Hindustan Oil Exploration Company Ltd Directors Report

To The Members of Hindustan Oil Exploration Company Limited

Your Directors have pleasure in placing before you the 42^nd Annual Report on the business and operations of your Company along with the audited financial statements, for the financial year ended March 31, 2026.

The consolidated performance of the Company and its subsidiaries has been referred to wherever required.

1. FINANCIAL HIGHLIGHTS

($ in lakhs)

	Standalone		Consolidated
Particulars	2025-26	2024-25	2025-26	2024-25
Revenue from operations	24,986.28	30,606.91	26,315.45	42,086.99
Other Income	2,475.89	7,891.09	1,568.81	7,612.35
Total Income	27,462.17	38,498.00	27,884.26	49,699.34
Total Expenses	19,752.98	23,650.67	24,678.66	34,704.21
Profit before share of profit of associate, exceptional items and tax	7,709.19	14,847.33	3,205.60	14,995.13
Share of profit of associate	-	-	-	-
Profit before exceptional items and tax	7,709.19	14,847.33	3,205.60	14,995.13
Exceptional items	3,251.87	-	3,251.87	-
Profit before tax	10,961.06	14,847.33	6,457.47	14,995.13
Tax expense	-	100.04	182.94	274.36
Profit for the year	10,961.06	14,747.29	6,274.53	14,720.77
Other comprehensive income / (loss)	67.83	(38.10)	70.18	(36.36)
Total comprehensive income for the year	11,028.89	14,709.19	6,344.71	14,684.41

Note: The above figures are extracted from the audited standalone and consolidated financial statements prepared as per Indian Accounting Standards (Ind AS)

2. BUSINESS PERFORMANCE

During the year, your Company produced 2.94 BCF of gas and 0.26 million barrels of oil (previous year: 3.78 BCF of gas and 0.35 million barrels of oil) on a standalone basis. In oil equivalent term the production for the current year is 0.85 mmboe (1.06 mmboe in the previous year).

On a standalone basis revenue for the current year decreased to $ 24,986.28 lakhs from $ 30,606.91 lakhs in the previous year primarily because the oil in stock from Block B-80 was not sold during the year. Other income for the current year decreased to $ 2,475.89 lakhs from $ 7,891.09 lakhs in the previous year due to the adjustment of interest income receivable from Adbhoot against B-80 participating interest acquisition cost. Production expenses decreased to $ 22,925.33 lakhs compared to $ 26,327.94 lakhs in the previous year. Total expenses for the current year has decreased to $ 19,752.98 lakhs as compared to $ 23,650.67 lakhs in the previous year driven by an increase in stock adjusted in the total cost. This includes non-cash depreciation, depletion and amortization as well as finance costs towards the unwinding of decommissioning which totaled

$ 4,169.83 Lakhs in the current year compared to $ 4,112.59 lakhs in the previous year.

The profit before exceptional items and tax decreased to $ 10,961.06 lakhs as compared to $ 14,847.33 lakhs in the previous year. The profit after tax decreased to $ 10,961.06 lakhs as against the profit of

$ 14,747.29 lakhs in the previous year.

On a consolidated basis, revenue from operations decreased to $ 26,315.45 lakhs from $ 42,086.99 lakhs in the previous year, mainly due to oil remaining in stock and lower day rates for the operating facilities of Block B-80. The year-on-year comparison was also impacted by intercompany eliminations of revenue and corresponding expenses recognized in the current year following the increase in the Groups interest in Block B-80 from 60% in the previous year to 100% in the current year; no such eliminations were recorded in the previous year. The profit after tax for the current year was $ 6,274.53 lakhs, compared with $ 14,720.77 lakhs in the previous year.

On a consolidated basis, the cash and cash equivalent in the Company as on March 31, 2026 is $ 2,017.96 lakhs, compared to $ 1,457.40 lakhs in the previous year.

Measures taken to improve the operational & financial performance

Your Company has been appropriately addressing the challenges presented by the evolving landscape with renewed vigor, all while ensuring the well-being of our employees and the communities wherein we operate. We remain vigilant in monitoring any material changes in future economic conditions and are committed to effectively managing their impact and associated costs across the organization.

