Oil India Ltd

Dear Shareholders,

On behalf of the Board of Directors of the Company, I take great pleasure in presentingthe 51^st Annual Report on the working of the Company for the financial yearended 31^st March, 2010 along with the Audited Statement of Accounts,Auditors’ Report and the Review of Accounts by the Comptroller and Auditor General ofIndia.

Your Company has just completed its glorious eventful 50 years of its existence on 18^thFebruary, 2009 and is heading towards the century with renewed vision, commitment anddedication of all Oil Indians.

Initial Public Offering (IPO)

OIL IPO alongwith the disinvestment by Government of India has been a landmark andmemorable event in OIL’s illustrious history. OIL came up with a public offer of2,64,49,982 equity shares, for cash consideration @ Rs. 1050 per share (Face value of Rs.10 per share at a premium of Rs. 1040 per share) through 100% Book Building Method. Theissue opened on September 7, 2009 and closed on September 10, 2009. It received anoverwhelming response from the investors.

The listing of OIL Shares on the National Stock Exchange and Bombay Stock Exchange wasa defining moment for all Oil Indians. All activities were meticulously planned andexecuted with clinical precision. It was a collaborative effort of all the members of theIPO Team which resulted in accomplishment of the various tasks undertaken.

Navratna Status

Your Company, which was a Category-I, Miniratna PSE since 1997, has scaled anotherheight by acquiring the prestigious Navratna status during the first quarter of thecurrent fiscal The grant of Navratna status is in recognition of the tireless efforts andcontribution of all the Oil Indians towards helping the nation in attaining hydrocarbonself-sufficiency and is expected to bring competitive advantages and support in its driveto eventually become a global giant.

Excellent MoU Rating

Your Company has been rated, "Excellent" in MOU for the year 2008-09 and isexpected to be rated at the same level during 2009-10.

New Discoveries:

Your Company has made a total of six new hydrocarbon discoveries in Upper Assam basinduring the year.

Heavy Oil Production in Rajasthan

Your Company has successfully produced heavy oil from two of the existing wells inRajasthan with in-house expertise & efforts during the year, where some heavy oilreserves are locked up for want of appropriate technology.

Production and Sale

Your Company has set another record of achieving the highest ever production of crudeoil and natural gas at 3.572 MMT and 2415 MMSCM respectively leading to the highest salesturnover of Rs.7905.55 crore during the year.

Profit after Tax (PAT)

The Company has set a new record of 20.76 % increase in PAT of Rs.2610.52 crorecompared to the previous year.

Net Worth

Your Company continues to maintain the unique distinction amongst the operating giantsin the N.E. Region with a steady growth in achieving a Net Worth of Rs.13,763.79 crore andearning a Profit After Tax of Rs 2610.52 crore despite allowing subsidy sharing discountsto the tune of Rs 1548.82 crore to PSU Oil Marketing Companies in the price of Crude Oiland LPG as per the administrative order of the Ministry of Petroleum and Natural gas.

Acreage

Your Company holds domestic and international acreages as follows:-

Upto NELP VII we have participating interests in twenty-one blocks of which we are theoperator in nine blocks.

In NELP VIII bidding round, your Company competed and bagged acreages for another nineblocks, PSCs for which have recently been signed with the Govt. of India. Of these nineblocks, we are the operator in three blocks of which one is offshore, one is onshore andwe are joint operator in one deep water block and have a participating interest in theremaining six blocks. In CBM IV bidding round, your Company competed and bagged acreagefor one CBM block in North East India.

Physical Highlights

The performance in respect of the key parameters of the Company for the year ended on31.03.2010 in comparison with the previous year is furnished below:

* Highest ever for the company

Status of Reserves

(a) The status of proved, developed oil reserves and proved gas reserves of the Companyas at 31.03.2010 is as follows:

* To the extent of participating interest of the Company

# Reserves are based on the volume for which MoUs/Contracts have been signed withcustomers. Against the addition/ revision of 1.0080 MMKL-OE during 2009-10, the geologicalaccretion of natural gas during the same year is 4.9456 MMKL-OE.

Financial Highlights

TABLE-I (Rs. in lakhs)

a) The Shareholders’ Funds as on 31.03.2010 was Rs. 13763.79 crore against longterm loan amount of Rs. 37.50 crore giving a Debt: Equity Ratio of 0.0027:1 against0.0061:1 in the previous year. b) Earnings per Share (EPS) had increased to Rs. 113.78 in2009-10 compared to Rs 101.01 in 2008-09.

Dividend

Your Company paid an interim dividend @ 180 % (previous year 150%), based on theprovisional financial trend of the Company. The Board of Directors is now pleased torecommend a final dividend @ 160% on the paid up capital making the total dividend of 340% (Previous year 305 %) for the year, subject to the approval of the shareholders at theensuing Annual General Meeting. It is also proposed to transfer the balance of Rs 1655.52crore to the General Reserve.

3.0 DISCOVERY OF OIL AND GAS

The following oil and gas discoveries were made during the year.

South Tinali-2 (Loc. DGN)

The well South Tinali-2(Loc.DGN) located southeast of Shalmari field in the SouthTinali Structure was drilled to probe the prospect within Tipam Formation. The well hasencountered a few hydrocarbon bearing sands within Tipam Formation. This discovery hasopened up a new area for exploration within Dumduma ML area.

Disaijan-1 (Loc. BGB)

The well Disaijan-1 (Loc. BGB) located to the north-east of Baghjan area was drilled asa vertical well on a fault closure to Disaijan structure to probe the hydrocarbonprospects within Paleocene-Lower Eocene Formations. The well has encountered fewprospective sands within Narpuh, Lakadong + Therria and Langpar Formation. The discoveryof oil in this well has opened up a new area for exploration within Baghjan ML area.

NHK-583- West Jaipur ( Loc. NKV)

The well NHK-583(Loc.NKV) located towards north-west of Jaipur Structure of NahorkotiyaExtension ML was drilled to delineate the limit of extension of the lower Tipam Formation.The well has encountered few hydrocarbon bearing sands within the Tipam and Barailformation.

Umatara -1 (Loc. DGG)

The exploratory well Umatara-1 (Location-DGG) located towards east of Shalmari fieldbetween Tinali and Jaipur structures in Dumduma Extension PEL was drilled to probe theprospect of Tipam Formation as well as Barail Formation.

