6.1    The Company has elected to continue with the carrying value of its other Property Plant & Equipment (PPE) recognised as of April 1,2015 (transition date) measured as per the Previous GAAP and used that carrying value as its deemed cost as on the transition date as per Para D7AA of Ind AS 101 except for decommissioning provision included in the cost of other Property, Plant and Equipment (PPE) which has been adjusted in terms of para D21 of Ind AS 101 ‘First -time Adoption of Indian Accounting Standards’.

6.2    During the year 2016-17, Tapti A facilities which were part of the assets of PMT Joint Operation (JO) and surrendered by the JO to the Government of India (GoI) as per the terms of JO agreement were transferred by GoI to the Company free of cost as its nominee. During the year 2019-20, the Company opted to recognize the non-monetary government grant at nominal value and recorded the said facilities at nominal value, in line with amendment in Ind AS 20 ‘Accounting for Government Grants and Disclosure of Government Assistance’ vide Companies (Indian

Accounting Standards) Second Amendment Rules, 2018 (the ‘Rules’). These assets were decapitalised / retired to the extent of the Company’s share in the Joint Operation.

Ministry of Petroleum and Natural Gas, Government of India vide letter dated May 31,2019 has assigned the Panna-Mukta fields w.e.f. December 22, 2019 on nomination basis to the Company on expiry of present PSC without any cost to ensure continuity of operation. Being a non-monetary grant, the Company has recorded these assets and grant at a nominal value (refer Note No. 5.2).

6.3 Cyclone Tauktae hit Arabian Sea off the coast of Mumbai in the early hours of May 17, 2021 where the company’s major production installations and drilling rigs are situated/operating. The cyclone has caused damages to offshore facilities/platforms. The occurrence of incident was intimated to the Insurance Company, under offshore insurance package policy and surveyors / Loss adjustors were appointed by them for the incident. During the year the physical

survey of facilities/platforms have been undertaken by the surveyors / Loss adjustors and the Company has submitted the estimated claim amount of '8,255.00 Million (USD 103 Million) for the expenditure incurred / likely to be incurred on restoration of damages caused by the cyclone. Since various activities under the claim viz. the actual completion of all repairs, incurrence of expenditure, completion of review of documentation by the surveyors and submission

of full findings to the insurers, is likely to take some more time, the company has requested for release of ‘On Account’ payment against the claim, During the year Company has received ‘On Account’ payment of '1,314.54 Million (USD 16 Million; Gross uSd 36 Million less policy deductible of USD 20 Million) and same has been accounted for as miscellaneous receipts (refer Note no 31 and Note no 5.4).

8.1    The Company has elected to continue with the carrying value of its Capital Works-in-Progress recognised as of April 1, 2015 (transition date) measured as per the Previous GAAP and used that carrying value as its deemed cost as on the transition date as per Para D7AA of Ind AS 101 except for decommissioning and restoration provision included in the cost of Capital Works-in-Progress which have been adjusted in terms of para D21 of Ind AS 101 ‘First -time Adoption of Indian Accounting Standards’.

8.2    Certain discovered small fields (DSF) of the Company falling under various Contract Areas were identified by Directorate General of Hydrocarbon, Ministry of Petroleum & Natural Gas, and Government

10.1.1 The identification of suspended projects and the projects with cost overrun/time overrun with the estimated period of completion is done on the basis of estimates made by technical executives of the Company involved in the implementation of the projects.

10.2 During the year 2004-05, the Company had acquired, 90% Participating Interest in Exploration Block KG-DWN-98/2 from Cairn Energy India Limited for a lump sum consideration of '3,711.22 Million which, together with subsequent exploratory drilling costs of wells had been capitalized under exploratory wells in progress. During 2012-13, the Company had acquired the remaining 10% participating interest in the block from Cairn Energy India Limited on actual past cost basis for a consideration of '2,124.44 Million. Initial in-place reserves were established in this block and adhering to original PSC time lines, a declaration of commerciality (DOC) with a conceptual cluster development plan was submitted on December 21,

2009    for Southern Discovery Area and on July 15,

2010    for Northern Discovery Area. Thereafter, in the revised DOC submitted in December, 2013, Cluster-wise development of the Block had been envisaged by division of entire development area into three clusters.

The DOC in respect of Cluster II had been reviewed by the Management Committee (MC) of the block on

September 25, 2014. Field Development Plan (FDP) for Cluster-II was submitted on September 8, 2015 which included cost of all exploratory wells drilled in the Contract Area and the same had been approved by the Company Board on March 28, 2016 and by MC on March 31, 2016. Investment decision has been approved by the Company. Contracts for Subsea umbilical risers, flow lines, Subsea production system, Central processing platform - living quarter utility platform and Onshore Terminal have been awarded during 2018-19. Sixteen (16) Oil wells, Seven (7) Gas wells and Six (6) Water injector wells were drilled upto March 31, 2021. Towards early monetization, it was planned to produce Gas from U-field utilizing Vashishta and S1 Project facilities. One Gas well-U3B was completed in the month of March 2020 and test production commenced on March 5, 2020. In line with the Accounting Policy of the Company, Oil and Gas assets were created for the well U3B on establishment of proved developed reserves during the year 2019-20. Commercial production from the well commenced on May 25, 2020. Well U1B and Well U1_A_Shft were completed and put to production on August 26, 2021 and April 28, 2022 respectively. The cost of development wells in progress, Capital work in progress and Oil & gas assets as at March 31, 2023 is '56,147.21 Million (Previous year '37,488.80 Million), '142,392.36 Million (Previous year '110,903.50 Million) and '27,392.38 Million

(Previous year '24,995.63 Million) respectively under Cluster II. Considering the changes with respect to approved FDP the Company submitted the RFDP for Cluster-II development to DGH (Directorate General of hydrocarbons) on August 19, 2022 which is under review at DGH.

Further, MC has approved the 4C-3D OBN seismic data acquisition, processing & interpretation in Cluster-II (for 500SKM) under ‘Exploration in Mining Lease area after expiry of Exploration period’. The tendering process for the 500 SKM 4C-3D OBN acquisition is underway.

FDP in respect of Cluster-I was approved for development of Gas discoveries in E1 and integrated development of Oil discoveries in F1 field along with nominated field GS-29 by the Management Committee in FY 2019-20. E1 is now proposed to be developed along with integrated development of Oil discoveries in F1 field along with nominated field GS-29. Drilling of an Appraisal cum Development Well GS29_8_A was completed on April 30, 2021 under F1. The cost of development wells in progress as at March 31, 2023 is '885.56 Million (Previous year '885.56 Million).

In respect of Cluster III, the Company has submitted the FDP for UD-1 discovery of Cluster-III on August 8, 2022. The FDP after examination, has been returned by DGH for re-submitting a robust FDP The Company

proposes to formulate a robust FDP by incorporating the results of the proposed 4C-3D OBN seismic study. Further, the Company has requested Ministry of Petroleum & Natural Gas to extend the PEL timelines by 41 months i.e. upto January 1,2026 in order to carry out 4C-3D OBN seismic data acquisition, processing & interpretation in the UD-1 discovery area.

In view of the definite plan for development of all the clusters, the cost of exploratory wells in the block i.e. '32,678.81 Million (Previous year '46,483.78 Million) has been carried over.

10.3 Certain discovered small fields (DSF) of the Company falling under various Contract Areas were identified by Directorate General of Hydrocarbon, Ministry of Petroleum & Natural Gas, and Government of India for bidding under Discovered Small Field Round III - 2021, in terms of the said bid documents the value of such fields were considered as Nil. The identified contract areas have been awarded to the winning bidders (awardees) in the month of August 2022 and the PML/PELs of these contract areas have been transferred to the said awardees. Accordingly, during the year, the Company has charged off exploratory wells in progress amounting to '21,404.94 Million lying in the fields falling under contract areas offered under DSF - III and reversed the accumulated impairment of '21,285.95 Million on the said exploratory wells (refer Note no. 8.2).

11.1.1    The Company has elected to continue with the carrying value of its investments in subsidiaries, joint ventures and associates, measured as per the Previous GAAP and used that carrying value on the transition date April 1, 2015 in terms of Para D15 (b) (ii) of Ind AS 101 ‘First -time Adoption of Indian Accounting Standards’.

11.1.2    Petronet MHB Limited is classified as a subsidiary of the Company as it holds 49.99% (Previous year 49.99%) ownership interest and its subsidiary Hindustan Petroleum Corporation Limited holds 49.99% (Previous year 49.99%) ownership interest.

11.1.3    The Company is restrained from diluting the investment in the respective companies as per the covenants in the respective loan agreements of the companies till the sponsored loans are fully repaid.

11.1.4    During the year 2018-19, the Company has exercised option to exit Pawan Hans Limited by offloading entire 49% stake holdings of the Company as a preferred option, along with the strategic sale proposal being pursued by the Government of India. As at March 31, 2023, the proposed strategic sale transaction is yet to be consummated. In view of the uncertainty in the completion of the transaction,

11.6.3    The amount of '36.05 Million (Previous year '36.05 Million) is towards the fair value of guarantee fee on financial guarantee given without any consideration for the Company’s stepdown subsidiary ONGC Videsh Rovuma Limited.

11.6.4    The Company has subscribed 3,451,240,000 nos. Share Warrants of ONGC Petro additions Limited @ '9.75 per share warrant, entitling the Company to exchange each warrant with a Equity Share of Face Value of '10 after a balance payment of '0.25 for each share warrant. The position of share warrants subscribed by the Company in share warrants issued by OPaL is as under:

11.6.5 The Company entered into an arrangement for backstopping support towards repayment of principal and coupon of Compulsory Convertible Debentures (CCDs) amounting to '77,780.00 Million (Previous year '77,780.00 Million) issued by the Joint Venture ONGC Petro additions Limited (OPaL) in three tranches. The Company is continuing the same back stopping support. The outstanding interest accrued as at March 31, 2023 is '1,766.85 Million (Previous year '1,699.28 Million). The first and third tranche of CCDs amounting to '56,150 Million and '4,920 Million has been further extended for a period of 18 months and are due for maturity in December 2023 and February 2024 respectively. The second tranche of CCD amounting to '16,710 Million will be due for maturity in May, 2023. The same has been further extended by 18 months and put option exercise date will be October 18, 2024 and conversion date will be November 18, 2024.

Based on opinion of Expert Advisory Committee (EAC) of the Institute of Chartered Accountants of India, the Company has recognized a financial liability at fair value for backstopping support towards repayment of principal and a financial guarantee obligation towards coupon amount with a corresponding recognition of Deemed Investment in OPaL.

The Deemed Investment amount of '62,393.68

Million (As at March 31, 2022 '62,381.35 Million) includes, '62,308.05 Million (As at March 31, 2022 '62,308.05 Million) towards the fair value of Financial Liability against these CCDs and '85.63 Million (As at March 31,2022 '73.30 Million) towards the fair value of guarantee fee on financial guarantee given without any consideration for OPaL.

11.6.6    Company’s Joint Venture Indradhanush Gas Grid Limited (IGGL) had taken a loan sanction of '25,940 Million from Oil Industry Development Board (OIDB) on August, 25 2021 for the purpose of implementation of North East Gas Grid Project guaranteed by the promoters of IGGL in proportion of these shareholdings. During the year loan of '1,000 Million has been taken by IGGL out of the sanctioned amount '25,940 Million. The Company has recognized a financial guarantee obligation in respect of its shareholding in IGGL with a corresponding recognition of Deemed Investment in IGGL of '7.68 Million (As at March 31, 2022 'nil) for the above financial guarantee.

11.6.7    During the year, the Company has subscribed an additional 15,000,000 no’s (previous year 44,420,792 no’s) units of ONGC Startup Fund Trust (registered with SEBI as an Alternative Investment Fund category I) for the total consideration of '150 Million (previous year '444.21 Million).