3. OUTLOOK

Your Company has adequate working capital and discretionary capital required for the development of its existing oil and gas blocks. The capital required for exploration would be met by the Companys internal accruals. Additionally, the Company is actively seeking inorganic growth opportunities, which will be risk-weighed before any capital commitments are made, for which the Company may raise additional capital and debt as and when necessary.

4. DIVIDEND

Your Company is currently on a growth trajectory, actively pursuing exploration opportunities while also focusing on the appraisal and development of discoveries within its existing portfolio. To support this growth, the Company requires immediate financial resources. Consequently, your Directors do not recommend any dividend for the year.

The Dividend Distribution Policy framed in accordance with the provisions of the Companies Act, 2013 (the "Act") and the SEBI (Listing obligations and Disclosure Requirements) Regulations, 2015 ("SEBI Listing Regulations") is available on the Companys website at https://www.hoec.com/policies/.

5. DEPOSITS FROM PUBLIC

Your Company has not accepted any deposits from public and as such, no amount on account of principal or interest are outstanding as at the Balance Sheet date.

6. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS

Details of loans, guarantees and investments covered under Section 186 of the Act, forms part of the Notes to the Standalone Financial Statements provided in this Annual Report.

7. CHANGE IN THE NATURE OF BUSINESS

Your Company did not undergo any change in the nature of its business during the year.

8. SHARE CAPITAL

There is no change in share capital during the year. The Company has not issued any shares with differential rights as to voting, dividend or otherwise.

9. SUBSIDIARIES

As on March 31, 2026, we have two (2) wholly-owned subsidiaries viz., Hindage Oilfield Services Limited and Geopetrol International Inc. and two (2) wholly-owned step-down subsidiaries - Geopetrol Mauritius Ltd. and Geoenpro Petroleum Limited. There are no associates or joint venture companies within the meaning of Section 2(6) of the Act.

Hindage Oilfield Services Limited (Hindage), an Indian public unlisted company, operates in the Oil Field Equipment and Services sector. Hindage owns Prem Pride, a Floating Storage Offshore facility with a 900,000 barrel oil storage capacity, which is currently deployed for storage of oil produced from HOECs B-80 offshore field.

Geopetrol International Inc. (GPII), a company incorporated in the Republic of Panama is another wholly owned subsidiary of HOEC which operates through an Indian Project Office.

Geopetrol Mauritius Ltd. (GML), a company established under the laws of Mauritius holding Category I Global Business License, is wholly owned by GPII. GML owns Key Gibraltar - Offshore Installation, which is a customized Mobile Offshore Processing Unit currently deployed in HOECs B-80 field at Mumbai offshore.

Geoenpro Petroleum Limited (Geoenpro) is an Indian public unlisted company, which is co-owned by GML (50%) and Hindage (50%). Geoenpro is an upstream oil and gas company which holds 10% participating interest in Kharsang Field and is operator to the block.

There has been no material change in the business of the subsidiaries. During the year, Hindage & GML were material subsidiaries of HOEC and the Board of Directors of your Company has reviewed the affairs of the subsidiary companies.

In accordance with Section 129(3) of the Act, the Indian Accounting Standards (Ind AS) and relevant provisions of the Listing Regulations, Consolidated Financial Statements of the Company have been prepared which form part of this Annual Report.

Also, a statement containing salient features of the Companys subsidiaries is appended as Annexure - I to the Boards Report in the prescribed Form AOC-1.

Further, as per Section 136 of the Act, the Annual Audited Financial Statements including the Consolidated Financial Statements and related information of the Company and the Audited Financial Statements of the subsidiary companies are available on the companys website, at https://hoec.com/annual-reports/.

10. UNINCORPORATED JOINT VENTURES

The financial statements of the Company reflect its share of assets, liabilities, income and expenditure of the joint venture operations, which are accounted on the basis of available information on a line-by-line basis with similar items in the Companys Accounts, to the extent of the participating interest of the Company, as per various "Production Sharing Contracts" (PSCs) and "Revenue Sharing Contracts" (RSCs). The financial statements of the Unincorporated Joint Ventures are prepared by the respective Operators in accordance with the requirements prescribed under the respective PSCs and RSCs.