Hapjan-55 (Loc HRU)

This exploratory location was proposed to probe hydrocarbon prospects of Tipam andBarail formations of HJN-21 Block, lying to the south of main Hapjan structure underHugrijan ML. The well has encountered a number of hydrocarbon bearing sands within Tipam& Barail Formation. Dhulijan (NHK-581) : Location HTF (NHK-581) lies inDhulijan structure to the south- west of Hapjan structure. The Dhulijan structure is anindependent anticlinal closure bounded by two faults one at the south and one at the west.The well has encountered few hydrocarbon bearing sands within Tipam Formation.

Jaisalmer PML area

Gas fields of Tanot, Dandewala & Bagi Tibba are lying within this PML. The gasproduced in this area is being supplied to RRVUNL through GAIL (India) Limited’spipeline for generation of electricity. New gas supply agreement has been entered withRRVUNL with enhanced price of gas for supply @ 0.90 MMSCMD against the average currentwithdrawal level of approximately 0.654 MMSCMD over three years.

Baghewala PML area

Heavy Oil field of Baghewala is located in this PML area. We have a technological tieup with M/s Petroleos de Venezuela SA (PDVSA) of Venezuela for exploitation of thisprospect. On completion of its Integrated Reservoir Study under phase-I, PDVSA indicated53 MMT (Indicated Category) oil-in-place in upper carbonate and 78MMT(25 MMT-provedcategory) oil-in-place in lower Bilara + Jodhpur sand stone. In phase–II, theproduction efforts through steam injection had to be suspended due to teething problemsencountered in surface facilities. Work over carried out by in-house effort in well(BGB-4) during August-October, 2009 produced 30 bbl / day of cold production.Subsequently, post work over Baghewalla-1(BGB-1) also fl owed during February, 2010 withthe assistance of Sucker Rod Pumping. A pilot well is planned in the future on whosesuccess the development plan will be implemented.

NORTH EAST FRONTIER PROJECT Ningru ML: (Area: 540.668 SqKm)

The Mining Lease expired in November, 2003. MOP&NG accorded approval for re-grantof PML for another 20 years. However, Ministry of Environment and Forest directed StateGovernment of Arunachal Pradesh(SGoAP) to obtain a fresh proposal from OIL in accordancewith the provision of Forest Conservation Act, 1980 by paying Net Present Value (NPV) fordiversion of the forest area covering the entire ML area for mining operation which isbeing contested by OIL. Since the matter is sub-judice, further drilling plans have beensuspended.

Ningru ExtensionML: (Area: 75 Sq Km)

OIL applied for re-grant of Ningru Extension ML in June 2003. MoP& NG recommendedre-grant of PML for another 20 years. Approval from SGoAP is still awaited. Since thematter is sub-judice, further activities have been suspended.

Namsai : (Area:370 sq km). The PEL validity was till April, 2010 and furtherextension has been applied for.

The well at North Kimchai-1 (NSA) was spudded-in during December, 2009. We havecompleted drilling to a depth of 5016 metres by end March, 2010. Presently we arearranging for production testing of the well.

Namchik: (Area:195 Sq Km). The PEL validity was till April, 2010:

The released well location at Namchik-1 (NCK) could not be drilled due to nonavailability of Forest Clearance, which is awaited from SGoAP. Deomali (Area 113.50sq km): The PEL is valid up to 03.04.2011. We are arranging to acquire fresh seismic datafor generation of drilling prospects;

Brahmaputra River Bed

OIL had applied for grant of separate Brahmaputra River Bed (BRB) PEL for an area of2754* Sq Km on 09.08.2007 OIL plans to carry out 1,700 GLKM of 2D seismic survey inparts of river Brahmaputra in Upper Assam as a part of its hydrocarbon explorationactivities. A few NGOs and Public Organizations had expressed their concern for the surveyapprehending ecological imbalance in river Brahmaputra, particularly threat to riverdolphins present in the river. MOP&NG formed a Multidisciplinary Advisory Group (MDAG)consisting of experts on the subject to study the various aspects and also to guide OilIndia Limited (OIL). MDAG along with the expertise from Canada (M/s Jasco) is planning toundertake Impact Assessment Studies in two phases, which has however been deferred pendinggrant of the PEL.

PELs under special dispensation

An extension of time was obtained to complete the work programs towards certain PELsgranted on Nomination basis. The status of the same is furnished below:-

NELP BLOCKS / PRE-NELP BLOCKS

The Company, up to the end of NELP VII bidding round, is holding Participating Interest(PI) in a total of 21 NELP & 2 Pre NELP blocks as detailed below:-

Upper Assam Basin

AA-ONN-2002/3 (Karbi Anglong NELP-IV) AA-ONN-2003/3 (Sadiya NELP-V) AA-ONN-2004/1(Amguri NELP-VI) AA-ONN-2004/2 (Dibrugarh NELP-VI)

In Karbi-Anglong 2D seismic survey resumed during December, 2009 subsequent torestoration of the normal working atmosphere in this insurgency prone area. The progresstill March, 2010 end was about 82 GLKM. Similarly, in Sadiya 3D seismic survey resumed inDecember, 2009 and progress till March 2010 end was about 202 SQKM. In Amguri, the firstwell Amguri-1 (Loc.AMG-1) was completed without any encouraging result and currently thecivil work on the second location is in progress. 2 nos. drilling locations in Dibrugarhblock namely, Loc-A (DRA) and Loc.-C (DRB) have been released. Civil work is in progressat the first location DRA while the other location falls under the forest area for whichclearance is awaited.

Assam-Arakan Basin

MZ-ONN-2004/1 (NELP-VI)

Despite difficult logistic and remote road connectivity, data acquisition through 2Dsurvey is under progress. A total of 962 GLKM (403 GLKM in 2009-10) of data has beenacquired so far. Interpretation of available 2D seismic data by M/s Fugro

Geosciences Limited is in final stage. Gravity Magnetic and Geodetic surveys are inprogress. Parallel actions are on for hiring of a suitable drilling rig and associatedservices for drilling and testing 5 nos. exploratory wells in Mizoram, towards which,against a global EOI, a bidder’s conference was held in Kolkata in February, 2010.Actions are in hand for hiring an international expert for project monitoring and expertsupport services.

Mahanadi Basin

MN-ONN-2000/1 (NELP-II)

In this Onshore block in Orissa, a well at location Sadhupur-1 was drilled during2008-09 without success in Phase-II. The OC and MC have decided not to enter Phase-III andhave relinquished the block.

Krishna Godavari Basin

KG-ONN-2004/1 (NELP-VI)

The 3D seismic survey commenced in March, 2010 and 38 Sqkm were acquired during2009-2010. Scrutiny of offers received against EOI for hiring of drilling rig, associatedservices and consultancy services for well engineering and well site supervision have beencompleted. Pre-bid conference on civil related works was held on March, 2010.

