Review of World Energy, June 2012.

(mmtoe)

Steady Growth in Domestic Energy Consumption Driven by India’s Economic Growth Story

Energy Sources

(%)

Energy Sources – India

Energy Sources – Global

Natural gas10%Coal

53%

Oil29%

Hydro electricity5% Renewables

2%Nuclear energy1%

Natural gas24%

Nuclear energy5%

Renewables2%

Hydro electricity6%

Oil33%

Coal30%

40.4

121.9

(%)

Deficit

Deficit

88

Robust Domestic Fundamentals

(1) Source: MoPNG.(2) Source: BP Statistical Review of World Energy June 2012.(3) Source: DGH, HEDA report 2010.

36

125

Gas Oil

BCM mmbpd

Among largest net

importers of oil globally

Dependence on

Imports in past decade

Only 22% of India

well explored (as of

31 March 2011)

0.65% of World’s

Oil reserves (2)

0.77% of World’s

Gas reserves (2)

India - the 4th largest

Energy consumer in

world (2)

Robust long-term

consumption outlook

Strong Domestic Demand

India Remains a Net Importer of

Crude (1)

India – A Fraction of Global

Reserves (2)

India – Significantly

Under-explored (3)

% of Total Oil ConsumptionDomestic Consumption Outlook

2030

2005

India: Exploration Status

FY2011

4.3

2.6

Explored22%

Un-explored

12%

Initiated Explor'n

44%

Poorly Explored

22%Imports81%

99

PEL Nomination

1,445

PML Nomination

5,095JV/PSC (NO)

316

NELP (Operator)

18,464NELP (NO)

61,296

Overseas (PI)38,749 CBM

113

Domestic Asset Overview

Blocks Op N/Op Total

NELP 12 15 27Pre-NELPJV - 2 2PEL (Nom) 7 - 7PML 21 - 21CBM - 1 1Total 40 18 58

Source: Company information.NO – Non-operatorPI – Participatory Interests

30%

85%

25%

10%

50%

85%

15%

10%

40%AA-ONN

20%

10%

90%KG-ONN

20%MN-DWN

40%

40%

30%

20%KG-DWN15%KGDWN

AN-DWN

AN-DWN

KG-OSN

Strongpresence inprospectiveEast Coast

+

60%RJ-ONN

75%RJ-ONN

20%AA-ONN

NELP I-VIII

Nomination ML(s) / PEL(s)

JVC Blocks

OIL as Operator

Joint+

Total Area – 125,478Sq km

AA-ONN

AA-ONN-2009/4

AA-ONN

16%AAP-ON

AA-ONN

AA-ONN

MZ-ONN

WB-ONN

KG-DWN

KG-DWN

AN-DWN

AN-DWN

AN-DWN

10%

30%

30%

MN-OSN

ASSAM +AP

30%GK-OSN-2010/1

AA-ONN 40%

ASSAM +AP

Map Not to Scale

Significant India Presence in Regions with Proven Commercial Production or Known Accumulation of Hydrocarbons

CY-OSN-2009/2 50%

AA-ONN-2004/2 100%

Kharsang 40%

AS-CBM2008/IV 40%

AA-ONN 50%

1111

With Dominant International Footprint

6,725sq.km2,600sq.km

25%(GSPC)

EGYPTBlock 3Block 4

3,500sq.km

20%(OVL)

IRANFarsi Offshore

50 sqkm20%

USColoradoJulesburg Basin

1,295sq.km

17.5% (Summit)NIGERIAOPL 205

3,761sq.km45%GABON Shakti

203sq.km180sq.km

3.5%

VENEZUELACarabobo 1 NorthCarabobo 1 Central

1,853sq.km364sq.km

12.75% (Medco)

YEMENBlock 82 Block 83

Total Area –38,749sq.km

741sq.km 10%SUDAN Pipeline

Operator

Area (Sq. km)

OIL’s Participating Interest (%)

Dominant International Footprint with Balanced Presence in Exploration Acreages & Producing Properties

1212

1,788sq.km

12.5%(Reliance)

TIMOR LISTEBlock K

7,087sq.km2,710sq.km6,629sq.km

50%50% 25%(Sonatrach)

LIBYA Area 86Area 102/4Area 95/96

Major Projects

MizoramMZ-ONN-2004/1

(NELP-VI)

Gulf of Mannar CY-OSN-2009/2( NELP-VIII) –

Block Shakthi (Onshore Gabon,

West Africa)

Project Carabobo (Onshore, Venezuela)

Area: 3,213 Sq. Km

Pre-drilling in progress, 5 locations released for drilling

1352 LKM of 2D seismic survey completed.

3D survey expected to start soon.