12.2    Generally, the Company enters into crude oil and gas sales arrangement with its customers. The normal credit period on sales of crude, gas and value added products is 7 - 30 days. No interest is charged during this credit period. Thereafter, interest on delayed payments is charged at SBI Base rate / SBI MCLR plus 4% - 6% per annum compounded each quarter on the outstanding balance.

Out of the gross trade receivables as at March 31, 2023, an amount of '91,745.82 Million (as at March 31,2022 '101,672.40 Million) is due from Public sector Oil and Gas Marketing companies, the Company’s largest customers. There are no other customers who represent more than 5% of total balance of trade receivables.

Accordingly, the Company assesses impairment loss on dues from Public sector Oil Marketing Companies on facts and circumstances relevant to each transaction.

The Company has concentration of credit risk due to the fact that the Company has significant receivables from Public sector Oil and Gas Marketing Companies (refer Note No. 44.2.2, 44.3.2 & 45.4). However, these companies are reputed and creditworthy public sector undertakings (PSUs).

12.3    Includes an amount of '3,764.43 Million (Previous year '3,764.43 Million) due towards Pipeline Transportation Charges for the period from November 20, 2008 to July 6, 2021 from GAIL India Limited (GAIL) on account of revised pipeline transportation tariff charges.

In terms of Gas Sales Agreement (GSA) signed between GAIL and the Company, GAIL is to pay transportation charges in addition to the price of gas in case of Uran Trombay Natural Gas Pipe Line (UTNGPL) and were being paid by GAIL. Subsequent to the replacement of pipeline in 2008, the revised pipeline transportation tariff in respect of UTNGPL was approved by Petroleum and Natural Gas Regulatory Board (PNGRB) for which debit notes /invoices was raised to GAIL with effect from November 20, 2008.

Mahanagar Gas Limited (MGL), one of the customers of GAIL, had filed a complaint with PNGRB on February 12, 2015 regarding applicability of tariff on supply of gas to GAIL. After hearing all parties, PNGRB vide order dated October 15, 2015 dismissed the complaint and gave a verdict in favour of the Company. Pursuant to appeal by MGL to the Appellate Tribunal for Electricity (APTEL), the case was remanded back to PNGRB. Once again, PNGRB

vide order dated March 18, 2020 had dismissed the complaint, authorized the pipeline as a Common Carrier Pipeline and directed both GAIL and MGL to pay the transportation tariff fixed by PNGRB from time to time for UTNGPL. MGL again filed an appeal with APTEL on April 04, 2020 against the order of PNGRB. APTEL vide order dated July 16, 2021 remanded the matter to PNGRB for fresh adjudication and passing final order within 3 months from the date of appointment of Member (Legal). PNGRB vide order dated September 30, 2022, directed MGL to pay the transportation charges as per the transportation tariff fixed by PNGRB for UTNGPL vide Tariff Order dated 30 December 2013 for the period from January 1,2014 onwards within a period of 2 months of passing the order. However PNGRB rejected the transportation charges from November 20, 2008 to December 31, 2013. MGL filed a writ petition before the Hon’ble High Court of Delhi challenging the PNGRB’s order dated September 30, 2022. The Hon’ble High Court of Delhi, vide order dated December 13, 2022 stayed the recovery against the PNGRB order and directed MGL to deposit a sum of '500 Million with GAIL. Although the Company has filed appeal against the order of PNGRB before APTEL, the same has been granted stay by APTEL due to the order of Hon’ble Supreme Court wherein stay has been granted for all cases / proceedings relating to GAIL (India) Limited before APTEL. The Company is in process of filing an appeal before Hon’ble High Court of Delhi in this matter. Pending final decision in the matter the Company has made a provision of '745.50 Million during the year towards the transportation charges receivable for the period from November 20, 2008 to December 31,2013

Rashtriya Chemicals and Fertilisers Ltd (RCF), another customer of GAIL, was paying revised tariff since February 2016 and the tariff from November 20, 2008 till January 31, 2016 was under dispute. The matter was referred to Committee of Secretaries under Administrative Mechanism for Resolution of CPSEs Disputes (AMRCD) that met on June 17, 2021 and concluded that RCF would pay the transportation charges with effect from the date of order (i.e. December 30, 2013) of revised tariff rates of PNGRB. Accordingly during the year 2021-22 an amount of '196.52 Million was received pertaining to the period 30 December 2013 to January 31, 2016. The Company has requested clarification from the MoP&NG regarding the impact of AMRCD order on its receivable from GAIL. However, in view of the conclusion of AMRCD, a provision of '446.43 Million has been created against dues from GAIL on account

of Pipeline Transportation Charges in respect of RCF for the period prior to December 30, 2013.

The Company has been raising invoices on GAIL towards Pipeline Transportation Charges during the period from November 2008 to March 2023 amounting to '8,717.60 Million (Previous year '7,371.26 Million), out of this an amount of '4,954.55 Million (Previous year '3,606.83 Million) has since been received.

In view of the above, the balance receivable (excluding provision) of '2,572.51 Million as at March 31, 2023 (Previous year '3,318.00 Million) is considered good.

12.4 Includes an amount of '1,790.04 Million receivable from Public sector Oil Marketing Companies (OMC’s) towards sale of crude oil from western offshore region during the month of March’23. Sale of crude oil from Western offshore to Public sector Oil Marketing Companies (OMC’s) has been effected on provisional basis pending finalisation of Crude Oil Sales Agreements (CoSA) with the OMCs. The Company has raised invoices for sale of crude oil at benchmark prices as applicable for the period from October 2022 to February 2023. Pending finalisation of COSA’s, OMCs have released payments for

14.1 The above amount has been deposited with State Bank of India under section 33ABA of the Income Tax Act, 1961 and can be withdrawn only for the purposes specified in the Scheme i.e. towards removal of equipment and installations in a manner agreed with Central Government pursuant to an abandonment plan. This amount is considered as

restricted cash and hence not considered as ‘Cash and cash equivalents’.

14.2 Includes '2,834.05 Million (Previous year '2,650.56 Million) towards Tapti A Facilities and '51,097.38 Million (Previous year '47,765.55 Million) towards Panna Mukta Fields (refer Note No. 5.2, 6.2 and 24.3).

15.1    During the year 2010-11, the Oil Marketing Companies, nominees of the Government of India (GoI) recovered USD 80.18 Million (Share of the Company USD 32.07 Million (equivalent to '2,634.55 Million) as per directives of GoI in respect of Joint Operation - Panna Mukta and Tapti Production Sharing Contracts (PSCs). Pending finality by Arbitration Tribunal, the Company’s share of USD 32.07 Million equivalent to '2,634.55 Million (March 31, 2022: '2,429.30 Million) has been disclosed under the head ‘Advance Recoverable in Cash’ (refer Note No. 48.1.1 (d)).

15.2    In Ravva Joint Operation, the demand towards additional profit petroleum raised by Government of India (GoI), due to differences in interpretation of the provisions of the Production Sharing Contract (PSC) in respect of computation of Post Tax Rate of Return (PTRR), based on the decision of the Malaysian High Court setting aside an earlier arbitral tribunal award in favor of operator, was disputed by the operator Vedanta Limited (erstwhile Cairn India Limited). The Company is not a party to the dispute but has agreed to abide by the decision applicable to the operator. The Company is carrying an amount of USD 167.84 Million (equivalent to '13,788.44 Million) after adjustments for interest and exchange rate fluctuations which has been recovered by GoI,

this includes interest amounting to USD 54.88 Million (equivalent to '4,437.83 Million). The Company has made impairment provision towards this recovery made by the GoI.

In subsequent legal proceedings, the Appellate Authority of the Honorable Malaysian High Court of Kuala Lumpur had set aside the decision of the Malaysian High Court and the earlier decision of arbitral tribunal in favour of operator was restored, against which the GoI has preferred an appeal before the Federal Court of Malaysia. The Federal Court of Malaysia, vide its order dated October 11,2011, has dismissed the said appeal of the GoI.

The Company has taken up the matter regarding refund of the recoveries made in view of the favorable judgment of the Federal Court of Malaysia with Ministry of Petroleum and Natural Gas (MoP&NG), GoI. However, according to a communication dated January 13, 2012, MoP&NG expressed the view that the Company’s proposal would be examined when the issue of carry in Ravva PSC is decided in its entirety by the Government along with other partners.

In view of the perceived uncertainties in obtaining the refund at this stage, the impairment made in the books as above has been retained against the amount recoverable. (Figures in ' are restated).

17.1    The value of 3,30,484 nos. Carbon Credits (CER) (Previous year 3,30,484 nos.) has been treated as nil (as at March 31, 2022 '5.59 Million) as the same do not have any quoted price and seems to be insignificant with respect to net realisable value. There are no CERs under certification. During the year '297.37 Million ('386.62 Million for 2021-22) and '275.58 Million C335.45 Million for 2021-22) have been expensed towards Operating & maintenance cost and depreciation respectively for emission reduction equipment.

17.2    Inventory amounting to '238.97 Million (as at March 31, 2022 '217.04 Million) has been valued at net realisable value of '150.54 Million (as at March 31, 2022 '168.45 Million). Consequently, an amount of '88.43 Million (as at March 31,2022 '48.59 Million) has been recognised as an expense in the Statement of Profit and Loss under note 33.

19.2 Matter of Dispute on Delivery Point of Panna-Mukta gas between Government of India (GoI) and BG Exploration and Production India Limited (BGEPIL) along with Reliance Industries Limited (RIL) and the Company (PMT JO Partners) arose due to differing interpretation of relevant PSC clauses. According to the PMT JO Partners, Delivery Point for Panna-Mukta gas is at Offshore, however, Ministry of Petroleum and Natural Gas (MoP&NG), GoI and GAIL (India) Limited (GAIL) maintained that the delivery point is onshore at Hazira. The gas produced from Panna-Mukta fields was transported through Company’s pipelines. Owing to the delivery point dispute neither the seller (PMT JO) nor the buyer of gas (GAIL) was paying any compensation to the Company for usage of its pipeline for gas transportation.

Hon’ble Gujarat High Court decided that the Panna Mukta oil fields from where the movement of goods is occasioned fall within the customs frontiers of India. Consequently, the sale of goods cannot be said to have taken place in the course of import of goods into the territory of India. Accordingly the Hon’ble Gujarat High Court has determined that the Delivery Point for Panna-Mukta gas is at Offshore. The State Government of Gujarat has filed a petition with the Hon’ble Supreme Court of India against the decision of Hon’ble Gujarat High Court. Since the said matter of determination of delivery point is pending with the Hon’ble Supreme Court of India, an amount of USD 49.72 Million (Previous year USD 51.90 Million) equivalent to '4,046.39 Million (Previous year '3,871.25 Million) for the PMT JV including Company’s Share USD 19.67 Million (Previous year

USD 21.18 Million) equivalent to '1,600.79 Million (Previous year '1,556.87 Million) is maintained in the Escrow account by the PMT JV Partners.

The Company has entered into settlement agreement with the PMT JO Partners on the issue in the month of April 2023, accordingly '432.97 Million over and above the net receivables have been accounted as miscellaneous receipts in financial year 2022-23. The proceeds towards the settlement from the escrow account has been received by the Company in the month of May 2023.

20.2    Terms / rights attached to equity shares

The Company has only one class of equity shares having a par value of '5 per share. Each holder of equity shares is entitled to one vote per share. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting.

In the event of liquidation of the Company, the holders of equity shares will be entitled to receive remaining assets of the Company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders.

20.3    The Board of Directors of the Company, at the 312th meeting held on December 20, 2018 approved the proposal for buy-back of equity shares of the Company upto 252,955,974 fully paid-up equity shares at the price of '159/- per equity share payable in cash for an aggregate consideration not exceeding '40,220 Million. The buy-back offer worked out to 2.50% of the net-worth of the Company as on March 31, 2017 and 2.34% as on March 31, 2018. The Company has completed the buy-back of 252,955,974 fully paid-up equity shares on February 22, 2019.

Upon completion of the buy-back in 2018-19, the number of paid-up equity share capital of the Company stands reduced from 12,833,235,180 C64,166.17 Million) to 12,580,279,206 ^62,901.39 Million).