11. DIRECTORS AND KEY MANAGERIAL PERSONNEL

The Board of Directors comprises distinguished professionals of proven integrity and competence, who provide strategic direction, guidance and leadership to the Company.

As on March 31, 2026, the Board of Directors of the Company comprised of seven Directors with an optimum balance of Executive and Non-Executive Directors. Of these, six Directors were Non-Executive Directors, three of whom were Independent Directors.

The Company has received necessary declaration from each Independent Director that he/she meets the criteria of independence as laid down under Section 149(6) of the Act and Regulation 25 of the Listing Regulations.

In the opinion of the Board, the Independent Directors fulfil the conditions specified in these regulations and are independent of the management. There has been no change in the circumstances affecting their status as Independent Directors during the year, except has given herein below.

The Non-Executive Directors of the Company had no pecuniary relationship or transactions with the Company, other than sitting fees, commission and reimbursement of expenses incurred by them for the purpose of attending meetings of the Company.

CHANGES IN DIRECTORATE

Resignations:

• Mr. Vivek Rae (DIN: 01866765) resigned from his position as Chairman and Non-Executive Independent Director with effect from the close of business hours on April 17, 2025, due to personal reasons. He confirmed that there were no other material reasons for his resignation.

• Mrs. Bhavani Balasubramanian (DIN: 09194973) resigned from her position as a Non-Executive Independent Woman Director with effect from the close of business hours on February 22, 2026. She confirmed that there were no other material reasons for her resignation.

• Mr. Ramasamy Jeevanandam (DIN: 07046442) resigned from his position as Managing Director with effect from the close of business hours on March 31, 2026, due to personal reasons. He confirmed that there were no other material reasons for his resignation.

The Board places on record its sincere appreciation for the valuable contributions made by Mr. Vivek Rae, Mrs. Bhavani Balasubramanian, and Mr. Ramasamy Jeevanandam during their respective tenures.

Appointments & Re-designations:

• Mr. Suresh Kumar Jain (DIN: 05103064) & Mr. Baroruchi Mishra (DIN: 09223144) were appointed as Non-Executive Independent Directors for a term of five consecutive years effective April 18, 2025. The shareholders approved these appointments through Postal Ballot, the results of which were declared on June 30, 2025.

• Dr. Jagadip Narayan Singh (DIN: 00955107) was appointed as a Non-Executive Independent Director and designated as the Chairman of the Board for a term of five consecutive years effective January 23, 2026. The shareholders approved his appointment through Postal Ballot, the results of which were declared on March 29, 2026.

• Mr. Baroruchi Mishra (DIN: 09223144) was re-designated as a Non-Executive Non-Independent Director of the Company with effect from February 25, 2026, with due approval of shareholders through Postal Ballot, the results of which were declared on March 29, 2026.

Subsequent Board Appointments (After March 31, 2026):

• Mr. Baroruchi Mishra (DIN: 09223144) was appointed as the Managing Director & CEO of the Company with effect from April 01, 2026. The shareholders granted prior approval for this appointment via Postal Ballot, the results of which were declared on March 29, 2026.

• Ms. Preeti Grover (DIN: 00128513) was appointed as an Additional Director in the capacity of Non-Executive Independent Woman Director with effect from May 12, 2026, to fill the casual vacancy caused by the resignation of Mrs. Bhavani Balasubramanian. This appointment was completed within the statutorily prescribed period.

Consequent to the above-mentioned changes, the composition of the Board remains in conformity with the provisions of Sections 149 and 152 of the Companies Act, 2013, read with Regulation 17 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

Retirement by rotation:

In accordance with the provisions of Section 152 of the Companies Act, 2013, and the Articles of Association of the Company, Mr. Ashok Kumar Goel (DIN: 00025350) retires by rotation at the ensuing Annual General Meeting (AGM) and, being eligible, offers himself for re-appointment. The Board recommends his re-appointment for members approval. Necessary details and profile of the Director seeking re-appointment are annexed to the Notice convening the AGM.