Area: 1,621 Sq. Km

Processing of acquired data completed.

Data sent for Interpretation.

2D API 511 LKM, 3D API 1621 SQKM and three well 2D and 3D acquisition and processing completed.

Area: 3,761.65 Km²

Less explored, geo-politically stable, oil-rich country

2 locations released for drilling

Drilling of third well is in progress.

Area: 549 Sq. Km

Pre-drilling in progress, 4 locations released for drilling.

Drilling of 1st well expected to start by June end.

KG BasinKG-ONN-2004/1 (

NELP-VI)

Two blocks (383 sq. km) in Orinoco heavy oil belt in Venezuela.

Production from first well started in December,2012

Current production from three well is 1800 bopd.

Overseas acquisitions – Focus and Available Resources

Balanced overseas portfolio

Acquire producing/development

/discovered blocks

Both, Oil & Gas – Offshore/Onshore

Individual Target Production level upto

30,000 boe/d

Operatorship in On-shore blocks

Joint operator/Active non-operator in

off-shore blocks

Dedicated Multifunctional Team pursuing

M&A opportunities

Utilising Expertise of International M&A

Advisers and Technical consultants to

identify and pursue opportunities

Adequate Knowledge Base/

Technical and Commercial capabilities

across Organisation

Strong Financial Resources

(Cash/Borrowing Capability)

IOCL as Partner – International network/

complete Value chain

Active and Focused Management Support

for M&A

Focus for Overseas acquisitions Available Resources

1717

International Acquisition Strategy

International Strategy

Prepared by International consultants and adopted by Board

Seek to acquire exploration acreages / producing properties

Employ capital in the midstream and downstream, limited for

the purpose of creating additional value in the upstream

A Two Period Strategy:

OIL focuses its international efforts to:

– Launch platforms for international core areas

– Acquire companies/enter partnerships as a non-operator

– Build skills in new onshore, offshore and gas plays

– Make organizational change to operate assets

– Sustain its core areas as an Asset manager

– Acquire companies and enter partnerships to grow its

core areas launched in Period I

– Develop partnerships with technology companies to

achieve efficiencies

International Partnerships and Alliances

Implement its acquisition strategy utilizing joint ventures with other leading players in the industry

Partnering strategy with potential midstream and downstream investments in order to retain focus on capital employed in E&P

Su

stai

n a

nd

Gro

w

Per

iod

Bu

ild P

erio

dS

ust

ain

an

d G

row

Per

iod

1818

Significant Reserve Base and Production Scale

Total Reserves (1) Proved and Developed Reserves – Split by Type

Consistent Reserve Replacement Ratio Over One Steady Production Growth

(mmbbl)

Source: Company InformationNote: (1) Data as of April 1, 2012.

Proved developed reserves of approximately 225 mn barrels and natural gas reserves of 199 mn barrels

2.041.69 1.65 1.42 1.23

FY08 FY09 FY10 FY11 FY12

Crude OIL

5.10 5.60 5.90 5.90 6.8410.30 9.40 9.70 8.40 8.41

FY08 FY09 FY10 FY11 FY12Production Accretion Accretion

1P Reserves represent:

10 Years current production of Crude Oil 12 Years current production of Natural Gas 11 Years current production of O+OEG

1919

473

8.10

11.04

12.72

20.21

FY08 FY09 FY10 FY11

2.62

4.26

3.46

4.47

5.19


IOR/EOR Initiatives

Improvement in Production

(in mm bbl)

2626

Improvement in crude oil reserve

(in mm bbl)

OIL has made investments in excess of Rs.2425 crore in IOR/EOR initiatives during last five years

Excellent Oil and Gas Infrastructure

Two 2D and One 3D Seismic

crew

Six Logging Trucks

14 W/over Rigs11 Drillings

Rigs

72 Production Installations

5,000km O&G Pipelines

~150k KL Crude Storage

Source: Company presentation

Infrastructure to Support E&P Activities Production and Storage Facilities

In-house Expertise and Integration across Energy Infrastructure

2020

Presence Across Value Chain

In-House Expertise

Seismic APISeismic API(2D and 3D)(2D and 3D)

DrillingDrilling

WirelineWirelineLoggingLogging

FieldFieldDevelopmentDevelopment

ProductionProduction

TransportationTransportation

IOR/EORIOR/EOR Field/Reservoir Field/Reservoir ManagementManagement

OIL is a fully self-serviced E&P company

2121

OIL intends to continue an active strategy of vertical integration into downstream sectors such as refining, processing, distribution and retailing, cracking and fractionation of gas

This vertical integration strategy is aimed at to achieve following objectives

– Diversification of revenue sources

– Improving profitability by extending operations into higher-margin segments of the product value chain

26% equity stake in Numaligarh Refinery Limited (NRL).