Rajasthan Basin

We are presently operating in the following three blocks:-RJ-ONN-2004/2, (NELP-VI)RJ-ONN-2004/3 (Rachan NELP-VI) RJ-ONN-2005/2) (Kalibhar NELP-VII)

Exploratory works in these blocks are at different stages as per the scheduled workprogram. Interpretation of 3D seismic data acquired in both NELP-VI blocks is in the finalstage of completion. In addition, preparation for drilling the first well at location RBAEin the block RJ-ONN-2004/3 (NELP-VI) is in progress. Preparations for acquisition of 3Dseismic data for the NELP-VII block are under progress. During the year, the followingthree blocks have been surrendered due to low prospectivity after completion of committedMWP and post drilling evaluation.

RJ-ONN-2000/1 (Pinodah NELP-II) RJ-ONN-2001/1 ( Siyasar NELP-III) RJ-ONN-2002/1(Rajasar NELP-IV)

NON-OPERATED NELP BLOCKS

OIL with other consortium partners has held participating interest in 12 NELP blocks.Out of these, four blocks are in onshore areas in Assam and West Bengal basins, remainingeight blocks are in offshore (including deepwater) in the Mahanadi, Krishna-Godavari andCauvery and Andaman basins as shown below. In all these NELP blocks exploratory works arein progress and are at different stages of Minimum Work Programme:

Assam-Arakan Basin

Works in AA-ONN-2001/3 & AA-ONN-2002/4 were suspended due to problems arising outof an acreage demarcation dispute between two States in case of the former and due toForest department instructions in case of the latter. In case of AA-ONN-2005/1 the PEL isawaited.

West Bengal Basin

In WB-ONN-2005/4 legacy geoscientific data of the block has been studied. Currentlyacquisition of 3D seismic data is in progress.

Mahanadi Basin

MN-OSN-2000/2: Declaration of Commerciality (DOC) was submitted on 22.12.2009. Reviewof DOC by DGH is in progress. MN-DWN-2002/1 : Arrangement for drilling of exploratory wellMDW#9 (TD 6500 m;WD 2549 m) by Rig DDKG -1 is in progress.

Krishna-Godavari Basin

In KG-DWN-98/4. MWP in all phases has been completed. Three dry wells have been drilledto date. Review is in progress. In KG-DWN-2002/1 Phase –I MWP has been partlycompleted as only one well (dry) out of four could be drilled due to rig moratorium.

In KG-DWN-2004/5 2D acquisition and processing is completed. Interpretation of 2Dseismic data is in progress as per program. In KG-DWN-2004/6 2D Seismic data acquisitionand processing has been completed. Interpretation of 2D seismic data and 3D acquisition isin progress as per program.

Cauvery Basin

In CY-DWN-2001/1, MWP has been completed except drilling of the third well due to rigmoratorium. Two wells drilled were dry.

Andaman basin

In AN-DWN-2005/1, arrangement of acquisition of 2D seismic and GM data in the block isin progress.

PRE-NELP BLOCKS

AAP-ON-94/1 (1998)

M/s Hindustan Oil Exploration Ltd (HOEC) is the operator and OIL has a participatinginterest of 16.129% with further carried interest of 30%. The block has Dirak Discovery(Area–14 Km² & Pay– about 100 m). 3D API has been completedduring fiscal 2010 and three additional prospects have been identified. Appraisal wellsare planned to be drilled. A 2000 HP drilling rig is being hired for the program. GK-OSJ-3(2001) Reliance Industries Ltd (RIL) is the operator for this offshore block and OIL has aparticipating interest of 15%. Work has been suspended due to rig moratorium.

Kharsang Oil Field In Arunachal Pradesh

The Company with a Participating Interest of 40%, entered into a PSC with theGovernment of India in consortium with M/s Geo Petrol International Inc, France (25%), M/sJubilant Enpro Ltd., India (25%) and M/s Geo Enpro Petroleum Ltd, India (10%) on16.06.1995. The field produced 98583 tonnes during 2009-10 (previous year 66,099 tonnes)of Crude oil. 3D seismic API is nearing completion and exploratory drilling of one well toprobe the deeper prospects in the Tipams is planned for fiscal 2011.

Venezuela:[ SA(PDVSA)-60%, OVL-11%, IOCL-3.5%, OIL-3.5%, Rapsol -11%, PETRONAS-11%]

Your Company has recently acquired 3.5 % of Participating Interest in a Mixed Companyto be formed with CVP, a subsidiary of state oil company, PdVSA, Bolivarian Republic ofVenezuela. The Mixed Company will be responsible for developing two blocks, Carabobo -1North & Central, of Extra Heavy Oil in Orinico heavy oil belt. A consortium of ONGCVidesh Limited, Indian Oil Corporation Limited, Oil India Limited, Repsol and PetroliamNasional Berhad (collectively, the "Consortium"), was selected by the Governmentof the Bolivarian Republic of Venezuela during February 2010 for awarding a 40% ownershipinterest, which will develop the Carabobo 1 Norte and Carabobo 1 Centro blocks located inthe Orinoco Heavy Oil Belt, Venezuela. The Corporacion Venezolana del Petroleo("CVP"), a subsidiary of Petroleos de Venezuela S.A. ("PDVSA"),Venezuela’s state oil company, will hold the remaining 60% equity interest. Theformal contract was executed on 12 May, 2010.

A wholly owned subsidiary of OIL has been created at Sweden named as OIL INDIA SWEDENAB (OILSWED). OILSWED has 50% share in a joint venture created with IOCL at theNetherlands named INDOIL NETHERLANDS BV (INDOIL). INDOIL will hold 7% in the Mixed companyat Venezuela (3.5% of OIL and 3.5 % of IOCL). The liabilities of INDOIL will equally beshared with IOCL.

OILSWED is also in the process of creating a wholly owned subsidiary at Cyprus forextending the loan facilities under the Carabobo Project to INDOIL.

Wells are intended to initially produce "cold" and then with thermal recoverymethods. The crude oil thus produced will be diluted, treated and transported throughpipeline to the industrial complex at Soledad, in the south of the state of Anzoategui,where it will be processed in an upgrading plant to recover diluents and generate anupgraded crude oil. The upstream production facilities are expected to produce around400,000 barrels per day of heavy oil of which approximately 200,000 barrels per day willbe upgraded into light crude oil and mixed with the remaining 200,000 barrels as finalproduct. The license term will be for 25 years with the potential for a further 15 yearextension. The project costs are estimated at US$ 15 - 20 Billion dollars.