CHANGES IN KEY MANAGERIAL PERSONNEL Resignations during the Financial Year:

• Mr. Sivalai Senthilnathan resigned from his position as Chief Financial Officer with effect from March 28, 2026.

• Mr. Ramasamy Jeevanandam (DIN: 07046442) resigned from his position as Managing Director with effect from the close of business hours on March 31, 2026.

The Board places on record its gratitude for the leadership and services rendered by Mr. Ramasamy Jeevanandam and Mr. Sivalai Senthilnathan during their tenures as Key Managerial Personnel.

Composition as on March 31, 2026:

As of the close of the financial year on March 31, 2026, the following officials constituted the KMPs of the Company:

• Mr. Ramasamy Jeevanandam - Managing Director

• Mrs. G. Josephin Daisy - Company Secretary

Note:Consequent to the resignation of the Chief Financial Officer on March 28, 2026, the position remained temporarily vacant at the exact close of the financial year on March 31, 2026, and was filled on the subsequent day.

Subsequent KMP Appointments (Effective April 01, 2026):

The following KMP appointments were approved by the Board based on the recommendations of the Nomination and Remuneration Committee:

• Mr. Baroruchi Mishra (DIN: 09223144) was appointed as Managing Director & CEO with effect from April 01, 2026.

• Mr. Allen Joseph Andrade was appointed as Chief Financial Officer with effect from April 01, 2026.

12. NUMBER OF MEETINGS OF THE BOARD

The Board met eight (8) times during the financial year. The details of meetings are given in the Corporate Governance Report which forms part of this Annual Report. The intervening gap between the meetings was within the period prescribed under the Act and Listing Regulations.

13. POLICY ON DIRECTORS APPOINTMENT AND REMUNERATION

The Board of Directors has framed a policy which lays down a framework for the nomination and remuneration payable to Directors and other Key Managerial Personnel. The details of the policy are stated in the Corporate Governance Report.

14. DIRECTORS REMUNERATION

Details of the remuneration paid to the Executive and Non-Executive Directors of the Company are given in the Corporate Governance Report section of this Annual Report.

15. BOARD EVALUATION

Pursuant to the provisions of the Act and the provisions of the Listing Regulations, Board has carried out an annual evaluation of its own performance, the Committees of the Board and individual directors. The manner in which the evaluation has been carried out is explained in the Corporate Governance Report.

16. COMMITTEES OF THE BOARD

The Board has five (5) Committees, viz., Audit Committee, Nomination and Remuneration Committee, Stakeholders Relationship Committee, Corporate Social Responsibility Committee and Risk Management Committee. The composition of the Board and its Committees are provided in the Corporate Governance Report section of this Annual Report. During the year, all recommendations made by the respective Committees were approved by the Board.

17. RELATED PARTY TRANSACTIONS

All related party transactions that were entered into during the year under review were on an arms length basis and in the ordinary course of business. Disclosures relating to the related party transactions are set out in Note No. 40 of the standalone financial statements and Annexure II of this Report.

18. DISCLOSURE REQUIREMENTS

As per Listing Regulations, the Corporate Governance Report with the Auditors Certificate thereon and the Management Discussion and Analysis including the Business Responsibility and Sustainability Report are set out in separate sections and form part of this Report.

19. ANNUAL RETURN

Pursuant to Section 92(3) read with Section 134(3)(a) of the Act, the Annual Return as on March 31, 2026, is available on the Companys website at https://hoec.com/annual-reports/.

20. MATERIAL CHANGES AND COMMITMENTS

No material changes and commitments which affect the financial position of the Company occurred between the end of the financial year to which the financial statements relate and the date of this Report.

21. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS

There were no material orders passed by the regulators or courts or tribunals impacting the going concern status and the Companys operations in future.