The other equity holders in NRL are BPCL and the Government of Assam

26% equity stake in Numaligarh Refinery Limited (NRL).

The other equity holders in NRL are BPCL and the Government of Assam

MOUs with HPCL, BPCL, ONGC and IOC for laying, building, operating or expanding city gas distribution networks.

Commissioned Wind Energy Project in Rajasthan.

LNG: MOU with Kakinada Seaports

MOUs with HPCL, BPCL, ONGC and IOC for laying, building, operating or expanding city gas distribution networks.

Commissioned Wind Energy Project in Rajasthan.

LNG: MOU with Kakinada Seaports

10% equity stake in Brahmaputra cracker and Polymer Limited (Assam)

Process natural gas, naphtha or any other petroleum product

Distribute and market petrochemical products in India and abroad

10% equity stake in Brahmaputra cracker and Polymer Limited (Assam)

Process natural gas, naphtha or any other petroleum product

Distribute and market petrochemical products in India and abroad

Refining and Marketing City Gas / LNG projectsGas cracker Project

Downstream Operations

2222

13.017.3 15.5

9.4 10

.4

17.1

8.6 10

.8

16.7

0.3 0.6 0.9

FY10 FY11 FY12

Corporate Tax Cess Dividend Others

Strong Government Linkage

Government Owned Enterprise and continued government support evidenced by the recently awarded

“Navratna” status to the company making it more autonomous.

2nd Largest Public Sector E&P company

– Contributed Rs.68 bn to the exchequer in the FY2011–12

Management Independence

– A Navratna company with liberty to take financial decision upto Rs.10 bn, ability to raise Rs.30 bn

– Board power has been enhanced to USD 600mn for acquisition.

Contributions to Exchequer

(Rs. in bn)

Note: (1) Others include Service Tax, Custom Duties. (2) Others include PEL Fees and Electricity Duties.Note: (1) Others include Service Tax, Custom Duties. (2) Others include PEL Fees and Electricity Duties.

Central GovernmentCentral Government State GovernmentState Government

11.5

13.5

13.4

3.5 5.

0 5.0

0.2

0.1

0.1

FY10 FY11 FY12Royalty VAT/Sales Tax Others

(1)(1)

31.331.3 39.139.114.214.2 15.215.2 18.618.6

39.139.1

2323

Plan outlay expenditure

1210

1632 15571743

2050

2890

FY08 FY09 FY10 FY 11 FY 12 FY 13

Rs/crore

21

32

FY13 FY14

1,795

500

FY13 FY14

XIIth 5year Plan: Rs.1,90,030 mn

3D Seismic Surveys Development DrillingExploratory Drilling

19

38

FY13 FY14

Significant Investment Lined Up

Annual Plan 2013–14: Rs.35,809 mn

Exploration32%

Development21%

Capital Equipment

17%

Overseas17%

Investments1%

Survey12%

Substantial Increase in Exploratory and Development Drilling Planned

2424

No. of wellNo. of wellSq km

Operating Performance

2525

2,415

2,352

2,633 2,639

FY10 FY11 FY12 FY 13

25.5725.67

27.53

26.21

FY10 FY11 FY12 FY 13

Crude Oil and Natural Gas Production

Crude Oil Production Natural Gas Production

(in mm scm)(in mm bbl)

2626

Attractive Cost Structure

(US$/boe)

OIL has the Advantage of Low Finding and Development Costs

OIL's integrated oil and gas infrastructure enables the company to manage costs efficiently by optimizing manpower costs, using in-house services, adapting cost-saving technology, effectively using geological data and expertise

Source: Company Information.