Iran: Exploration Service Contract- Farsi Offshore[ OVL 40%,(operator), IOCL40%,OIL 20%] Gas Commerciality for Farzad-B area has been approved by National Iranian OilCompany (NIOC). OVL has submitted a draft Master Development Plan (MDP) to IranianOffshore Oil Company (IOOC) and the second round of negotiation on the draft plan andDevelopment Service Contract was held in December, 2009 at New Delhi. Another round ofdiscussion/ negotiations is held up for acceptance of MDP by NIOC and additional proposedchanges expected to be incorporated soon.

Sudan: Product Pipeline [OVL-90 %, (operator) & OIL -10 %] Further tocompletion of the product pipeline, the consortium has received two instalments during theyear from MEM, Sudan, totalling nine instalments so far out of eighteen instalments.

6.1 OPPORTUNITIES FOR INORGANIC GROWTH

As part of continuous efforts on inorganic growth , your Company has been continuouslyscouting /evaluating various upstream opportunities and presently is actively pursuingproducing properties in Australia, Russia, Kazakhstan and Italy .

Libya: Area 86 , and Block 102/4 [OIL-50%(Operator) & IOCL- 50%]

OIL as operator of the consortium has completed the 2D and 3D seismic API of both theacreages. The first well has since been completed . The well failed to encountercommercial hydrocarbons and was abandoned. The drilling of the second well in the area isin progress. Drilling phase of Block 102(4) will start after completion in Area 86.

Libya: Area 95/96 [Area 95 ,96( 4 blocks)] [Sonatrach-50% (Operator),OIL-25% &IOCL -25%] Currently, 2D and 3D seismic survey acquisition are in progress.

Gabon: Block Shakti [OIL-45% (Operator), IOCL-45% & Marvis Petroleum-10%]

OIL as operator of the consortium has so far completed acquisition of 2D seismic dataof about 1000 GLKM in the area. Interpretation of processed 2D seismic data is in finalstages. Arrangements are in hand for carrying out 3D seismic survey in the area.

Nigeria: Block OPL-205 [JV M/s Suntera Nigeria 205 Ltd.-70%(Operator ) & M/sSummit Petroleum(30%)]

OIL has 25% equity holding in M/s Suntera Nigeria 205 Ltd. along with Suntera ResourcesLtd.(50%) and IOCL(25%). M/s Suntera Nigeria 205 Ltd.holds 40% particticipating interestand further 30% economic interest in Block OPL-205 . The JV has since drilled 1 well Otein-2 inside the acreage as part of the work commitment. The well failed to encounterhydrocarbons and was abandoned. Subsequently, based on the presence of existinggas/condensate discovery within the block, the lease area has been converted as OML 142.However formal decree from Nigerian Government is still awaited.

Yemen: Block Nos. 82 & 83 [Medco Energi-38.25 % (Operator), Kuwaitnergy-21.25%, OIL-12.75%, IOCL-12.75%, YOGC -15%] The PSC agreement with Yemen governmentwas executed in April, 2008 and has been approved by the Yemen Parliament in February2009. Actions are on hand by the operator to commence the MWP commitments of the blocks.

Timor- Leste (East Timor): Area-K [Reliance Energy Limited-75%(Operator),OIL-12.5%, IOCL-12.5%] The Farm-in-agreement was executed during June, 2008. Aspart of MWP, the operator has already completed the API of 1300 sq km 3D seismic data.Drilling of the commitment well is expected in the early part of third quarter of 2010.

Egypt: Block Nos. 3 & 4 (GRPC-50% & operator, OIL -25% and IOCL – 25%)

OIL in consortium with GSPC and HPC was successful in winning 2 blocks offered byGANOPE, Egypt. The draft agreement has been forwarded to GANOPE. The Consortium is waitingfor signing of the PSC to commence the committed work programme.

Coal Liquefaction Project

Final report towards the feasibility study by M/s. Headwaters CTL (HCTL), USA wassubmitted in July, 2009 and after deliberations,HCTL team made a presentation to OIL inDecember,2009. LOA was issued during April,2009 for preparation of Short DFR / PFS by EILfor setting-up a 10,000 bpd capacity commercial CTL plant. The Draft PFS, since submittedto OIL, is under examination. Syncrude, derived from Assam coal during Phase-II studies,has been sent to IOCL-R&D, laboratory at Faridabad for product evaluation andcharacterization study. This study is essential to upgrade the products to marketablespecification. The study is in progress at Faridabad.

9.0 - Crude oil production:

OIL has been maintaining an increasing trend in indigenous crude oil production in therecent past. A number of measures in its main producing fields in Assam and ArunachalPradesh are underway to increase productivity. A few of them are listed below:-

Dehydration Plant, Moran CTF: Construction work has been completed in all respectsand commissioning is expected during 2010-2011.

OCS Bhogpara: The Contract for construction of the tanks deferred due to litigationresulting in delay; however, activities are expected to commence during 2010-2011.

Additional EPS at Barekuri and at Makum: All materials have been procured forrespective EPSs. Currently, land acquisition and contract preparation is in progress forboth and construction is expected to commence during 2010-2011.

Pipeline-8 inch x 42 Km (Crude Oil): Baghjan to Secondary Tank farm (TF), Duliajan.Material procurement and receiving is in progress. Simultaneously, the laying contract isunder finalization and expected to commence execution during 2010-2011.

State-of-art OCS at Barekuri: Land acquisition has been completed and the area isbeing developed. Contract preparation is in progress. Construction is expected to commenceduring 2010-2011.

Storage capacity augmentation ITF at Tengakhat: Tender for construction contractwas fl oated but single bidder quoted unreasonably higher than our internalestimates.Hence the tender was cancelled and is being re-fl oated. Construction job isexpected to commence in 2010-2011.

- Natural Gas Production

OIL is presently producing on an average around 6.0 MMSCMD of natural gas from itsUpper Assam & AP fields to meet its internal requirements and market commitment ofapprox 5.0 MMSCMD. OIL has committed to supply 1.0 MMSCMD natural gas to NumaligarhRefinery by 2010 and 1.35 MMSCMD of Natural Gas (feedstock fuel) to Brahmaputra Crackerand Polymer Ltd. by April, 2012. A number of actions are underway for development of thegas production potential and infrastructure development for collection and distributionnetwork involving considerable investments. It is planned to enhance production potentialfrom the present level to nearly 10.0 MMSCMD in the north-east mainly from non-associatedgas source by additional drilling and work over to meet the future requirement of naturalgas and to compensate for calorific value to consumers in post-cracker scenario and thecushion gas required for operational fl exibility. In order to meet the demand the Companyhas initiated various time bound actions for development of Non-Associated Gas fields anddistribution network infrastructure. A few of them are listed below: Gas InfrastructureDevelopment: Drilling of development gas wells, conversion of wells to gas wells throughwork over, de-bottlenecking pipeline network system and augmentation of compressorcapacity for optimum utilization of available gas thereby reducing gas fl aring to aminimum.