22. DIRECTORS RESPONSIBILITY STATEMENT

The financial statements are prepared in accordance with the Indian Accounting Standards (Ind AS) under the historical cost convention on accrual basis except for certain financial instruments that are measured at fair values, the relevant provisions of the Act and the Rules made thereunder, guidelines issued by SEBI and guidance note on accounting for oil and gas producing activities (Ind AS) issued by the Institute of Chartered Accountants of India.

In terms of Section 134(5) of the Act, your Directors, to the best of their knowledge and belief and according to the information and explanation obtained by them, state that:

(i) in the preparation of annual accounts for the financial year ended March 31, 2026, the applicable accounting standards have been followed and there are no material departures;

(ii) they have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for that period;

(iii) they have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

(iv) they have prepared the annual accounts on a going concern basis;

(v) they have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and operating effectively; and

(vi) they have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

23. AUDIT REPORTS AND AUDITORS

Audit Reports for the financial year ended March 31, 2026:

• The Auditors Reports on the standalone and consolidated financial statements form part of this Annual Report and do not contain any qualification, reservation or adverse remark, except for certain material weaknesses identified in the Companys internal financial controls over financial reporting (IFCoFR) for which Boards explanation is given and forms part of this report.

• The Secretarial Audit Report for the year is included as Annexure III to this Report and it does not contain any qualification, reservation or adverse remark. The Company complies with all applicable Secretarial Standards.

• Your Company has maintained cost records which were duly audited in terms of Section 148 of the Act, read with the Companies (Cost Records and Audit) Rules, 2014. The cost audit report for the financial year ended March 31, 2025 was filed with the Central Government within the prescribed timelines.

• The Internal Auditors findings are discussed, and actions, as required, are taken as per the directions of the Audit Committee on an ongoing basis to improve efficiency in operations.

• Neither the Statutory Auditors nor the Secretarial Auditors have reported to the Audit Committee under Section 143(12) of the Act, any instances of fraud committed against the Company by its officers or employees, the details of which would be required to be mentioned in the Boards Report.

Auditors for the financial year ending March 31, 2026:

Statutory Auditor

At the 41^st AGM of the Company held on September 15, 2025, the Members approved the appointment of M/s. B S R & Co. LLP, Chartered Accountants (Firm Registration No. 101248W/W-100022), as Statutory Auditors for a term of five (5) consecutive years commencing from the conclusion of the 41^st Annual General Meeting till the conclusion of the 46^th Annual General Meeting of the Company.

Secretarial Auditor

At the 41^st AGM of the Company held on September 15, 2025, the Members approved the appointment of M/s. S. Sandeep & Associates, Company Secretaries in Practice, as Secretarial Auditors to conduct the secretarial audit for a term of five consecutive years from FY 2025-26.

Cost Auditor

The Board of Directors have appointed Mr. K. Suryanarayanan, a Cost Accountant in Practice, as Cost Auditor of the Company at a fee of $ 2,50,000 (Rupees Two Lakhs and Fifty Thousand only) plus applicable taxes and out of pocket expenses, subject to ratification of the said fees by the shareholders at the ensuing Annual General Meeting.

Internal Auditor

The Board has engaged M/s. Guru & Ram LLP, Chartered Accountants, as its Internal Auditors. Their scope of work includes review of internal controls and its adherence, statutory compliances, health, safety and environment compliance, compliance towards related party transactions and risk assessments.

24. INTERNAL FINANCIAL CONTROL SYSTEMS AND THEIR ADEQUACY

Based on the framework of internal financial controls and compliance systems established and maintained by the Company, the work performed by the internal, statutory and secretarial auditors, including the audit of internal financial controls over financial reporting by the statutory auditors and the reviews performed by the Board and Audit Committee, the Companys internal financial controls were adequate and effective during the year under review, except for certain material weaknesses identified by the Statutory Auditors in their Audit Report.

Boards Response to the Auditors Qualified Opinion on Internal Financial Control:

With respect to the qualified opinion of the statutory auditors on certain material weaknesses identified in the Companys internal financial controls over financial reporting (IFCoFR) as of March 31, 2026, the Boards explanation is as follows:

a. Material weakness identified:

The Company does not have an appropriate internal control system with regard to periodic confirmation process and reconciliation of trade payable balances including balances outstanding of joint operation (JO) partners which could potentially result in material adjustment in the standalone financial statements.