Crude Oil Production Cost Natural Gas Production CostUSD / MMBTUUSD/Barrel

1.14 1.23

1.27 1.381.38

6.80 7.24 7.627.62 8.238.23

1.221.22

2727

2.82

3.80 3.804.024.22

5.45 5.51 5.19


Finding Costs F&D Costs

5.1 5.2 5.32 5.85 5.67

1.35 1.61 1.97 2.112.19

0.250.270.330.430.35


Raising Cost Depreciation Depletion

0.89 0.94 0.96 1.02 0.89

0.170.19

0.22 0.270.25

0.080.08

0.09 0.08 0.08


Raising Cost Depreciation Depletion

8.118.11

2.4.11

2.99

Natural Gas Pricing

Natural Gas Price at USD 4.2/mmbtu for 10000 Cal (inclusive of royalty) was last approved in May,2010.

OIL’s cost of natural Gas production is around USD 3.06/mmbtu.

Cost of exploration and Development in NELP block is much higher.

To make Natural Gas production attractive, there is need for price revision.

Govt. formed Rangarajan committee for reviewing pricing of Natural Gas.

The committee had recommended Natural Gas price as average of :

Net back Price of Indian LNG import at well head of exporting countries

Average price prevailing at major natural gas market.

For every USD one increases in Natural Gas Price:

OIL’s PAT will improve by ~Rs 220 crore.

OIL’s contribution to exchequer will be increased by ~Rs 254 crore – ~Rs 78 crore to State Govt and ~Rs 176 crore to Central Govt

2009–10 2010–11 2011-12 2012-13

ONGC 11,554 24893 44,465 49,421

OIL 1,549 3293 7,352 7892

GAIL 1,326 2111 3,183 2687

Total 14,430 30297 55,000 60,000

2009–10 2010–11 2011-12 2012-13

ONGC 80% 82% 81% 81%

OIL 11% 11% 13% 14%

GAIL 9% 7% 6% 5%

Total 100% 100% 100% 100%

Sharing of Subsidy by Upstream Companies

Rs. in crore % Sharing% SharingRs. In cr.

Realised Price (USD/Barrel)


Gross Realized Price Realized Price after Subsidy/Discount Net Realized Price

2828

68.5

86.1

114.7 109.6119.7

111.4

56.2 58.5 59.853.6

38.9

55.4

39.8 41.4 42.533.1

24.934.7

FY 10 FY 11 FY 12 FY13 Q4 FY12 Q4 FY13

Financial Performance

2929

72,414 79,056 83,20698,632 99,476

FY09 FY10 FY11 FY12 FY 13

35,68043,800 48,050

61,110 61,234


Growing Revenue and Profit

Source: Company financials

30% 31% 31% 33%

50%


CAGR 12.5%

CAGR 8.3% CAGR 14.5%

EBITDA

Dividend Payout Ratio

Revenue

Net Profit

(Rs.mn)(Rs.mn)

(As a % of Profit)(Rs.mn)

3030

21,61726,105 28,879

34,469 35,893


Leverage Remains Low

Source: Company financials

Book Value Per Share

Total Equity

Earnings Per Share

Total Debt

(in Rs.)(in Rs.)

(Rs.mn)(Rs.mn)

3131

101 114 120143

60


436572

649738

320


FY13 EPS is based on post bonus issue

share capital

93,310

137,637

156,019177,213

FY09 FY10 FY11 FY13

192,115

FY12

565375

10,143

101

FY09 FY10 FY11 FY13FY12

10,578

FY13 Book Value is based on post bonus issue share capital

Guidance: FY’14

2013-14 (Target)

Crude oil production 3.95 MMT

Natural gas production 2,740 mmscm

Increase in Exploratory and Development Drilling Meterage

Increase in Work Overs

Enhanced Water Injection

Endeavour to Enhance LPG production through NGL Recycling

Endeavour to Reduce Gas Flaring by Inducting LNG Technology

32

Awards and Accolades

OIL was awarded the prestigious BUSINESS LEADERSHIP AWARD in OIL & GAS

SECTOR by NDTV Profit on 7th January 2012.

E&P Company of the Year Award at the Petrofed Oil & Gas Industry awards for the year

2010-11

First Prize for Oil Industry Safety Award in Oil & Gas Assets (Onshore) Category

Motivational Leadership Award for 2010–11 at the World HRD Congress

Best Environment Management and Sustainable Development Award by Indian

Chamber of Commerce

Gold Award in Petroleum Sector for Outstanding Achievement in Safety Management by

the Greentech Foundation

Greentech HR Gold Award 2012 for training excellence

Performance Excellence Award 2011 by Indian Institute of Industrial Engineering

Golden Peacock Award for CSR for 2012

3333

Conclusion

3434

Thank You

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