20.5.2 During the financial year 2022-23, subsequent to the completion of transaction under OFS, the Government of India made an offer to eligible employees and sold 20,37,177 equity shares of the Company representing 0.02% of the total equity share capital of the Company.

On November 14, 2022 and February 14, 2023, the Company had declared an interim dividend of '6.75 per share (135%) and '4.00 per share (80%) respectively which has since been paid.

In respect of the year ended March 31, 2023, the Board of Directors has proposed a final dividend of '0.50 per share (10 %) be paid on fully paid-up equity shares. This final dividend shall be subject to approval by shareholders at the ensuing Annual General Meeting and has not been included as a liability in these financial statements. The proposed equity dividend is payable to all holders of fully paid equity shares. The total estimated equity dividend to be paid is '6,290.14 Million.

21.5 During the 2020-21, 18,972 equity shares of '10 each (equivalent to 37,944 equity shares of '5 each) which were forfeited in the year 2006-07 were cancelled w.e.f. November 13, 2020 and accordingly the partly paid up amount of '0.15 Million against these shares were transferred to the Capital Reserve in 2020-21.

24.2    The Company estimates provision for decommissioning as per the principles of Ind AS 37 ‘Provisions, Contingent Liabilities and Contingent Assets’ for the future decommissioning of Oil and Gas assets, wells in progress etc. at the end of their economic lives. Most of these decommissioning activities would be in the future for which the exact requirements that may have to be met when the removal events occur are uncertain. Technologies and costs for decommissioning are constantly changing. The timing and amounts of future cash flows are subject to significant uncertainty. The economic life of the Oil and Gas assets is estimated on the basis of long term production profile of the relevant Oil and Gas asset. The timing and amount of future expenditures are reviewed annually, together with rate of inflation for escalation of current cost estimates and the interest rate used in discounting the cash flows.

24.3    Includes '33,810.40 Million (Previous year '35,284.92 Million) accounted as provision for contingency to the extent of excess of accumulated balance in the SRF fund after estimating the decommissioning provision of Panna-Mukta fields and Tapti Part A facilities as per the Company’s accounting policy (refer Note No. 5.2, 6.2 & 14.2).

24.4    The Company had received demand orders from Service Tax Department at various work centres on account of Service Tax on Royalty in respect of Crude oil and Natural gas. Appeals against such orders have been filed before the Tribunals. The Ahmedabad Tribunal adjourned the matter sine-die vide order dated June 25, 2019, against which the Company has filed writ petition before Hon. Gujarat High Court. In this matter, Hon. Gujarat High Court in the hearing held on January 4, 2021 directed the

revenue authorities to file counter affidavit by January 21, 2021. The Central Government has filed counter affidavit on January 30, 2021. The next date of hearing before Hon. Gujarat High court is not scheduled as yet. The Company had also obtained legal opinion as per which the Service Tax/GST on Royalty in respect of Crude oil and Natural gas is not applicable. Meanwhile, the Company also received demand order dated January 1,2019 on account of GST on Royalty in the State of Rajasthan against which the Company filed writ petition (4919/2019) before Hon. High Court of Rajasthan. The Hon. High Court of Rajasthan heard the matter on April 3, 2019 and issued notice to Department with a direction that no coercive action shall be taken against the Company. The final hearing has not yet taken place. The Company also filed writ of mandamus (9961/2019) before Hon. High Court of Madras seeking stay on the levy of GST on royalty. The Hon. High Court of Madras heard the matter on April 3, 2019 and issued notice to Central Government and State Government. The Central Government filed their counter affidavit on August 26, 2019. The Company filed additional grounds to the writ petition and filed rejoinder to the counter of the Central Government on January 24, 2020. The Hon. High Court of Madras closed the writ petition in hearing held on July 6, 2022 based on the department’s rejection of Company’s GST refund applications without further examination on merit. However liberty was granted to challenge the refund rejection order of department in accordance with law, accordingly, an appeal has been filed before the appellate authority challenging the department’s refund rejection order dated June 24, 2022. Disputes are also pending at various forums for various work centres in respect to GST on Royalty.

As an abundant caution, the Company has deposited the disputed Service Tax and GST on royalty along-with interest under-protest amounting to '115,581.52 Million up to March 31,2023 (?87,567.87 Million up to March 31,2022).

The Company shall continue to contest such disputed matters before various forums based on the legal opinion as per which the Service Tax/GST on Royalty in respect of Crude oil and Natural gas is not applicable. However, considering the pending final decision in a similar matter by the Nine Judges’ Bench of Hon’ble Supreme Court, which is yet to be constituted and keeping in view the considerable time elapsed, during the year, the company has reviewed the entire issue of disputed Service tax and GST on royalty and has decided to make a provision towards these disputed taxes as a prudent and conservative practice in respect of the nominated fields, as per agreed terms in JV blocks where there are no disputes amongst the JV partners and to the extent of company’s participating interest in the JV blocks where there are disputes amongst the JV partners. Accordingly, during the year the Company has provided '92,351.14 Million towards disputed taxes for the period from April 1, 2016 to March 31, 2022 together with interest thereon up to March 31, 2023 towards the ST/GST on Royalty and being material has been disclosed as an exceptional item. Further, a similar provision of '28,723.32 Million has also been made during the year for disputed taxes for the financial year 2022-23.

The Company has also obtained a legal opinion from the Additional Solicitor General, Supreme Court of India and other legal expert, with respect to JV blocks where there are disputes with JV partners, as per which the Service Tax/GST, if applicable on royalty, will required to be discharged by the JV partners in their respective share of participating interest in the

JV blocks, and pending resolution of the disputes, other partners’ share of disputed ST/GST on Royalty in such JV blocks together with interest up to March 31, 2023 amounting to '43,318.13 Million has not been considered for provision and the same has been disclosed as contingent liability.

The remaining disputed demand received by the Company towards penalty and other differences i.e. '18,624.60 Million has also been disclosed as contingent liability.

Considering the Income tax experts’ opinion on the subject, the aforesaid amount deposited under protest has been claimed in the Income Tax return / in the ongoing assessment & appellate proceedings, as an allowable expenditure under section 37 read with section 43B of the Income Tax Act, 1961 for the relevant earlier assessment years and has also been considered as an allowable expenditure while calculating the current tax for the earlier years and also towards the current tax for the year ended March 31,2023. The Company has also created deferred tax asset amounting to '879.86 Million in respect of the amounts yet to be deposited against the provision made for disputed taxes for the above periods. (refer Note no. 48.1.1.b)

24.5 A suspected fraud was noticed by the Company, wherein some of its regular / contractual employees in collusion with some vendors have made certain fictitious medical payments involving misappropriation of funds, the matter is being investigated by internal and external agencies and the final amount of the alleged fraud shall be known after the outcome of the investigation. Pending investigations an interim amount of '2.41 Million has been affirmed as a fraud on the Company and accordingly provision for the said amount has been made towards doubtful claims receivable from vendors.

26.1 During the year 2016-17, assets, facilities and inventory which were a part of the Tapti A series of PMT Joint Operation (JO) and surrendered by the JO to the Government of India as per the terms and conditions of the JO Agreement and these assets, facilities and inventory were transferred by Government of India to the Company free of cost as its nominee. In line with

amendment in Ind AS 20 ‘Accounting for Government Grants and Disclosure of Government Assistance’ vide Companies (Indian Accounting Standards) Second Amendment Rules, 2018 (the ‘Rules’), during the year 2019-20 the Company had opted to recognize the non-monetary government grant at nominal value. (refer Note No. 5.2 & 6.2).

Registration of charges or satisfaction with Registrar of Companies

During the year, the Company had availed the above working capital loans on a rolling basis against lien on Term Deposits from the nationalized banks. The banks have confirmed that no charge is required

are in process and it is expected to be finalized soon. (Refer note no. 12.4)

For Crude Oil produced in North East Region, Sales revenue in respect of Crude oil supplied to IOCL is based on the pricing formula provided in COSA signed with IOCL effective from April 01,2018, is valid for 5 years till March 31,2023 (approved for extension by 1 more year till March 31,2024) and to Numaligarh Refinery Limited (NRL) is based on pricing formula provided by Ministry of Petroleum and Natural Gas (MoP&NG).

The process of finalizing and signing of COSAs for crude oil sale from other regions is under process as at March 31,2023. Crude oil of these regions is being supplied to Public sector Oil Marketing Companies on the basis of provisional prices.

30.2 Majority of Sales revenue in respect of Natural Gas is based on domestic gas price of USD 6.10/ mmbtu and USD 8.57/mmbtu (on GCV basis) notified by GoI for the period April 01, 2022 to September 30, 2022 and October 01, 2022 to March 31, 2023 respectively in terms of “New Domestic Natural Gas Pricing Guidelines, 2014”. For consumers in NorthEast (upto Govt. allocation), consumer price is 60% of the domestic gas price and the difference between domestic gas price and consumer price is paid to the Company through GoI Budget and classified as ‘North-East Gas Subsidy’.

30.3 LPG produced by the Company is presently being sold as per guideline issued by MoP&NG to PSU Oil Marketing Companies (OMCs), as per provision of Memorandum of Understanding (MOU) dated March 31, 2002 signed by the Company with OMCs which was valid for a period of 2 years or till

the same is replaced by a bilateral agreement or on its termination.

Value Added Products other than LPG are sold to different customers at prices agreed in respective Term sheets / Agreements entered into between the parties.

38.1 Pursuant to the introduction of Section 115BAA of the Income Tax Act, 1961 vide Taxation Laws (Amendment) Act, 2019 the Company had an option to pay corporate income tax at the rate of 22% plus applicable surcharge and cess (lower rate) as against the earlier rate of 30% plus applicable surcharge and cess, subject to certain conditions. Considering all the provisions under said section 115BAA of the Income Tax Act, 1961, during the year ended March 31,2022 the Company had decided to avail the option of lower rate with effect from the financial year 2020-21. Accordingly, the Company had recognized provision for tax expenses during the previous year and re-measured its net Deferred Tax liabilities on the basis of the provision prescribed in the said section.

The net impact in the previous year due to availing the above option had resulted in decrease in deferred tax by '90,905.15 Million (of which '(-)1,382.25 Million was accounted in Other Comprehensive Income) and decrease in current tax by '28,019.77 Million (including '1,639.72 Million relating to earlier years).

During the year, the Company has considered the benefit of deduction on dividend income during the year, as per section 80M of the Income Tax Act, 1961, having a tax impact amounting to '6,293.64 Million (previous year '4,245.04 Million) on current tax expense.

All the employee benefit plans of the Company are run as Group administration plans (Single Employer Scheme) including employees of the Company seconded to ONGC Videsh Limited (OVL) 100% subsidiary, as well as employees directly appointed by OVL.

Further, the Company accounts for the employee benefit liability of all Defined Benefit plans pertaining to OVL employees in its books of account and expenditure for the period is transferred to OVL’s books of account. This is done in compliance with the requirement for group administrative plan stated in para 38 of Ind AS 19 ‘Employee Benefits’.

42.1    Defined Contribution plans:42.1.1    Post Retirement Benefit Scheme (PRBS)

The defined contribution pension scheme of the Company for its employees is administered through a separate trust. The obligation of the Company is to contribute to the trust to the extent of amount not exceeding 30% of basic pay and dearness allowance as reduced by the employer’s contribution towards provident fund, gratuity, post-retirement medical Benefit (PRMB) or any other retirement benefits.

The Board of Trustees of the Trust functions in accordance with any applicable guidelines or directions that may be issued in this behalf from time to time by the Central Government. The Board of trustees have the following responsibilities:

(i)    Investments of the surplus as per the pattern notified by the Government in this regard so as to meet the requirements of the fund from time to time.

(ii)    Fixation of rate of contribution and interest thereon.

(iii)    Purchase of annuities for the members.

42.1.2    National Pension Scheme (NPS)

The Company had introduced NPS for its employees during the financial year 2020-21 within the overall limit of Post Retirement Benefit Scheme. An employee has the option to determine the contribution to be made in PRBS and NPS.