Construction of Gas Gathering Station

Construction of a Central Gas Gathering Station (CGGS) at Madhuban ( well 50), Duliajanis in progress including a few Field Gas Gathering Stations (FGGS) for N.A. gas wellproduction.

Development of gas network for supply of natural gas to BCPL.

Pipeline (Natural gas)-16 inch x 37 Km Baghjan to well 50, Duliajan. Materialprocurement and its receipt is in progress. Simultaneously, the contract is nearingfinalization and is expected to commence execution in 2010-2011.

Pipeline (Natural gas)-16 inch x 20KM Chabua to Madhuban (well 50), Duliajan. Materialprocurement and its receipt is in progress. At the same time, contract is nearingfinalization and is expected to commence execution in 2010-2011.

Pipeline - 6" dia x 60 Km: Gas pipeline from Kumchai to Dumduma to evacuate the flared gas at Kumchai is planned.

- Liquefaction of Natural Gas

Since the discoveries made in recent past are located in remote areas, though the crudeoil production can be transported by browsers to the proximate processing facilities, theutilization of associated gas is not possible due to the non- availability of localconsumers in those remote areas and evacuation through long distance pipeline is not aviable solution due to the small volumes. In order to utilize and monetise the associatedgas and obviate fl aring and ensure abatement of harmful effects of greenhouse gasemissions, it is envisaged to establish a commercially viable and proven small scaleLiquefied Natural Gas (LNG) plant as a pilot project at Mechaki-II including establishmentof associated facilities like LNG Storage, LNG Transportation, Transportation ofintermediate fraction produced during the liquefaction process along with re-gasificationplant. Based on the success of this small scale LNG plant, OIL may consider extending thetechnology to its other fields. Since there is no market of LNG in the area, the LNG willbe re-gasified and injected into the proximate gas grid. In this context biddersconference has been held with eleven parties and the tender will be fl oated shortly.Theplant shall be commissioned within a period of 2 years from the date of issue of LoI.

- Exploitation of Shale gas

OIL has also initiated the process of examining the prospect for exploitation of shalegas opportunities in the North Eastern Region towards which actions are at hand forappointment of a consultant and collection of data from GSI.

10.0 VIGILANCE

Honesty, Integrity & Transparency are the foundation stones of a trust worthysociety. To propagate this paradigm a number of vigilance awareness programmes andseminars were conducted across the organization in order to inculcate commitment to valuesand redefine the role and responsibilities of the line managers in vigilance activities.Also a booklet on the same was released.

11.0 QUALITY ASSURANCE AND CUSTOMER DELIGHTING

OIL’s improved quality control initiatives in the recent past, by construction ofIntermediate Tank Farm with dehydration facility, have helped to considerably bring downthe BS&W content in delivered crude to the refineries to an acceptable level. Asecondary tank farm with similar dehydration facilities is under construction stage andlikely to be operational from 2012 when the current level of BS&W is expected to matchwith the international standards.

12.0 RESEARCH AND DEVELOPMENT

The Company gives great importance in continuous upgradation of technologies andexpertise in various areas of activities through its own Research & DevelopmentCentre. The details of activities carried out are given in Form - B of this Report.

13.0 INDUSTRIAL RELATIONS

Harmonious and cordial relations were maintained with the employees’ recognizedUnion. The employees’ Union has extended full co-operation and actively participatedwith the Management in sorting out employees’ problems and grievances. There was noincidence of man days loss by unionized employees due to industrial relations problems.

14.0 IMPLEMENTATION OF OFFICIAL LANGUAGE

In pursuit of Official Language Act/Rules of the Govt. of India efforts are continuingtowards increased use of Official Language Hindi in official work. Hindi Workshops wereconducted from time to time so as to enable officers and employees to work in Hindiconveniently and efficiently. Employees were encouraged through incentive schemes toattend Hindi Training Classes, Assamese Classes and to communicate in Hindi. HindiPrabodh, Praveen and Pragya, and Assamese training classes were arranged forexecutives/employees of OIL and other member organizations of TOLIC, Duliajan. TheCompany’s in-house Journal, "OIL News" was published in Assamese/Hindi& English. The Hindi Magazine "OIL KIRAN" was published exclusively to coverall activities related to Implementation of Official Language and to promote Hindi amongstthe employees and the public.

15.0 AWARDS

Your Company was accorded recognition for its meritorious services to its stakeholdersas follows:-

North East Excellence Award

Oil India Limited has been conferred with the "North East Excellence Award"for large enterprises by the Indian Chambers of Commerce at the North East Business Summitin Kolkata on 8^th January, 2010.

Heavyweight Miniratna PSU award

Oil India Limited received the "Heavyweight Miniratna" PSU award at the 2ndDalal Street Investment Journal PSU Award 2010 ceremony at New Delhi.

Rupkar Bota

Shalmari-Dighalia Juva Sangha, an active youth club under Tinghkhong Revenue Circle inDibrugarh District in appreciation of and genuine gratitude to OIL for the CSR projects(with special focus on the ongoing Project Rupantar) presented a special award named"Rupkar Bota" to OIL.

Rashtriya Rajbhasha Patrika Shield

In recognition of the remarkable work regarding propagation of progressive use ofofficial language Hindi and its implementation by generating wide interest amongst Hindireaders, OIL’s in-house Hindi magazine, ‘OIL KIRAN’ was conferred a specialhonour and appreciation by awarding RASHTRIYA RAJBHASHA PATRIKA SHIELD SAMMAN 2009 byRashtriya Hindi Academy, Rupambara.

16.0 RECOGNITIONS

Oil India Hospital (Duliajan) has been recognized as a study centre for the‘Certificate Course in Healthcare Waste Management’ by Indira Gandhi NationalOpen University (IGNOU). This is the only PSU-hospital in the North-East to get thisrecognition. Doctors, nurses, paramedics, health-managers and other professional workersof any discipline with minimum 10+2 academic qualification can apply for this certificatecourse of six month duration. The programme will impart knowledge to the participants inbiomedical waste management not only to prevent spread of diseases but also to preserveour environment and familiarize them on the current laws and practices.This will alsoincrease job opportunities for the local people.