Boards explanation and remedial action:

The Company has initiated a structured process for periodic balance confirmations and reconciliations with trade payables and JV partners. Management is strengthening validation controls to ensure these reconciliations are conducted systematically. Going forward, this process is being integrated into the regular financial closure and monitoring procedures to ensure timely identification and resolution of variances.

b. Material weakness identified:

The Companys internal control system over year-end financial statement closure process around review of payroll cost (including actuarial valuation), timely computation of year end profit petroleum and depletion expense and presentation and disclosure in the standalone financial statements were not operating effectively which could potentially result in material adjustment in the standalone financial statements.

Boards explanation and remedial action:

The Company is currently upgrading its financial and accounting systems and related processes and is simultaneously restructuring the internal control framework governing year-end closures. The upgraded systems will embed automated checks, reviews, and enhanced management oversight over payroll, actuarial valuation, and depletion expenses. These controls are being implemented progressively to ensure reporting accuracy and timeliness.

Regarding Profit Petroleum, the Company has aligned with the Directorate General of Hydrocarbons (DGH). It has been discussed and agreed that, to ensure timely compliance, Profit Petroleum may initially be computed and paid on a provisional basis. Final adjustments will be accounted for and settled in the subsequent cycle upon completion of the DGH audit.

The Company remains committed to continuously strengthening its internal control environment to ensure a robust and resilient financial reporting framework.

25. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

Our Company is committed to driving technological innovation and environmental responsibility, ensuring that our operations deliver meaningful benefits to all stakeholders, while also advancing both technology and environmental stewardship, thereby ensuring that our operations benefit all stakeholders.

We strive to integrate advanced technologies with sustainable practices across all our operations, ensuring efficiency, safety, and minimal environmental impact. During the year under review, we implemented several key initiatives aimed at conserving energy and driving technological progress. A few of these are listed below:

A) Conservation of Energy:

a) Steps taken or impact on conservation of energy:

In an effort to become more energy efficient, the Company has taken the following steps -

1. BEE Star rated equipment: The Company prioritizes procurement of Bureau of Energy Efficiency (BEE) star-rated equipment wherever feasible, ensuring reduced energy consumption and improved operational efficiency.

2. Reduction of Greenhouse Gas (GHG) Emissions: In alignment with climate change policies, continuous efforts are undertaken to monitor, manage, and reduce GHG emissions through operational optimization and cleaner energy usage.

3. Energy source optimization: Our in-house power requirements are primarily met using natural gas-based generators, with diesel-based generators used only in emergencies. Solar lamps have been installed near the operational areas to optimize energy resource utilization and promote sustainable energy practices.

4. Air emission monitoring: Regular monitoring of emission sources and ambient air quality is carried out to ensure that emission levels remain below statutory limits stipulated by the Central Pollution Control Board.

5. Automatic lighting controls: Automatic timers have been installed for all lights, except emergency lighting, to ensure they are turned off during daylight hours, to minimize unnecessary energy consumption and improve operational efficiency.

6. Timer-controlled equipment: Air compressors and fire water jockey pumps are equipped with timers to minimize runtime and conserve energy.

7. Preventive maintenance: Periodic preventive maintenance and condition monitoring of aging equipment are conducted to extend asset life, reduce premature replacements, and lower energy consumption.

8. Sustainable design and planning: Our project planning and design processes are focused on minimizing environmental impact and maximizing resource efficiency throughout the project lifecycle.

9. Solar street lights: We have installed 355 nos. of solar street lights at selected locations within our operational areas to reduce reliance on traditional power sources.

10. Rainwater harvesting: We have implemented rainwater harvesting systems to recharge groundwater resources at our operational sites.

11. Groundwater quality monitoring: Regular analysis of groundwater samples in our operational areas ensures that water quality meets statutory standards as per Central Ground Water Authority Guidelines.

12. Optimized air conditioning: Air conditioning systems are set to 25?C to optimize power consumption and improve energy efficiency.