The obligation of the Company is to contribute to NPS at the option of employee to the extent of amount not exceeding 30% of basic pay and dearness allowance as reduced by the employer’s contribution towards provident fund, gratuity, postretirement medical Benefit (PRMB), post-retirement

benefit scheme or any other retirement benefits. An employee can opt for a maximum of up to 10% of its Basic Salary and DA as employer’s contribution towards NPS. All other standard provisions of NPS applies to the scheme.

42.2    Employee Pension Scheme 1995

The Employee Pension Scheme -1995 is administered by Employees Provident Fund Organization of India, wherein the Company has to contribute 8.33% of salary (subject to maximum of '15,000 per month) out of the employer’s contribution to Provident Fund.

42.3    Composite Social Security Scheme (CSSS)

The Composite Social Security Scheme is formulated by the Company for the welfare of its regular employees and it is administered through a separate Trust, named as Composite Social Security Scheme Trust. The obligation of the Company is to provide matching contribution to the Trust to the extent of contribution of the regular employees of the Company. The Trust provides an assured lump sum support amount in the event of death or permanent total disablement of an employee while in service. In case of Separation other than Death/Permanent total disability, employees own contribution along with interest is refunded.

The Board of Trustees of the Trust functions in accordance with Trust deed, Rule, Scheme and applicable guidelines or directions that may be issued by Management from time to time.

The Board of Trustees has the following responsibilities:

(i)    Investments of the surplus as per the pattern notified by the Government in this regard so as to meet the requirements of the fund from time to time.

(ii)    Fixation of rate of interest to be credited to members’ accounts.

(iii)    To provide cash benefits to the nominees in the event of death of an employee or Permanent Total Disablement leading to the cessation from service and refund of own contribution along with interest in case of separation other than death.

During the year, the Company has made an additional contribution of '991.91 Million to CSSS Trust on account of increment in financial support over and above the existing financial support for cases of death/permanent total disability of the regular employee due to accident while on duty.

42.5.1 Brief Description: A general description of the type of Employee Benefits Plans is as follows:

All the employee benefit plans of the Company are run as Group administration plans (Single Employer Scheme) which include employees of the Company seconded to ONGC Videsh Limited (OVL) 100% subsidiary, as well as employees directly appointed by OVL.

The Company pays fixed contribution to provident fund at predetermined rates to a separate trust, which invests the funds in permitted securities. The obligation of the Company is to make such fixed contribution and to ensure a minimum rate of return to the members as specified by Government of India (GoI). As per report of the consulting actuary, overall interest earnings and cumulative surplus is more than the statutory interest payment requirement. Hence, no further provision is considered necessary. The details of fair value of plan assets and obligations are

subject to the completion of minimum 20 years of service and 50 years of age.

An employee should have put in a minimum of 15 years of service rendered in continuity in the Company at the time of superannuation to be eligible for availing post-retirement medical facilities. However, as per DPE guidelines dated August 03, 2017, the PostRetirement Medical Benefits is allowed to Board Level executives (without any linkage to 15 years of service) upon completion of their tenure or upon attaining the age of retirement, whichever is earlier.

As per the approved PRMB scheme of the Company, “ONGC PRMB Trust” was formed and subsequently registered in financial year 2021-22. During the same year, funding towards Post-Retirement Medical Liability was started in a staggered manner and the Company has contributed '27,240 Million to the ONGC PRmB

Trust. In the following year i.e. financial year 2022-23, Post-Retirement Medical Liability was fully funded and the Company has contributed '23,895.34 Million (including '86.39 Million contributed by separated employees) to the ONGC PRMB Trust. The PRMB fund is managed by Life Insurance Corporation of India. Accordingly, the PRMB liability and its plan assets are accounted for as per the requirements of Ind AS- 19 “Employee Benefits”.

42.5.5    Terminal Benefits

At the time of superannuation, employees are entitled to settle at a place of their choice and they are eligible for Settlement Allowance.

42.5.6    These defined benefit plans typically expose the Company to actuarial risks such as: investment risk, interest rate risk, longevity risk and salary risk.

No other post - retirement benefits are provided to these employees.

In respect of the above plans, the most recent actuarial valuation of the plan assets and the present value of the defined benefit obligation were carried out as at March 31, 2023 by a member firm of the Institute of Actuaries of India. The present value of the defined benefit obligation, and the related current service cost and past service cost, were measured using the projected unit credit method.

42.5.7    Other long term employee benefits42.5.8    Earned Leave (EL) Benefit

Accrual - 30 days per year

Encashment while in service - 75% of Earned Leave balance subject to a maximum of 90 days per calendar year

Encashment on retirement - Maximum 300 days

Scheme is funded through Life Insurance Corporation of India (LIC).

Each employee is entitled to get 15 earned leaves for each completed half year of service. All regular employees of the Company while in service are allowed encashment of Earned Leave once in a calendar year, to the extent of 75% of the Earned Leave at their credit, subject to maximum of 90 days.

In addition, each employee is entitled to get 10 HPL at the end of every six months. The entire accumulation is permitted for encashment only at the time of retirement. Department of Public Enterprise had clarified earlier that sick leave cannot be encashed, though Earned Leave (EL) and Half Pay Leave (HPL) could be considered for encashment on retirement subject to the overall limit of 300 days. Consequently, Ministry of Petroleum and Natural Gas (MoP&NG), GOI had advised the Company to comply with the DPE Guidelines. Subsequently, the matter has been dealt

in 3rd Pay Revision Committee recommendations, which is effective January 1,2017 and Central Public Sector Enterprises have been allowed to frame their own leave rules considering operational necessities and subject to conditions set therein. Therefore, the requisite conditions are met by the Company.

42.5.9 Good Health Reward (Half pay leave)

Accrual - 20 days per year

Encashment while in service - Nil

Encashment on retirement - 50% of Half Pay Leave balance.

Scheme is funded through Life Insurance Corporation of India (LIC).

The liability for the same is recognized annually on the basis of actuarial valuation.

The discount rate is based upon the market yield available on Government securities at the accounting date with a term that matches the weighted average duration of present benefit obligations. The salary growth takes account inflation, seniority, promotion and other relevant factors on long term basis. Expected rate of return on plan assets is based on market expectation, at the beginning of the year, for return over the entire life of the related obligation.

The mortality rate for Male insured lives before

retirement have been assumed for Actuarial Valuation as on March 31, 2023 as per 100% of Indian Assured Life Mortality (2012-14) issued by Institute of Actuaries of India on August 2, 2018. As separate rates applicable for female lives has not been notified by The Institute of Actuaries of India, uniform rates of mortality for Male have been used for both Male and Female employees for computation of Employee Benefit Liability. The mortality rate after retirement is assumed as per Indian Individual Annuitant’s Mortality Table (2012-15) effective from April 01,2021.

Expected Contribution in respect of Gratuity for next year will be '588.65 Million (for the year ended March 31,2022 '595.37 Million).

Expected Contribution in respect of Leave Liability for next year will be '2,275.09 Million (for the year ended March 31,2022 '2,346.83 Million).

Expected Contribution in respect of PRMB Liability for

next year will be '820.89 Million (for the year ended March 31,2022 '2,767.05 Million).

The Company has recognized a gratuity liability of '71.60 Million as on March 31,2023 (As at March 31, 2022 '81.13 Million) as per actuarial valuation for 131 contingent employees (As at March 31, 2022: 150 employees) engaged in different work centers.

The sensitivity analysis presented above may not be representative of the actual change in the defined benefit obligation as it is unlikely that the change in assumptions would occur in isolation of one another as some of the assumptions may be correlated. Sensitivity due to mortality & withdrawals are not material & hence impact of change not calculated.

Furthermore, in presenting the above sensitivity analysis, the present value of the defined benefit obligation has been calculated using the projected unit credit method at the end of the reporting period, which is the same as that applied in calculating the defined benefit obligation liability recognised in the balance sheet.

43. Segment Reporting

43.1 The Company has identified and reported segments taking into account the different risks and returns, the organization structure and the internal reporting systems. Accordingly, the Company has identified following geographical segments as reportable segments

43.2.1    Segment revenue reported above represents revenue generated from external customers. There were no inter-segment sale in the current year (Previous year: Nil).

43.2.2    The accounting policies of the reportable segments are the same as the Company’s accounting policies described in Note No. 3. Segment profit represents the profit before tax earned by each segment excluding finance cost and other income like interest/dividend income. This is the measure reported to the Chief Operating Decision maker for the purposes of resource allocation and assessment of segment performance.

43.3.1    All assets are allocated to reportable segments other than investments in subsidiaries, associates and joint ventures, other investments, loans and current and deferred tax assets.

43.3.2    All liabilities are allocated to reportable segment other than borrowing, current and deferred tax liabilities.

43.3.3 Segment revenue, results, assets and liabilities include the respective amounts identifiable to each of the segments and amount allocated on reasonable basis. Unallocated expenditure includes common expenditure incurred for all the segments and expenses incurred at the corporate level. Finance cost includes unwinding of discount on decommissioning provisions not allocated to segment.

43.7 Information about major customers

Company’s significant revenues (more than 85%) are derived from sales to Public Sector Undertakings. The total sales to such companies amounted to '1,385,309.74 Million in 2022-23 and '930,188.42 Million in 202122.

No other single customer contributed 10% or more to the Company’s revenue for 2022-23 and 2021-22.

44.2.4.1 During the year 2019-20, the Company had approved the related party transaction for transfer of Hazira Dahez Naptha Pipeline (HDNPL) to OPaL on as-is basis for a consideration of '1,653.40 Million comprising '1,154.40 Million (excludes GST) towards the cost incurred by Company for partially completed HDNPL pipe line with associated facilities and '499.00 Million towards Arbitration award and other related legal expenses.

The arbitration award was pronounced against the Company in the ongoing dispute with M/s Punj Llyod

Limited, and the Company has challenged arbitral award in the Hon’ble High Court of Bombay. The matter was heard by Hon’ble High Court of Bombay on September 29, 2022 wherein the Company was directed to deposit '380 Million within 6 weeks. Accordingly the Company has deposited the aforesaid amount on February 1,2023 in consultation with OPaL and obtained stay on the impugned arbitration award. Management of OPaL has agreed to reimburse the same to the Company in terms of the Asset Transfer Agreement for which the Company is in the process of raising a claim for reimbursement.

The Company’s objective when managing capital is to:

•    Safeguard its ability to continue as going concern so that the Company is able to provide maximum return to stakeholders and benefits for other stakeholders; and

•    Maintain an optimal capital structure to reduce the cost of capital.

The Company maintains its financial framework to support the pursuit of value growth for shareholders, while ensuring a secure financial base. In order to maintain or adjust the capital structure, the Company may adjust the amount of dividends to shareholders,

return capital to shareholders, issue new shares or sell assets to reduce debt.

The capital structure of the Company consists of total equity (refer Note No. 20 & 21). The Company is not subject to any externally imposed capital requirements.

The management of the Company reviews the capital structure on a regular basis. As part of this review, the committee considers the cost of capital, risks associated with each class of capital requirements and maintenance of adequate liquidity.

45.1.1 Gearing Ratio

The Company has outstanding current and noncurrent borrowings / debt. Accordingly, the gearing ratio is worked out as followed:

No funds have been advanced or loaned or invested (either from borrowed funds or share premium or any other sources or kind of funds) by the Company to or in any other person(s) or entity (ies), including foreign entities (“Intermediaries”) with the understanding, whether recorded in writing or otherwise, that the Intermediary shall lend or invest in party identified by or on behalf of the Company (Ultimate Beneficiaries). The Company has not received any fund from any party(s) (Funding Party) with the understanding that the Company shall whether, directly or indirectly lend or invest in other persons or entities identified by or on behalf of the Company (“Ultimate Beneficiaries”) or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.”

45.3 Financial risk management objectives

While ensuring liquidity is sufficient to meet Company’s operational requirements, the Company also monitors and manages key financial risks relating to the operations of the Company by analyzing exposures by degree and magnitude of risks. These risks include credit risk, liquidity risk and market risk (including currency risk and price risk).