17.0 CORPORATE GOVERNANCE

As stipulated under Clause-49 of the listing agreement, the Management Discussion &Analysis Report and the Corporate Governance Report have been incorporated as separatesections forming part of the Annual Report. The Company also complies with the corporategovernance guidelines enunciated by the Department of Public Enterprises, Government ofIndia, for Government Companies, which has been duly certified by M/s R & DAssociates, Practising Company Secretaries. The Board has enunciated a code of conduct forthe Directors and Senior Management of the organization, which has also been hosted on thewebsite. The same has been circulated to all concerned, who have affirmed compliance withthe code of conduct.

18.0 CHANGES IN THE BOARD OF DIRECTORS

Shri Ashok Anand, Directors (HR&BD) superannuated from the services of the Companyon 30^th April, 2010. The Board wishes to place on record its sincereappreciation of his valuable contribution to the Company.

Shri S.K. Srivastava was appointed as Director (Operations) on the Board of OIL on01.10.2009. In terms of orders of GOI, MOP&NG letter no. O-32011/1/2008-ONG-I(pt-II)dated February 24, 2010, he was appointed as Director General (DG), Directorate General ofHydrocarbon (DGH) on deputation basis. In terms of the above Orders, Shri S.K.Srivastavawas relieved from the post of Director (Operations), Oil India Limited with effect from25.02.2010 (A.O.H).

In accordance with the provisions of the Companies Act, 1956 and the Articles ofAssociation of the Company, Shri. A. K. Luke, Director, Prof. Sushil Khanna, Director andShri. Arun Kumar Gupta, Director retire by rotation and being eligible, offer themselvesfor re-appointment.

Brief resume of the Directors seeking Re-appointment, together with the nature of theirexpertise in specific functional areas and names of the companies in which they hold thedirectorship, number of shares held and the membership/ chairmanship of committees of theBoard, as stipulated under Clause 49 of the Listing Agreement are given in the noticeconvening the 51^st Annual General Meeting of the Company and form part of theAnnual Report.

19.0 STATUTORY REQUIREMENTS

Section 274(1)(g) of the Companies Act, 1956 is not applicable to the GovernmentCompanies. However, none of the Directors of your Company is disqualified as perprovisions of Section 274 (1) (g) of the Companies Act, 1956. Your Directors have madenecessary disclosures as required under various provisions of the Companies Act, 1956 andClause 49 of the Listing Agreement.

Information as required under Section 217 (1) (e) of the Companies Act, 1956 read withCompanies (Disclosures of particulars in the Report of Board of Directors) Rules, 1988 isgiven in Annexure I forming part of this Report. Details of the Employees who drewremuneration exceeding the limits laid down under Section 217 (2A) of the Companies Act,1956 read with the Companies (Particulars of Employees) Rules, 1975 (as amended from timeto time) are attached as Annexure II.

20.0 STATUTORY AUDITORS

The Statutory Auditors of your Company are appointed by the Comptroller & AuditorGeneral of India (C&AG). M/s S R B & Associates, Chartered Accountants,Bhubneshwar and M/s Chatterjee & Co., Chartered Accountants, Kolkata were appointed asJoint Statutory Auditors for the financial year 2009-10.

The Auditors’ remuneration for the year 2009-10 has been fixed at ofRs.8,00,000.00 (Rupees eight lakhs only) each plus travelling and out-of-pocket-expenses,if any, in addition to the aforesaid amount for carrying out the statutory audit for theyear 2009-10 Comments of the C&AG forms part of this Report. There is no qualificationin the Auditors’ Report and there are no supplementary comments by C&AG undersection 619(4) of the Companies Act, 1956. Notes to the Accounts referred to in theAuditors’ Report are self-explanatory and therefore do not call for any furthercomments.

21.0 COST AUDITORS :

Pursuant to the direction of the Central Government for Audit of Cost Accounts, yourCompany appointed M/s Musib & Associates, Cost Accountants, for auditing the costaccounts of your Company for the year ending 31^st March, 2011.

22.0 DIRECTORS’ RESPONSIBILITY STATEMENT:

Pursuant to the requirement under the Section 217(2AA) of the Companies Act, 1956 withrespect to Directors’ Responsibility Statement, it is hereby confirmed that:

(i) In the preparation of the annual accounts for the financial year ended 31st March,2010, all applicable accounting standards had been followed, along with properexplanations relating to material departures;

(ii) The Directors have selected such accounting policies and applied them consistentlyand made judgments and estimates that are reasonable and prudent, so as to give a true andfair view of the state of affairs of the Company as on 31.03.2010 and of the profit of theCompany for the year ended on that date;

(iii) The Directors had taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with the provisions of the Companies Act, 1956for safeguarding the assets of the Company and for preventing and detecting fraud andother irregularities;

(iv) The Directors had prepared the accounts for the financial year ended 31st March,2010 on a ‘going concern’ basis.

23.0 ACKNOWLEDGEMENT

With the initiatives through the renewed Vision of enlarging the Company’scontribution and with our combined zeal, commitment, experience and expertise, yourDirectors look forward to another year of fruitful operations combined with an overallimprovement in efficiency during the year 2010-2011. Your Directors acknowledge theguidance and support of the Ministry of Petroleum & Natural Gas, all other Ministriesand agencies in Central and State Governments.

Your Directors express their gratitude and thanks to the Shareholders, Customers,Suppliers and other business partners/associates for their continued co-operation andpatronage.

Your Directors wish to place on record their deep sense of appreciation for the devotedservices of all Oil Indians for its success.

For and on behalf of the Board of Directors

Sd/-

A. ENERGY CONSERVATION

1.0 Conservation Of Crude Oil

A total quantity of 8211.3 KL of Crude oil was saved /retrieved from differentoperational activities during the year under review by adopting the following measures:

• Use of Oil Soluble Demulsifiers (OSD).

• Use of dual fuel (Natural Gas and Crude Oil as fuel) engine in Crude Oil.

Dispatch Pumps in PS-1 & PS-2 since natural gas is available.

• Regular & proper maintenance of Crude Oil Transportation Trunk/ Branch

Pipelines to minimize pumping power requirement. This is further reduced by treatingthe crude oil with flow improver chemical / heat treatment.

• Water Clarification Plant and use of De-Oiler.

• Retrieved from various pits and sumps.

2.0 Recovery of Condensate

The total volume of condensate recovered from the following work spheres during theyear was about 208996.160 KL which in terms of revenue amounts to Rs.36166.18 lakhs(approx.)

• By the operation of Condensate Recovery Plant (CRP) at Moran, a total quantityof 3070 KL condensate was recovered.

• From Duliajan field 178522 KL of condensate was recovered..

• From Rajasthan project 126.160 KL of condensate was recovered.

• 27278 KL of condensate was recovered from LPG Plant.