13. Greenhouse Gas emission reporting: We calculate and report our greenhouse gas emissions annually, using the HOEC Dirok benchmark for GHG emission as a reference.

14. LED lighting conversion: The transition from sodium vapor lamps to LED fittings has been initiated at the PY-1 site as part of our energy conservation efforts.

15. Employee awareness: Regular awareness programs are conducted to encourage responsible energy use among employees. b) Steps taken by the Company for utilizing alternate source of energy: The Company has successfully installed 355 solar street lamps across our operational areas at Assam. This initiative enhances visibility and safety within these areas while significantly reducing our dependence on conventional power sources. It directly supports our broader goals of energy conservation and carbon footprint reduction.

By harnessing solar energy for street lighting, we are not only lowering energy consumption and operational costs but also reinforcing our commitment to environmental sustainability. This project exemplifies our dedication to integrating renewable energy solutions into our operations and promoting responsible resource management.

c) Capital investment on energy conservation equipment:

In order to enhance operational efficiency and reduce environmental impact, we have successfully replaced the manually operated choke valve with a remote-operated choke valve in one of our high-producing wells at the Dirok field in Assam.

This upgrade offers several key benefits:

• Reduced travel: The remote operation capability eliminates the need for frequent site visits, minimizing travel to well sites and associated logistics.

• Fuel savings: By decreasing travel requirements, we also reduce fuel consumption, further contributing to our sustainability goals.

This initiative not only streamlines operations but also supports our commitment to improving efficiency and reducing our carbon footprint.

d) Impact of the measures mentioned in (a) and (b) above for reduction of energy consumption and consequent impact on the cost of production of goods:

Our commitment to energy efficiency has led to notable reductions in both energy consumption and Greenhouse Gas (GHG) emissions. Key actions contributing to these outcomes include:

• Minimal use of air conditioning: By optimizing air conditioning settings and usage, we have significantly reduced the overall energy demand for cooling.

• Deployment of energy-efficient systems: The implementation of advanced, energy-efficient systems across our operations has further decreased power and fuel consumption.

These measures have not only contributed to a substantial decrease in energy use and GHG emissions but have also resulted in lower operational costs. This aligns with our goal of achieving greater sustainability and efficiency in our operations.

B) Technology absorption:

(a) Efforts made towards technology absorption, adaptation, and innovation:

The Company is committed to adopting innovative approaches to enhance energy efficiency and minimize environmental impact. Our key initiatives include:

• Modular Gas Processing Plant: We have implemented an energy-efficient modular approach for our Gas Processing Plant in Assam. This includes the installation of Variable Frequency Drives (VFDs) on plant, equipment and machinery to optimize energy use. Additionally, we adhere to a Leak Detection and Repair (LDAR) program to monitor and address gas leaks, thereby controlling emissions effectively.

• Elephant corridor protection: To safeguard an Elephant Corridor in Assam, we have laid a 21 km pipeline 1.5 meters below the ground, connecting our Gas Gathering Station (GGS) to the Modular Gas Processing Plant (MGPP). This approach has significantly reduced our ecological footprint in this sensitive area.

• Horizontal flare system: At our MGPP in Assam, we have installed a sonic, natural draft, horizontal flare system with an enclosure. This system is designed to minimize environmental harm and ensure that flare operations are conducted with reduced impact on the surrounding environment.

• Carbon footprint reduction: We are actively working to reduce our carbon footprint through a combination of major and minor process changes. This includes supplying surplus power to the state grid and local tea factories, creating additional carbon sinks through plantation, and adopting green energy sources whenever feasible.

• LED lighting conversion: We are transitioning from conventional lighting to energy-efficient LED lights in a phased manner, which contributes to reduced energy consumption and lower operational costs.

• Technological advancements: We plan to adopt new technologies, such as surface jet pumps (ejectors), to enhance well production efficiency and further improve our operational effectiveness.

These efforts underscore our commitment to sustainability and environmental stewardship, aligning with our goals of energy efficiency and reduced ecological impact.

(b) Technology import made during the last 3 years:

• Details of technology imported: Remote operated choke valve was imported and installed in one of the high producing well.