During the year, the liquidity position of the Company was comfortable. The lines of Credit/short term loan available with various banks for meeting the short term working capital/ deficit requirements were sufficient for meeting the fund requirements. The Company has also an overall limit of '100,000 Million for raising funds through Commercial Paper. Cash flow/ liquidity position is reviewed on continuous basis.

Credit risk arises from cash and cash equivalents, investments carried at amortized cost and deposits with banks as well as customers including receivables. Credit risk management considers available reasonable and supportive forwardlooking information including indicators like external credit rating (as far as available), macro-economic information (such as regulatory changes, government directives, market interest rate).

Major customers, being public sector oil marketing companies (OMCs) and gas companies having highest credit ratings, carry negligible credit risk. Concentration of credit risk to any other counterparty did not exceed 5.00% (Previous year 7.88%) of total monetary assets at any time during the year.

Credit exposure is managed by counterparty limits for investment of surplus funds which is reviewed by the Management. Investments in liquid plan/ schemes are with public sector Asset Management Companies having highest rating. For banks, only high rated banks are considered for placement of deposits. Bank balances are held with reputed and creditworthy banking institutions.

The Company is exposed to default risk in relation to financial guarantees given to banks / vendors on behalf of subsidiaries / joint venture companies for the estimated amount that would be payable to the third party for assuming the obligation. The Company’s maximum exposure in this regard on as at March 31, 2023 is '401,168.34 Million (As at March 31, 2022 '389,094.14 Million).

The Company manages liquidity risk by maintaining sufficient cash and cash equivalents including bank deposits and availability of funding through an adequate amount of committed credit facilities to meet the obligations when due. Management monitors rolling forecasts of liquidity position and cash and cash equivalents on the basis of expected cash flows. In addition, liquidity management also involves projecting cash flows considering level of liquid assets necessary to meet obligations by matching

the maturity profiles of financial assets & liabilities and monitoring balance sheet liquidity ratios.

The following tables detail the Company’s remaining contractual maturity for its non-derivative financial liabilities with agreed repayment periods. The information included in the tables have been drawn up based on the cash flows of financial liabilities based on the earliest date on which the Company can be required to pay. The tables include both interest and principal cash flows. The contractual maturity is based on the earliest date on which the Company may be required to pay.

The Company along with its wholly owned subsidiary ONGC Videsh Limited, had set up Euro Medium Term Note (EMTN) Program for USD 2 billion on August 27, 2019 which was listed on Singapore Stock Exchange and subsequently on India International Exchange (India INX) and will mature in December 05, 2029. The EMTN program was updated by the Company along with its wholly owned subsidiaries ONGC Videsh Limited and ONGC Videsh Vankorneft Ltd. on April 19, 2021 for drawdown. However, further update in EMTN program would be carried out depending upon the visibility on the requirement of funds.

The domestic debt capital market was tapped by the Company during FY 2020-21 by issuance of four series of Non-Convertible Debentures (NCD) aggregating to '41,400 Million on private placement basis. Details of NCDs outstanding as on March 31, 2023 are given under Note no 27.2.

Liabilities for Compulsory Convertible Debentures (CCDs) represents maturity profile against CCDs issued by Joint Venture Company ONGC Petro additions Limited (OPaL)amounting to '77,780.00 Million.

The Company has access to committed credit facilities and the details of facilities used are given below. The Company expects to meet its other obligations from operating cash flows and proceeds of maturing financial assets.

# At the year-end, the cash credit limit was '45,000 Million (Previous year '40,000 Million) considering business requirement of the Company. The cash credit limit of ' NIL (Previous year ' NIL Million) was utilized as working capital loan.

Further, at the year-end, the Company had arrangement for facility of loan against term deposit facility was '73,013.50 Million (Previous year NIL). Against the same, the loan against term deposit of '6,289.99 Million (Previous year NIL) was utilized.

Besides the above, the Company had arrangement for unutilized short term loan facilities of '50,000 Million as on March 31,2023 (Previous year '40,000 Million) with other banks.

The Company also had an unutilized limit of '100,000 Million (Previous year '100,000 Million) for raising funds through Commercial Paper.

45.6    Market Risk

Market risk is the risk or uncertainty arising from possible market price movements and their impact on the future performance of a business. The major components of market risk are commodity price risk, foreign currency risk and interest rate risk.

The primary commodity price risks that the Company is exposed to international crude oil and gas prices that could adversely affect the value of the Company’s financial assets or expected future cash flows. Substantial or extended decline in international prices of crude oil and natural gas may have an adverse effect on the Company’s reported results. The management has assessed the possible impact of continuing Ukraine - Russia conflict on the basis of internal and external sources of information and expects no significant impact on the continuity of operations, useful life of Property Plant and Equipment, recoverability of assets, trade receivables etc., and the financial position of the Company on a long term basis. The Company is constantly carrying out macro level analysis and keeping a vigilant eye on global reports & analysis being done by global analyst & firms.

45.7    Foreign currency risk management

Sale price of crude oil is denominated in United States dollar (USD) though billed and received in Indian Rupees C). The Company is, therefore, exposed to foreign currency risk principally out of ' appreciating against USD. Foreign currency risks on account of receipts / revenue and payments / expenses are managed by netting off naturally-occurring opposite exposures through export earnings, wherever possible and carry unhedged exposures for the residual considering the natural hedge available to it from domestic sales.

The Company undertakes transactions denominated in different foreign currencies and consequently exposed to exchange rate fluctuations. Exchange rate exposures are managed within approved policy parameters.

The Company has a Foreign exchange and Interest Risk Management Policy (RMP) with objective to ensure that foreign exchange exposures on both revenue and balance sheet accounts are properly computed, recorded and monitored, risks are limited

to tolerable levels and an efficient process is created for reporting of risk and evaluation of risk management operations.

The primary objective of the RMP is limitation / reduction of risk and a Forex Risk Management Committee (FRMC) with appropriate authority and structured responsibility are in place for the management of foreign exchange risk. The FRMC identifies, assesses, monitor and manage / mitigate appropriately within the legal and regulatory framework.

The Company has a Hedging policy so that exposures are identified and measured across the Company, accordingly, appropriate hedging can be done on net exposure basis. The Company has a structured risk management policy to hedge foreign exchange risk within acceptable risk limit. Hedging

instrument includes plain vanilla forward (including plain vanilla swaps) and option contract. FRMC decides and take necessary decisions regarding selection of hedging instruments based on market volatility, market conditions, legal framework, global events and other macro-economic situations. All the decisions and strategies are taken in line and within the approved Foreign exchange and Interest Risk Management Policy. Since the Company is naturally hedged, hedging decisions are triggered in case of a Net Exposure exceeds USD 500 Million. During the year, no hedging decision was necessitated as net exposure of USD 500 Million was not breached.

The carrying amounts of the Company’s foreign currency denominated monetary assets and monetary liabilities at the end of the reporting period are as under:

Mibor, RBI Repo and USD LIBOR. The Company’s exposure to interest rates are detailed in Note No. 27.

The Company invests the surplus fund generated from operations in term deposits with banks and mutual funds. Bank deposits are made for a period of upto 12 months carry interest rate as per prevailing market interest rate. Considering these bank deposits are short term in nature, there is no significant interest rate risk. Average interest earned on term deposit and a mutual fund for the year ended March 31,2023 was 5.98% p.a. (Previous year 3.39% p.a.).

45.9 Price risks

The Company’s price risk arises from investments in equity shares (other than investment in group companies) held and classified in the balance sheet either at fair value through other comprehensive income (FVTOCI) or at fair value through profit or loss (FVTPL).

Investment of short-term surplus funds of the Company in liquid schemes of mutual funds provides high level of liquidity from a portfolio of money market securities and high quality debt and categorized as ‘low risk’ product from liquidity and interest rate risk perspectives.

The revenue from operations of the Company are also subject to price risk on account of change in prices of Crude Oil, Natural Gas & Value Added Products.

The sensitivity of profit or loss in respect of investments in equity shares at the end of the reporting period for +/-5% change in price and net asset value is presented below:

Other comprehensive income for the year ended March 31, 2023 would increase / decrease by '9,532.24 Million (for the year ended March 31,2022 would increase / decrease by '9,650.05 Million) as a result of 5% changes in fair value of equity investments measured at FVTOCI.

45.10 Fair Value Measurement of Financial Instruments

Some of the Company’s financial assets and financial liabilities are measured at fair value at the end of the financial year. The following table gives information about how the fair values of these financial assets/ and financial liabilities are determined.

45.11 Fair value of financial assets and financial liabilities that are not measured at fair value (but fair value disclosures are required)

The Company considers that the carrying amounts of Financial Assets and Financial Liabilities recognized in the financial statements except as per Note No. 45.10 approximate their fair values.

46.1 Joint Operations

In respect of certain unincorporated PSC/NELP/ HELP/CBM blocks, the Company’s Joint Operation (JO) with certain body corporates have entered into Production Sharing Contracts (PSCs) / Revenue Sharing Contracts (RSCs) with GoI for operations in India. As per signed PSC, RSC & JOA, Company has direct right on Assets, liabilities, income & expense of blocks. Details of these Joint Operation Blocks are

Note: There is no change in previous year details unless otherwise stated.

Abbreviations:- APGIC-Andhra Pradesh Gas Infrastructure Corporation Private Limited, AWEL-Adani Welspun Exploration Limited, BGEPIL-British Gas Exploration & Production India Limited, BPRL-Bharat Petro Resources Limited, CEHL-Cairn Energy Hydrocarbons Limited, CIL-Coal India Limited, EEPL-Essar Exploration & Production Limited, EOGEPL-Essar Oil & Gas Exploration and Production Limited, GAIL-Gas Authority of India Limited, GSPC- Gujarat State Petroleum Corporation Limited, HEPI- Hardy Exploration & Production India Limited, HOEC-

46.1.3 Financial position of the Joint Operation -Company’s share are as under:

The financial statements of 179 nos. (Previous year 154) out of 194 nos. (Previous year 166) Joint operation block (JOs/NELP/HELP) have been incorporated in the accounts to the extent of Company’s participating interest in assets, liabilities, income, expenditure and profit / (loss) before tax on the basis of statements

46.1.5    In respect of 1 Pre NELP block and 2 OALP blocks (Previous year 1 Pre NELP block), the Company’s share of Unfinished Minimum Work Programme (MWP) / Committed Work Programme (CWP) amounting to '6,855.05 Million (previous year '493.81 Million) has not been provided for since the Company has already applied for further extension of period in these blocks as ‘excusable delay’/ special dispensations citing technical complexities, within the extension policy of NELP and as per relevant clause of RSCs of said OALP Blocks, which are under active consideration of GoI. The delays have occurred generally on account of pending statutory clearances from various Govt. authorities like Ministry of Defence, Ministry of Commerce & Industry, environmental clearances, State Govt. permissions etc. The MWP amount of '6,855.05 Million (previous year '493.81 Million) is included in MWP/CWP commitment under note no. 48.2.2 (i).

As per the Production Sharing Contracts/ Revenue Sharing Contracts signed by the Company with the GoI, the Company is required to complete Minimum Work Programme (MWP) / Committed Work Programme (CWP) within stipulated time. In case of delay in completion of the MWP/CWP Liquidated Damages (LD) are payable for extension of time to complete MWP/CWP Further, in case the Company does not complete MWP/CWP or surrender the block without completing the MWP/CWP the estimated cost of completing balance work programme is required to be paid to the GoI. LD amounting to '5.54 Million (Previous year '5.47 Million) and cost of unfinished MWP/CWP amounting to Nil (Previous year nil), paid/ payable to the GoI is included in survey and wells written off expenditure respectively.