3.1 Reduction in natural gas consumption in COCPs at Duliajan and Moran During theyear, the crude oil of both OIL & ONGC was treated with Flow Improver Chemical insteadof thermal conditioning and thereby a substantial amount of natural gas was saved duringthe year 2009-10.

3.2 By re-commissioning of 1 No. motor driven Low Pressure Booster Compressor Package,2500 SCUM of natural gas was saved.

3.3 By commissioning of new 12" dia distribution pipeline from Hapjan to Nagajanthereby 100000 SCUM of natural gas was saved.

3.4 By laying of 100 mm distribution pipeline from Mechaki to Tiuppuk there was asaving of 38000 SCUM of natural gas during the year 2009-10.

3.5 Natural Gas saved in DND-GPC (Glycol Reboiler) was to the tune of 4.45607 MMSCUM inthe Rajasthan Project.

3.6 In Moran oilfields 1.2 MMSCUM of natural gas saved by using 0.7 Kg./sq cmStabilizer gas which was normally fl ared.

4.0 REDUCTION OF GAS FLARE

4.1 About 1.2 MMSCUM very low pressure gas was used as housing fuel instead ofdiverting it to OCS fl aring at Moran fields.

4.2 Approximately 38000 SCUM of high pressure natural gas fl are avoided at wellMechaki 2 by supplying gas through 100 mm NB distribution line to AGCL.

4.3 Approximately 100000 SCUM of natural gas fl are avoided by commissioning new12"distribution line from Hapjan to Nagajan.

4.4 The SCADA project commissioned on 15 March 1998 is presently being used to controlthe gas fl are, accurate gas measurement, monitor consumption of gas as fuel in both OCSsand GCSs and for maximum utilization of produced gas, etc.

5.0 Conservation of Electricity

5.1 Replacement of GLS bulbs with CFL lamps in Rajasthan Project.

5.2 A total of 163 Nos. of 1.5 Ton energy efficient window ACs with rotary compressorsin residential complex let to an estimated energy saving of 215942.4 kwh.

5.3 A total of 80 Nos. energy efficient electronic ballasts in Duliajan resulted in anenergy saving of 1832.008 kWh. 5.4 A total 12 Nos. of 20 W CFL at Moran saved 175.2 kWh.

5.5 Use of gas for preparing distilled water instead of conventional electric boilersresulted conservation of 1920 kWh 5.6 Due to incorporation of capacitor panel a reductionof 2% electrical energy in LPG plant.

6.0 CONSERVATION OF DIESEL (HSD)

Total quantity of about 1671192 KL (amounts to about Rs 543.14 lakhs) of diesel hasbeen conserved during the year under review by adopting the following measures:

6.1 Use of solar lighting at Tanot-GGS (Rajasthan) & Pilot Plant at Baghewala(Rajasthan), resulted in saving of 2.84 KL of HSD.

6.2 By using PDC Bits which cuts down the round trip time and resulting in reduction ofthe rig hours consequently there is considerable reduction in HSD consumption.

6.3 By adopting and continuing cluster drilling techniques, consumption of fuel(particularly HSD) is reduced considerably. Rig dragging were carried out at fivedifferent locations whereby a rig was moved onto next cluster location without any riggingdown operation. This additionally eliminates rig movements which resulted in considerablesaving in HSD consumption.

6.4 By adopting Horizontal Drilling technique, three full plus three part horizontalwell were completed. Production from a horizontal well is three times than that of aconventional well thereby saving in construction cost of two well as well as considerablesaving in HSD consumption.

6.5 By using motor driven hydraulic power unit instead of engine driven hydraulic powerunit for torque up casings during drilling operation resulted in considerable saving inHSD consumption.

6.6 By using nearest available sources for Workover and Water Disposal Wells at 5 Nos.of locations saved substantial amount HSD.

6.7 Average specific fuel consumption of Rig operations has been lowered by the use ofCFL in the mast structures of AC-SCR Rigs.

6.8 By installing 12 Nos. of Tadger in power pack engines reduced fuel consumption by5% of the normal value.

6.9 2 Nos. of Gas Gen sets at Chabua – 3 EPS has resulted in conservation of 18.25KL HSD

6.10 Proper maintenance and judicious/optimum use of engines, vehicles and other fuelconsuming equipment has resulted in substantial savings of HSD.

6.11 Utilisation of Non-Conventional Energy

6.12 A total of 5483.52 KWH equivalent electrical energy was saved by using SolarVoltaic Cells for MART Terminals.

6.13 Maintaining and using PV Cells for area lighting at GGS resulted in significantsaving of HSD.

6.14 Monitoring the JVVNL power consumption with power factor improving capacitor atTVC instead of running DG Set led to conservation of HSD.

6.15 The Solar Lighting System at GGS were well maintained as non-conventional andrenewable sources of energy and an estimated amount of 2340 Ltrs. HSD has been saved.

6.16 2 Nos. Solar Generating sets were installed in 2 Work over Rigs which conservedapprox. 5040 Ltrs. of HSD.

6.17 Installation of Solar System in Jorajan Magazine House for area lighting wascompleted in July, 2009.

6.18 Installation of Solar Distilled at New IC Shop was completed in 2009.

6.19 Installation of Solar Water Heating System in F Type b"lows at Duliajan wascompleted in July, 2009.

6.20 Deployment of MIRUS ring in COD line and flow lines will eliminate burning /heating like the existing field indirect heaters.

7.0 Additional Investment and Planning

The following are the energy conservation projects OIL has planned to undertake infuture:

7.1 14 Nos. of Tadger are to be procured in this F.Y.

7.2 Procurement of 6 Nos. fuel efficient Caterpillars Engines has been initiated asreplacement for existing D-399 Caterpillar Engines.

7.3 2 Nos. CTU, 2 Nos. of non-fired NPU and 2 Nos. of HOPU are being procured.

7.4 By laying 16" gas distribution line from Baghjan EPS an estimated saving ofRs.5 lakh may be achieved. B. TECHNOLOGY ABSORPTION

Necessary information regarding disclosure of particulars with respect to technologyabsorption, adoption and innovation are furnished in "FORM B"

C. FOREIGN EXCHANGE EARNINGS AND OUTGO

CONSERVATION OF ENERGY AS WELL AS COST REDUCTION ACHIEVED THEREOF DURING THE YEAR2009-10

UNIT RATE :

* Taken average cost for 2009-10.

I. SPECIFIC AREA IN WHICH RESEARCH & DEVELOPMENT CARRIED OUT BY THE COMPANY

1. Integration of Geochemical Data into the Petroleum System Model of Upper Assambasin:

In order to integrate the geochemical data related to biomarker analyses of oils andsource rocks generated in the year 2008-09 as part of the project titled "Oil to Oiland Oil to Source Rock Correlation Studies in Upper Assam Basin", it was decided tohire a consultant who has expertise in both geochemical data interpretation and petroleumsystem modeling. Accordingly, action is being taken to hire a consultant for this work.