46.1.6    Government of India vide its letter dated June 01, 2017 has approved the relinquishment of 30% Participating Interest (PI) of the Company in block RJ-ON/6 and assignment of its future rights and obligations to acquire 30% PI in any of the discoveries in the block in favour of operator Focus Energy Limited(FEL) and other JV partners in proportion to their respective PIs on the condition that Focus Energy Limited (Operator) will reimburse all past cost incurred by the Company towards royalty, PEL/ML fees, other statutory levies and bear the unpaid liability of the Company in development and production cost in SGL Field of the block. Pending the recovery of outstanding dues towards royalty, PEL/ ML fees, other statutory levies, no adjustment in the accounts has been made post relinquishment from the block RJ-ON/6. During the year the Company has

invoked arbitration against FEL and other JV partners to recover its outstanding dues. Total outstanding dues recoverable towards royalty, PEL/ML fees, other statutory levies as on March 03, 2023 is '2,415.90 Million.

46.1.7    The Company is having 30% Participating interest in Block RJ-ON-90/1 along with Vedanta Limited (erstwhile Cairn India Limited) (Operator) and Cairn Energy Hydrocarbons Limited. The Company, as Government nominee under Article

13.2 is liable to contribute its share as per the PI, only for the development & production operations, and is not liable to share Exploration Cost. Operator has recovered exploration cost (beyond exploration phase of PSC) of USD 203.92 Million (equivalent to '16,752.14 Million) being 30% of USD 679.74 Million (equivalent to '55,840.47 Million) up to FY 2021-22 (Previous year USD 167.08 Million and equivalent '12,656.35 Million). The Company has disclosed the sum of USD 203.92 Million (equivalent to '16,752.14 Million) under Contingent Liabilities, as the issues are presently under Arbitration proceedings. Partial award of the arbitration was received during the year and the final award of the arbitration is expected in Q2 2023-24.

Pending finalization of arbitration award, an amount of USD 190.52 Million (equivalent to '15,650.81 Million), which is 30% of USD 635.05 Million pertaining to development and production expenditure have been accounted for as per the participating interest of the Company.

Royalty on production was being paid by the Company as licensee and the JO Partners’ share of Royalty was recoverable through revenue from Sale of Crude Oil and Gas. Accordingly, an amount of '15,583.41 Million outstanding from JV Partners has been included in the revenue up to March 31,2023.

46.1.8    The primary period of twenty five years of the Production Sharing Contract (PSC) of the Block RJ-ON-90/1 expired on May 14, 2020. During the year an Addendum No. 2 to PSC was executed on October 27, 2022 extending the term of the PSC of the block for a period of 10 years retrospectively w.e.f. May 15, 2020.

Government of India demanded payment of Additional Profit Petroleum of USD 654.83 Million C53,794.28 Million) in respect of the Block RJ-ON-90/1 against the audit exceptions as per the PSC provisions. The other Partners in the JO have disputed the demand with a Notice of Arbitration dated May 14, 2020 against the

Government of India. The Company is not a party to the Arbitration against Government of India and will pay the amount, once liability, if any, arises out of the Audit Exceptions is finalized for the Contractors.

The Company share of USD 196.45 Million C16,138.29 Million), being 30% of USD 654.83 Million ^53,794. 28 Million) of the demand for additional profit petroleum on account of Audit Exceptions has been disclosed under Contingent liabilities.

46.1.9 In respect of Jharia CBM Block, revised Feasibility Report (FR) has been approved in the meeting of Steering Committee (SC) held on September 9, 2019. In the light of overlap issue with Bharat Coking Coal Limited Companies and in view of better techno-economics, the Company has decided to implement the revised FR in phases for early implementation and monetization. The Parbatpur and adjoining areas was taken up in Phase-I under the approved FR and accordingly, implementation strategy for Stage-I for Jharia CBM Block has been approved by the Company on November 21,2019 and the Operating Committee (OC) in its meeting held on December 10, 2019. The same was communicated to the JO Partner, Coal India Limited (CIL) and was approved by the Board of Directors of CIL in its meeting held on January 10, 2020.

As per Performa provided by DGH, all the formalities for enhancement of participating interest (PI) from 10% of CIL to 26% have been completed by both the Company (Assignor) and CIL (Assignee) and the signed documents were submitted to DGH for the approval of GoI on January 27, 2020. However, GoI, on the basis of the application and supporting documents has granted enhancement of PI of CIL from 10% to 26% w.e.f. January 25, 2021. This has been contested by the Company as the provision and timing of exercising the option of enhancing PI from 10% to 26% is very clearly defined in the Joint Operating Agreement (JOA) i.e. the option shall be exercised by CIL before the start of Development Phase. Accordingly, DGH and MoPNG has been requested to consider April 23, 2013 which is the start date of development phase activity and the date of commencement of PI enhancement as per JOA, as delay in PI enhancement is primarily due to late submission of requisite documents by CIL. Considering the provisions of JOA and approval of Steering Committee, the cash calls amounting to '707.95 Million from CIL have been continued to be recognized at 26% w.e.f. April 23, 2013 and cash calls

amounting to '272.29 Million at the rate of 10% PI up to January 24, 2021.

46.1.10    In respect of Raniganj (N) CBM Block, the Feasibility Report (FR) exploring different variants to optimize the cost has been worked out for early implementation and monetization, in light of overlap issue with Bengal Aerotropolis Project Limited, CM (SP) Blocks and the Company has decided to implement the Revised FR in stages. The area excluding all overlap issue was taken up in current phase under the approved FR and accordingly, implementation strategy has been approved by the Company on December 8, 2022 and the Operating Committee (OC) on February 13, 2023. Revised Feasibility Report (FR) has been approved inprincipal in the Steering Committee (SC) held on March 3, 2023. Pending final decision on the Block, an impairment provision of '617.75 Million has been provided in the books.

46.1.11    During the year 2017-18 the Company had acquired the entire 80% Participating Interest (PI) of Gujarat State Petroleum Corporation Limited (GSPC) along with operatorship rights, at a purchase consideration of USD 995.26 Million (equivalent to '62,950.20 Million) for Deen Dayal West (DDW) Field in the Block KG-OSN-2001/3. The revised PI in the block after above acquisition stands for the Company 80%, GSPC 10% and Jubilant Offshore Drilling Private Limited (JODPL) 10%.A farm-in Farm-out agreement (FIFO) was signed with GSPC on March 10, 2017 and the said consideration has been paid on August 04, 2017 being the closing date. In the current year 2022-23, accounting for the final closing adjustment (i.e. working capital and other adjustments) to sale consideration viz. transactions from the economic date up to the closing date has been provisionally carried out and a sum of '993.92 Million is net payable to GSPC as final settlement and the same is under deliberation. As per FIFO, the Company is entitled to receive sums as adjustments to the consideration already paid based on the actual gas production and the differential in agreed gas price. Pending executing mother wells and estimating future production, the contingent adjustment to consideration remains to be quantified. The Company has also paid part consideration of USD 200 Million (equivalent to '12,650.00 Million) for six discoveries other than DDW Field in the Block KG-OSN-2001/3 to GSPC towards acquisition rights for these discoveries in the Block KG-OSN-2001/3 to be adjusted against the valuation of such fields based on valuation parameters agreed between GSPC and the Company.

The JO partner JODPL is under liquidation since December 2017 and has defaulted all the cash calls since acquisition of the block by the Company. The amount of outstanding cash call from JODPL as at March 31, 2023 is '1,800.05 Million (Previous year: '1,624.86 Million). The assignment of JODPL’s 10% PI in accordance with provisions of Production sharing Contract (PSC) is pending with Management Committee (MC). As per provision of the Joint Operating Agreement (JOA), the receivable amount of '1,800.05 Million (Previous year: '1,624.86 Million) after the acquisition of block is required to be contributed by the non-defaulting JV Partner in their ratio of participating interest. Pending decision of assignment of JODPL’s PI by MC a provision for an amount of '1,600.04 Million (Previous year: '1,444.32 Million) has been made against the said cash call receivables from JODPL, being the Company’s share as per PI ratios.

46.1.12    In case of Block CB-ONN-2004/3, the discovery well Uber#2 ceased to flow from June 23, 2020. The Company in consultation with JV partner Gujarat State Petroleum Corporation Limited has initiated a proposal for examination / surrendering the block CB-ONN-2004/3 and relinquishment of the development area of 10.78 sq. km. During Management Committee (MC) meeting in May 2022, Government nominee advised to submit firm future plans within 60 days from receipt of the MC approval or else relinquish the field for future bidding round. The proposal for surrender of the block has been initiated by the Company being the Operator for internal approval. Pending approval of the same, an impairment loss of '372 Million has been provided in the books.

46.1.13    The designated currency, for the purpose of cost recovery under the Production Sharing Contracts (PSC) is USD. Thus, the expenditure incurred in Indian Rupees (') needs to be converted in USD for the preparation of cost recovery statements. The Company has already submitted the draft Management Committee agendas for the corresponding blocks for adoption of State Bank of India (SBI) reference rate in place of Reserve Bank of India (RBI) reference rate for preparation of cost recovery statements.

The management committee (MC) of the block named VN-ONN-2009/3 has recommended to the Government for approval of SBI reference rate in lieu of RBI reference rate for the conversion purpose between USD and ' in modification of provision laid down under the PSC. The MC also recommended that

the same may be extended to other similarly placed PSCs of the operator. MC further recommended that the above dispensation to opt for SBI exchange rate may be made available as one time measure also to other operators, should they opt to do so, provided they have adopted SBI exchange rate at the corporate level.

Subsequently, Directorate General of Hydrocarbons (DGH) which is PSC monitoring arm of the Ministry of Petroleum and Natural Gas (MoPNG), Government of India, submitted the proposal for the approval of MoPNG for adoption of SBI reference rate in lieu of RBI reference rate for the block VN-ONN-2009/3 in May 2020 which is at present pending with MoPNG.

The Company is following the SBI reference exchange rates on consistent basis for maintenance of accounts as the main banker of the Company is State Bank of India, and there is no impact on the Company financial statements due to adoption of SBI exchange rate, as the transactions of foreign currency in the Company are recorded at actual cost basis and foreign currency liabilities & assets at period end are also recognised as per SBI reference rate. The financial implication for adoption of SBI reference rate preparation of cost recovery statements with DGH, as against the RBI reference rate is immaterial.

46.1.14 During the year 2021-22 Directorate General of Hydrocarbon had referred issues of 22 NELP blocks relating to cost of unfinished work program (CoUWP) and interest thereon (18 CoUWP plus 4 Interest on CoUWP) of the Company / Consortium of JO to the Committee of External Eminent Experts (CEEE) to act as a conciliator for conciliation proceedings between the Government of India and the Company / its JO-Partners (Contractors) based on the consent of the contractors. Out of the said 22 blocks, the Company is an Operator in 19 blocks and remaining 3 blocks were operated by other Operator(s). The CEEE had various meetings on representations made by the Company and its JO partners during 2021-22 and 2022-23.

CEEE vide its communication dated March 30, 2023 has shared the proposed settlement offers for 10 blocks requesting for observations of the Company and its JO Partners on the same. Subsequently, on the invitation of the Secretary, CEEE, the Company and its JO partners presented their observations on the proposed settlement offers to the CEEE members on April 17, 2023. Further, the Company vide its communication dated April, 21 2023, made written submissions for said 10 blocks for a revised settlement offer for above blocks on the basis of fair

and equitable consideration, by the CEEE.

A meeting of CEEE was held on May 2, 2023 to discuss the submission made by the Company and the CEEE informed that they will further review and propose the revised offers for said blocks. Pending final settlement regarding the 22 blocks, firm liability of CoUWP and interest on CoUWP amounting to '7,127.86 Million and '166.30 Million respectively is carried in the financial statements and disputed balance of CoUWP and interest on CoUWP amounting to '163.94 Million and '942.53 Million respectively is disclosed as contingent liabilities.