2. Reservoir Fluid Identification through Geochemical Analysis of Sidewall Cores:

During the year sidewall core samples numbering 745 were received from 29 wells thatwere drilled. All the sidewall core samples were extracted and the extracts were analyzedusing Thin Layer Chromatograph with Flame Ionization Detector and Gas Chromatograph andnecessary interpretation was provided.

3. Surface geochemical prospecting for oil and gas exploration in Mizoram block(MZ-ONN-2004/1):

Surface geochemical survey for 780 samples has been completed in MZ-ONN-2004/1, MizoramBlock using absorbed soil gas technique for demarcation of hydrocarbon prospect areas.

4. Microbial Paraffin Deposition Control in Oil Wells:

Microbial paraffin remediation jobs were carried out in the wells Kuriarbari # 6 andNHK # 493 and the results are encouraging.

5. Study on Low Injectivity Problem in Water Disposal Wells at a Depth Below 1000m:

Developmental work continued with various suppliers for identifying alternate source ofBactericides to arrest SRB in Produced water. Field trials of two alternate sources ofBactericides have been carried out at Kathaloni OCS.

6. Characterization of Produced Water:

Characterization of produced Water from all the Producing Areas of OIL was done withrespect to various parameters like, Oil Concentration, Oil Droplet Size Distribution,Total Suspended Solids (TSS) concentration, Suspended Solids Size Distribution, IronConcentration, Sulphate Concentration, pH, Dissolved Oxygen Content and SRB Activity.

7. Control of Scale Problem in ITF and Shalmari OCS Formation Water Flow lines withSuitable Scale Inhibitor: In order to control scale deposition problem at Shalmari OCS 1and ITF, Tengakhat, dosing of scale inhibitor chemicals continued. Laboratory workcontinued to identify alternate scale inhibitors.

8. Evaluation of Alkali, Surfactant and Polymer (ASP) Flooding for EOR:

Studies with the alternative surfactant formulations supplied by M/s Oil-ChemTechnologies, USA were carried out to ascertain the performance with respect tosolubility, thermal stability and interfacial tension, reduction.

9. Bioremediation of crude oil and oily sludge contaminated soil & water:

Bioremediation with OILZAPER continued at various polluted sites. A memorandum ofunderstanding was also signed with TERI to provide timely service of bioremediation.

10. Phytoremediation of crude oil and oily sludge contaminated soil:

R&D Department has started a collaborative project with Institute of Advanced Studyin Science & Technology (IASST), Guwahati on field application of phyto remediationtechnique for oil and oily sludge contaminated soil. The work has already been started inJorajan # 22 extended Pit with planting of three species of plants (aquatic, semi-aquaticand non-aquatic) and are monitored through laboratory analysis.

11. Ambient air quality monitoring:

Air quality was monitored in and around almost all OIL’s operational areas fromtime to time throughout the year. The concentrations of the priority pollutants on thoseareas were found to be below CPCB’s prescribed limits.

12. ISO 17025 Accreditation of R&D Department: NABL audit team has recommended foraccreditation of R & D Department for another two year term i.e. from April 2009 tillApril 2011. Regular quality checks and internal audits were carried out through out theyear.

13. Coal Liquefaction Project: OIL in collaboration with M/s Headwaters CTL (HCTL),LLC, USA completed process optimization tests, process guarantee run, preliminary coal& residual gasification assessment for hydrogen production, product stabilizationtests and developed the process design and economics for a standalone 44,000 BPDcommercial plant. In addition, a Pre-feasibility study for a mid-sized commercial plant of10,000 BPD was carried out by awarding a contract to M/s Engineer’s India Limitedwith inputs from M/s Headwaters CTL (HCTL), LLC, USA. OIL is also participating in a USDepartment of Energy (DOE) funded up gradation and characterization study on coal derivedliquids to meet refinery specifications.

14. Development of Oilfield Chemical:

Dose optimization of an OSD product was carried out in laboratory and field implementedin Makum OCS, resulting in substantial reduction of consumption of OSD.

15. Flow assurance of Duliajan – Digboi pipeline:

R&D department carried out extensive laboratory studies to find out optimumtreatment conditions (including Flow Improver dosing level) for Kusijan composite crudeand recommended Flow Improver treatment at 300 ppm for this crude.

II. BENEFITS DERIVED AS A RESULT OF THE ABOVE R&D EFFORTS:

1. Basin modeling study will help in identifying new areas to be taken up forexploration and in releasing new locations.

2. The application of reservoir fl uid identification technique has helped inidentifying and delineating oil-bearing and water-bearing zones.

3. Absorbed soil gas technique will help in demarcating prospect areas for hydrocarbonexploration.

4. Microbial treatment for paraffin inhibition in two wells has resulted in reductionof severity of paraffin deposition in producing wells treated.

5. Identification of new bactericide will help in reducing produced water disposalproblems.

6. Characterization of produced water will help in designing formation water disposaltechnique.

7. Development of suitable scale inhibitor will help to control scale depositionproblem at Shalmari OCS 1 and ITF, Tengakhat.

8. ASP studies will lead to identification of proper ASP formation for EOR technique

9. Bioremediation process will help in reclamation of oil contaminated soil.

10. Phytoremediation method is cost effective and environmentally friendly and offers along term solution for ecological restoration of contaminated site. 11. Monitoring ofambient air quality would help to control the air pollution level in various OIL’sinstallations.

12. Implementation of ISO 17025 has resulted in improvement in analysis standard. 13.The current studies will lead to production of synthetic crude from Assam coal.

14. Using the OSD at the reduced optimal dosage implies significant saving in crudetreatment cost at Makum OCS. 15. Flow assurance study will help in the flow assurance ofDuliajan - Digboi pipeline.

III. FUTURE PLAN OF ACTION:

1. Efforts will continue in providing techno-economical solution of the problemfaced by our Company in the areas of exploration, drilling, production and transportationof crude oil and natural gas.

2. Adoption of new technologies and their implementation will be encouraged.

3. Efforts will be made to setup a Biotechnology cell to fulfill the requirement ofmicrobial techniques applied in OIL field operations.

IV. EXPENDITURE ON R&D (Rs / crore)

Yearly Break up of R&D expenditure

Annexure-II PARTICULARS OF EMPLOYEES PURSUANT TO SECTION -217 (2A) OF THE COMPANIESACT, 1956