46.1.15    Director General of Hydrocarbons (DGH) vide there letter dated April 4, 2017 demanded '645.24 Million towards liquidated damages on account of non-completion of Minimum Work Program within fixed time frame for Shale Gas & Oil exploration & exploitation. The Company in its reply to the demand raised informed that Shale Gas Policy 2013 / Permission letter of the Govt. of India for grant of Shale Gas and Oil exploration/exploitation rights at para V of section-I stipulates withdrawal from shale gas and oil operations after G&G studies, without LD, in case the assessment does not establish shale gas and oil resources. Based on above, liquidated damages is not applicable as assessment through G&G studies in different basins has not established shale gas and oil resources. The same is further reiterated in the Policy Framework for Exploration and Exploitation of Unconventional Hydrocarbons dated August 08, 2018 issued by the Government of India which states that in nomination blocks given to National Oil Companies (NOCs), the NOCs will be allowed to explore and exploit all types of hydrocarbons under the Oilfields (Regulation and Development) Act 1948 and the Petroleum and Natural Gas Rules , 1959 as per existing fiscal and contractual terms of PEL/PML granted under nomination acreages. The shale gas policy of 2013 will be deemed to be modified and /or extended to that extent.

The matter was discussed and followed up in various meetings with DGH / MoPNG. The Company again vide its letter dated August 30, 2022 to DGH submitted that no LD is applicable in the instant case and on the basis of this submission, the matter be considered as closed and no further communication / demand has been received from DGH after the said submissions and accordingly no liability /contingent liability is recognised / disclosed.

46.1.16    During the financial year 2020-21, Director General of Hydrocarbons had demanded '4,881.35 Million on account of unpaid/short payment of

Royalty for blocks KG-OSN-2001/3 and CB-OS/2, consisting of principal amount of '262.41 Million and penal interest of '148.74 Million in respect of Block KG-OSN-2001/3 for the period 2016-17 to 2020-21 and principal amount of '1,209.48 Million and penal interest of '3,260.72 Million on the same in respect of Block CB-OS/2 for the period 2006-07 to 2020-2021.

The Company had taken up with DGH / MoPNG through various meetings and written communications, the last correspondence being letter dated 09th Sep 2021 in respect of the block KG-OSN-2001/3 and 26th Oct 2021 in respect of the block CB-OS/2 and stated that demand raised by DGH is not tenable in terms of various provisions of Production Sharing Contract (PSC) read with statutory provisions of Oilfields (Regulation and Development) Act 1948 (ORD Act) & Petroleum & Natural Gas (PNG Rules) Rules, 2003 and notifications issued thereunder. As per the ORD Act royalty is payable at the prescribed rate of the value obtained at well head. It also provides that the post wellhead cost/ well head price shall be determined based on actual post well head expenditure reported in previous year’s audited accounts. Further as per the provisions of the Production Sharing Contract (PSC) in respect of the block KG-OSN-2001/3, Companies (Lessee) shall be required to pay royalty to the Government (Lessor) at the prescribed rate of the well-head value of Crude Oil and Natural Gas. The Petroleum Mining Lease also provides that the lessee is subject to ORD Act, 1948 (53 of 1948) and the P&NG Rules, 1959. It further provides that the royalty shall be payable by the lessee as per the terms of any contract entered into between the lessee and the Government in respect of the said block/ contract area or at such rates as may be fixed by the Government of India from time to time.

During the financial year 2022-23, DGH vide its letter dated August 5, 2022 has raised a revised demand of '505.37 Million towards unpaid/short payment of Royalty upto March 31,2022 and penal interest upto June 30, 2022 for block KG-OSN-2001/3. DGH has also vide letter dated November 30, 2022, raised demand of '5,416.67 Million towards unpaid/short payment of Royalty upto March 31, 2022 and penal interest upto June 30, 2022 for block CB-OS/2. The matter has again been taken up with DGH / MoPNG through various meetings and it is understood that the matter is under active consideration of MoPNG and the matter shall be resolved soon.

Pending final decision of DGH / MoPNG, the said demands totaling '5,922.04 Million have been disclosed as contingent liabilities.

47 Disclosure under Indian Accounting Standard 36 - Impairment of Assets

47.1    The Company is engaged mainly in the business of oil and gas exploration and production in Onshore and Offshore. In case of onshore, the fields are using common production/transportation facilities and are sufficiently economically interdependent to constitute a cash generating unit (CGU). Accordingly, impairment test of all onshore fields is performed in aggregate at the Asset Level. In case of Offshore, a field is generally considered as CGU except for fields which are developed as a Cluster or group of Clusters, for which common facilities are used, in which case the impairment testing is performed in aggregate for all the fields included in the cluster or group of Clusters.

47.2    The Value in Use of producing/developing CGUs is determined under a multi-stage approach, wherein future cash flows are initially estimated based on Proved Developed Reserves. Under the circumstances where further development of the fields in the CGUs are under progress and where the carrying value of the CGUs is not likely to be recovered through exploitation of proved developed reserves alone, the Proved and probable reserves (2P) of the CGUs are taken for the purpose of estimating future cash flows. In such cases, full estimate of the expected cost of future development is also considered while determining the value in use.

47.3    In assessing value in use, the estimated future cash flows from the continuing use of assets and from its disposal at the end of its useful life are discounted to their present value. The present value of cash flows has been determined by applying discount rates of 16.10% (as at March 31, 2022: 14.74%) for Rupee transactions and 12.16% (as at March 31, 2022: 10.10%) for crude oil, natural gas and value added products revenue, which are measured in USD. Future cash inflows from sale of crude oil, natural gas and value added products have been computed using Management’s estimate of future crude oil, natural gas and value added products prices, discounted applying the rate applicable to the cash flows measured in USD.

47.4    The Company has considered the prevailing business conditions to make an assessment of future crude oil, natural gas and value added product

prices based on internal and external information / indicators of future economic conditions. Based on the assessment, the Company has recorded a net impairment loss to the extent carrying amount exceeds the value in use, amounting to '5,270.26 Million (Previous year: net impairment reversal of '11,904.07 Million), this consist of net impairment loss at Onshore CGUs amounting to '559.68 Million (Previous year: net impairment reversal of '14,746.95 Million) and net impairment loss at Offshore CGUs amounting to '4,710.58 Million (Previous year '2,842.88 Million).

Impairment testing of assets under exploratory phase (Exploratory wells in progress) has been carried out as on March 31,2023 and a net impairment reversal of '20,067.81 Million (Previous year: net impairment loss of '20,830.40 Million) has been provided during the year.

47.6 The Company’s investment in subsidiaries, associates and joint ventures are tested for impairment when there is any significant indication that those investments have suffered an impairment loss. During the year impairment assessment of such investments was carried out and the value in use / fair value of such investments were more than the carrying value and therefore no impairment loss has been provided on such investments.

48. Contingent Liabilities, Contingent Assets and commitments (to the extent not provided for)48.1 Contingent Liabilities & Contingent Assets:

a.    The Company’s pending litigations comprise claims against the Company and proceedings pending with Tax / Statutory/ Government Authorities. After review of all its pending litigations and proceedings, the Company has made adequate provisions, wherever required and disclosed the contingent liabilities, wherever applicable, in its financial statements. The Company does not expect the outcome of these proceedings to have a material impact on its financial position. Future cash outflows in respect of the above are determinable only on receipt of judgments/ decisions pending with various forums/ authorities.

b.    The Company had received demand orders from Service Tax Department at various work centres on account of Service Tax on Royalty in respect of Crude oil and Natural gas. Appeals against such orders have been filed before the Tribunals. The Ahmedabad Tribunal adjourned the matter sine-die vide order dated June 25, 2019, against which the Company has filed writ petition before Hon. Gujarat High Court. In this matter, Hon. Gujarat High Court in the hearing held on January 4, 2021 directed the revenue authorities to file counter affidavit by January 21,2021. The Central Government has filed counter affidavit on January 20,

2021. The next date of hearing before Hon. Gujarat High court is not scheduled as yet. The Company had also obtained legal opinion as per which the Service Tax/GST on Royalty in respect of Crude oil and Natural gas is not applicable. Meanwhile, the Company also received demand order dated January 1,2019 on account of GST on Royalty in the State of Rajasthan against which the Company filed writ petition (4919/2019) before Hon. High Court of Rajasthan. The Hon. High Court of Rajasthan heard the matter on April 3, 2019 and issued notice to Department with a direction that no coercive action shall be taken against the Company. The final hearing has not yet taken place. The Company also filed writ of mandamus (9961/2019) before Hon. High Court of Madras seeking stay on the levy of GST on royalty. The Hon. High Court of Madras heard the matter on April 3, 2019 and issued notice to Central Government and State Government. The Central Government filed their counter affidavit on August 26, 2019. The Company filed additional grounds to the writ petition and filed rejoinder to the counter of the Central Government on January 24, 2020. The Hon. High Court of Madras closed the writ petition in hearing held on July 6, 2022 based on the department’s rejection of Company’s

GST refund applications without further examination on merit. However liberty was granted to challenge the refund rejection order of department in accordance with law, accordingly, an appeal has been filed before the appellate authority challenging the department’s refund rejection order dated June 24, 2022. Disputes are also pending at various forums for various work centres in respect to GST on Royalty.

As an abundant caution, the Company has deposited the disputed Service Tax and GST on royalty along-with interest under-protest amounting to '115,581.52 Million up to March 31,2023 (?87,567.87 Million up to March 31,2022).

The Company shall continue to contest such disputed matters before various forums based on the legal opinion as per which the Service Tax/GST on Royalty in respect of Crude oil and Natural gas is not applicable. However, considering the pending final decision in a similar matter by the Nine Judges’ Bench of Hon’ble Supreme Court, which is yet to be constituted and keeping in view the considerable time elapsed, during the year, the company has reviewed the entire issue of disputed Service tax and GST on royalty and has decided to make a provision towards these disputed taxes as a prudent and conservative practice in respect of the nominated fields, as per agreed terms in JV blocks where there are no disputes amongst the JV partners and to the extent of company’s participating interest in the JV blocks where there are disputes amongst the JV partners. Accordingly, during the year the Company has provided '92,351.14 Million towards disputed taxes for the period from April 1, 2016 to March 31, 2022 together with interest thereon up to March 31, 2023 towards the ST/GST on Royalty and being material has been disclosed as an exceptional item. Further, a similar provision of '28,723.32 Million has also been made during the year for disputed taxes for the financial year 2022-23.

The Company has also obtained a legal opinion from the Additional Solicitor General, Supreme Court of India and other legal expert, with respect to JV blocks where there are disputes with JV partners, as per which the Service Tax/GST, if applicable on royalty, will required to be discharged by the JV partners in their respective share of participating interest in the JV blocks, and pending resolution of the disputes, other partners’ share of disputed ST/GST on Royalty in such JV blocks together with interest up to March 31, 2023 amounting to '43,318.13 Million has not been considered for provision and the same has

been disclosed as contingent liability.

The remaining disputed demand received by the Company towards penalty and other differences i.e. '18,624.60 Million has also been disclosed as contingent liability.

Considering the Income tax experts’ opinion on the subject, the aforesaid amount deposited under protest has been claimed in the Income Tax return / in the ongoing assessment & appellate proceedings, as an allowable expenditure under section 37 read with section 43B of the Income Tax Act, 1961 for the relevant earlier assessment years and has also been considered as an allowable expenditure while calculating the current tax for the earlier years and also towards the current tax for the year ended March 31,2023. The Company has also created deferred tax asset amounting to '879.86 Million in respect of the amounts yet to be deposited against the provision made for disputed taxes for the above periods. (refer Note no. 24.4)

c.    There are certain unresolved issues including cost recovery and sharing in respect of exploration, development and production cost in the Block between the Company and Operator - Vedanta Limited (erstwhile Cairn India Limited) of the Block RJ-ON-90/1. Pending settlement of issues, the Company has shown an amount of USD 203.92 Million - equivalent to '16,752.14 Million (Previous year: USD 167.08 Million - equivalent to '12,656.35 Million) under contingent liability as on March 31, 2023. For further details, please refer Note No. 46.1.7.

d.    The Company, with 40% Participating Interest (PI), was a Joint Operator in Panna-Mukta and Mid and South Tapti Fields along with Reliance Industries Limited (RIL) and BG Exploration and Production India Limited (BGEPIL) each having 30% PI, (all three together referred to as “Contractors”) signed two Production sharing Contracts (PSCs) with Government of India (Union of India) on December 22, 1994 for a period of 25 years. The PSCs for Panna-Mukta and Mid & South Tapti have expired on December 21,2019. In terms of the Panna-Mukta Field Asset Handover Agreement, the Contractors of PMT JV are liable for the pre-existing liability.

In December 2010, RIL & BGEPIL (JV Partners) invoked an international arbitration proceeding against the Union of India in respect of certain disputes, differences and claims arising out of and in connection with both the PSCs. The Ministry of Petroleum and Natural Gas (MoP&NG), vide their

letter dated July 4, 2011, had directed the Company not to participate in the Arbitration initiated by the JV Partners (BGEPIL & RIL). MoP&NG has also stated that the Arbitral Award would be applicable to the Company also as a constituent of the Contract for both the PSCs.

Directorate General of Hydrocarbons (DGH), vide letter dated May 25, 2017 had informed the Company that on October 12, 2016, a Final Partial Award (FPA) was pronounced by the Tribunal in the said arbitrations. As informed by BGEPIL that on issues relating to the aforesaid disputes, additional Audit Award on January 11,2018, Agreement Case Award on October 1, 2018 and Jurisdictional Award on March 12, 2019 were pronounced. However, the details of proceedings of the FPA and other Orders are not available with the Company. DGH, vide their letters dated May 25, 2017 and June 4, 2018, marked to the Contractors, had directed the payment of differential Government of India share of Profit Petroleum and Royalty alleged to be payable by Contractors pursuant to Government’s interpretation of the FPA (40% share of the Company amounting to USD 1,624.05 Million, including interest up to November 30, 2016) equivalent to '133,415.71 Million (March 31, 2022: '123,021.60 Million). In response to the letters of DGH, the JV partners (with a copy marked to all Joint Venture Partners) had stated that demand of DGH was premature as the FPA did not make any money award in favour of Government of India, since quantification of liabilities were to be determined during the final proceedings of the arbitration. Further the award had also been challenged before the English Commercial Court (London High Court). Based on the above facts, the Company had also responded to the letters of DGH stating that pending finality of the order, the amount due and payable by the Company was not quantifiable. In view of the Company, if any changes are approved for increase in the Cost Recovery Limit (CRL) by the Arbitral Tribunal as per the terms of the PSCs the liability to Government of India (GOI) would potentially reduce.

The English Court has delivered its final verdict on May 2, 2018 following which the Arbitral Tribunal reconsidered some of its earlier findings from the 2016 FPA (Revised Award). The GOI and JV Partners have challenged parts of the Revised Award before English Court. On February 12, 2020, the English Court passed a verdict favouring the challenges made by BGEPIL and RIL and also remitted the matter in the Revised Award back to Arbitral Tribunal for reconsideration. BGEPIL has informed that the Tribunal issued a

verdict in January 2021, favouring BGEPIL/RIL on the remitted matter, which was challenged by the GOI before the English Court. The English Court delivered its verdict on June 9, 2022 dismissing the GoI’s challenges and upholding the Revised Agreements Award. The GOI filed an appeal against the English Court verdict of June 9, 2022 that was rejected by the English courts in August 2022.

Based on the information shared by BGEPIL, GOI has also filed an execution petition before the Hon’ble Delhi High Court seeking enforcement and execution of the October 12, 2016 FPA. In January 2018, the Company along with the JV partners had filed an application with MC for increase in CRL in terms of the PSCs. BGEPIL / RIL contend that GOI’s execution petition is not maintainable and have opposed the reliefs sought by the GOI under the said petition. The hearings in the matter before the Hon’ble Delhi High Court concluded on August 4, 2022. Final orders on the reliefs sought by the GOI is awaited.

The application has been rejected by MC. Pursuant to the rejection, the JV partners have filed a claim with Arbitral Tribunal. One of the JV partners has further informed the Company that the hearing before the Arbitral Tribunal has been partially heard during the quarter of October - December 2021. Substantial hearings have taken place since 2021 in respect of the Cost Recovery Limit increase applications filed by BGEPIL & RIL and an award is presently expected by Q4 2023-24 i.e. Jan - March 2024.

DGH vide letter dated January 14, 2019 has advised to the contractors to re-cast the accounts for Panna-Mukta and Mid and South Tapti Fields for the year 2017-18. Pending finalization of the decision of the Arbitral Tribunal, the JV partners and the Company had indicated in their letters to DGH that the final recasting of the accounts was premature and thus the issues raised by DGH may be kept in abeyance.

During the financial year 2010-11, the Oil Marketing Companies, nominees of the GOI recovered USD 80.18 Million (Share of the Company USD 32.07 Million equivalent to '2,634.55 Million (March 31, 2022: '2,429.30 Million)) as per directives of GoI in respect of Joint Operation - Panna Mukta and Tapti Production Sharing Contracts (PSCs). The recovery is towards certain observations raised by auditors appointed by DGH under the two PSCs for the period 2002-03 to 2005-06 in respect of cost and profit petroleum share payable to GOI (refer Note no. 15.1).

Pending finality by Arbitration Tribunal on various

issues raised above, re-casting of the financial statements and final quantification of liabilities, no provision has been accounted in the financial statements. The demand raised by DGH, amounting to USD 1,624.05 Million equivalent to '133,415.71 Million@ '82.15 i.e. closing rate as on March 31, 2023 (March 31,2022: '123,021.60 Million) has been considered as contingent liability.

The Company’s share of USD 32.07 Million '2,634.55 Million @ '82.15 i.e. closing rate as on March 31, 2023 (March 31, 2022: '2,429.30 Million) recovered by Government of India has been disclosed under Note No.15 in the financial statements.

e. The Company is operating various Petroleum Mining Leases (PML) granted by the State Government (s) after initial clearance from the Government of India (Gol). The grant of oil mining lease is regulated and governed by the provisions of the Oilfields [Regulation and Development] Act 1948 (ORD Act). Once the lease order is granted, the lessee has to execute lease deeds with the respective State Government. The stamp duty on the executed lease deed is payable as per the Stamp Act of the respective States. Certain State Governments are of the view to include the amount of Royalty apart from other payments like Security Deposit, surface rent and dead rent etc. for the purpose of calculation of stamp duty under the Stamp Duty Act (s) applicable for such States.

However, the Company is of the view that the royalty payable by the Company is not a rent to the State Government(s) but is payable under Rule 14 of the Petroleum and Natural Gas Rules, 1959 (PNG Rules). There is a distinction between the concept of rent and royalty. The word “royalty” signifies in mining lease that part of reddendum which is variable and depends upon the quantity of minerals gotten or the mineral worked out within a specified period. Whereas rent is the amount payable for use and occupation of land. Hence, it could be reasonably assumed that for the purpose of calculation of stamp duty, amount of royalty would not form part of the consideration value of lease deeds to be executed for PML granted. Ministry of Petroleum and Natural Gas, Government of India communicated to the State Government of Tamil Nadu vide letter dated December, 31,2014, that royalty should not be taken as a basis for fixation of Stamp Duty to the mining leases granted under the ORD Act read with PNG Rules.

Considering the time taken to resolve the matter, State Government of Assam has formulated a way

out so that the lease may be signed. The Director, Directorate of Geology and Mines, had obtained the approval of the Additional Chief Secretary to the State Government of Assam vide letter dated June 10, 2021 to allow for signing the deeds for petroleum Mining Lease (PML) with companies on the basis of dead rent as was done earlier with the insertion of clause in the deed that balance amount of stamp duty which will accrue after finalization of the method of calculating stamp duty shall have to be paid by the respective companies. The Company has been asked by the Directorate of Geology and Mines, Assam to submit the draft deed for all the pending PMLs for ascertainment of Stamp Duty and execution.

Presently proceedings are going on before Registrar of Stamp, Ahmedabad for ascertainment of Stamp duty payable for execution of mining lease agreements in respect of some of the Mining Lease’s for ascertainment of Stamp duty payable.

The Solicitor General of India, through his opinion dated May 05, 2007, had also opined that the distinction between royalty and rent is well settled. Rent would be payable regardless of whether the property is worked upon or not. On the other hand, royalty is a variable figure. It would depend upon the quantity of mineral obtained. If the mine is not worked upon, rent would nevertheless be payable. Hence, he opined that inclusion of royalty for the purpose of calculation of stamp duty is unjustified and not tenable. In absence of clarity on the issue the amount of firm liability or contingent liability is unascertainable.

48.1.2    A contingent asset is a possible asset that arises from past events and whose existence will be confirmed only by the occurrence or non-occurrence of one or more uncertain future events not wholly within the control of the entity. During the normal course of business, several unresolved claims are currently outstanding. The inflow of economic benefits, in respect of such claims cannot be measured due to uncertainties that surround the related events and circumstances.

48.2    Commitments48.2.1 Capital Commitments:

Estimated amount of contracts remaining to be executed on capital account:-

i)    In respect of Company: '115,409.12 Million (Previous year '126,849.43 Million).

ii)    In respect of Joint Operations: '39,542.56 Million (Previous year '60,403.60 Million).

'1,766.85 Million (Previous year '1,699.28 Million).

(iv) As per the directions of the Ministry of Environment, Forest and Climate Change, Government of India, the Company is required to carry out certain activities under the Corporate Environment Responsibility, which include infrastructure creation for drinking water supply, sanitation, health, education, skill development, roads, cross drains, electrification, including solar power, solid waste management facilities, scientific support and awareness to local farmers to increase yield of crop and fodder, rain water harvesting, soil moisture conservation works, avenue plantation, plantation in community areas etc. The commitments towards these activities are worked out on the public hearing conducted, social need assessment etc. for grant of environment clearance for development or commissioning of Green Field and Brown field project of the Company. The Company has outstanding commitments towards the aforesaid activities amounting to '2,075.97 Million as on March 31,2023 ('1,959.54 Million as on March 31,2022), the Company is required to spend the committed amount towards the aforesaid activities during a period of seven years from the date of grant of Environment Clearances as Validity of EC is for seven years and further extendable by three years.

Formula used for computation of:

a.    Current Ratio = Current assets / Current liabilities.

b.    Debt Equity Ratio = Total borrowings / Total equity.

c.    Debt Service Coverage Ratio = Earnings before interest, tax and exceptional item / [Interest on borrowings (net of transfer to expenditure during construction) + Principal repayments of Long Term borrowings].

h.    Net capital turnover ratio = Revenue from operations / Working Capital.

i.    Net Profit Margin (%) = Profit for the period / Revenue from operations.

j.    Return on Capital employed = Profit Before Interest, Dividend Income & Tax (PBIT excluding Dividend income) / Capital Employed.

k.    Return on investment = (Closing balance + Interest + Dividend - Opening balance +/- cash flow during the period)/Average investment

53.1    Additional Regulatory Information/disclosures as required by General Instructions to Division II of Schedule III to the Companies Act, 2013 are furnished to the extent applicable to the Company.

53.2    Certain improvements / changes have been made in the wordings of some of the Significant Accounting Policies for improved disclosures, understandability and clarity. However, such changes have no impact on the Standalone Ind AS financial statements.

54. The Company has a system of physical verification

of Inventory, Property, Plant & Equipment and Capital Stores in a phased manner to cover all items over a period of three years. Adjustment differences, if any, are carried out on completion of reconciliation.

55.    The Company did not have any long term contracts including derivative contracts for which there were any material foreseeable losses.

56.    The Company has a system of obtaining periodic confirmation of balances from banks and other parties. Further, some balances of Trade and other receivables, Trade and other payables and Loans are subject to confirmation/reconciliation. Adjustments, if any, will be accounted for on confirmation/ reconciliation of the same, which will not have a material impact.

57.    Previous year’s figures have been regrouped, wherever necessary, to confirm to current year’s grouping.

58.    Approval of financial statements

The Standalone Financial Statements were approved by the Board of Directors on May 26, 2023.