• Year of import: 2022 & 2024

• Whether the technology been fully absorbed: Yes

(c) No Research and Development expenditure was incurred during the year.

(d) No benefits like product improvement, product development or import substitution were derived during the year.

C) Foreign exchange earnings and outgo:

(a) Activities relating to exports; initiatives taken to increase exports; development of new export markets for products and services; and export plans: Company is engaged in production of crude oil and natural gas. The existing Government policies and Production Sharing Contracts (PSCs), to which Company is a party, is subject to domestic market obligations till self-sufficiency in domestic production of hydrocarbons.

(b) The Foreign Exchange earned in terms of actual inflows during the year and the Foreign Exchange outgo during the year in terms of actual outflows

($ in lakhs)

Particulars	FY 2025-26	FY 2024-25
Foreign exchange earning	Nil	Nil
Expenditure in foreign currency:
- Operating expenditure	4,850.59	6,945.45
- Capital expenditure	89.21	294.66

26. CORPORATE SOCIAL RESPONSIBILITY (CSR)

The Company has in place a CSR policy which is available on our website at https://hoec.com/policies/. A brief outline of the CSR policy of the Company and CSR expenditure incurred during the year are set out in Annexure IV of this Report as per the format prescribed under the Companies (Corporate Social Responsibility Policy) Rules, 2014. The details of the composition and meetings of the CSR Committee are provided in the Corporate Governance Report section of this Annual Report.

27. RISK MANAGEMENT

The Company is responsible for reviewing the risk factors and ensuring effective mitigation and management. The Risk Management Committee identifies and monitors the risks associated with the Companys operations. In addition, the Audit Committee oversees the areas of financial risks and controls.

The development and implementation of risk management policy has been covered in the Management Discussion and Analysis Report, which forms part of this Annual Report.

28. HUMAN RESOURCES MANAGEMENT

Your Company continues to pursue the best practices to develop its human capital by hiring and retaining the best talent. The Company has a transparent performance appraisal system with focus on the organizational objectives aligned with Key Performance Indicators. An objective performance measurement with an assessment of potential and identification of training needs for individual growth are being pursued.

The total permanent employee count, as on March 31, 2026, was 117 and the annualized attrition rate for the year stands at 15.58%.

29. PARTICULARS OF EMPLOYEES

The particulars of employees including their remuneration as required to be reported under the provisions of Section 197(12) of the Act, read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are set out in Annexure V to this Report.

30. PROTECTION TO WOMEN EMPLOYEES

The Company has in place a Corporate Policy on Anti-Sexual Harassment of Employees, in terms of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. An Internal Complaints Committee has also been duly constituted and during the year under review no complaints were received.

31. COMPLIANCE WITH MATERNITY BENEFIT ACT, 1961

The Company is compliant with the applicable provisions of the Maternity Benefit Act, 1961 and has policies, systems and processes in place to ensure ongoing compliance.

32. INVESTOR EDUCATION AND PROTECTION FUND (IEPF)

Pursuant to the provisions of the Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016 (as amended from time to time), all unpaid or unclaimed dividends are required to be transferred by the Company to the IEPF, after completion of seven years. Further according to the said Rules, the shares on which dividend has not been paid or claimed by the shareholders for seven consecutive years or more shall also be transferred to the demat account of the IEPF Authority.

Accordingly, the Company has duly transferred all unclaimed/unpaid dividends and the corresponding shares as per the above requirements to the IEPF and has filed necessary forms with the Ministry of Corporate Affairs in this regard. Details of the same are provided in the Shareholder information section of the Corporate Governance Report and are also available on our website at https://hoec.com/dividend-information/.

33. LISTING ON STOCK EXCHANGES

The Companys shares are listed on BSE Limited and the National Stock Exchange of India Limited and has duly paid the Annual Listing Fees as applicable.

34. ACKNOWLEDGEMENTS

Your Directors place on record their gratitude for the support and co-operation received from the Ministry of Petroleum & Natural Gas, Directorate General of Hydrocarbons, Ministry of Defence, Ministry of Environment, Forests and Climate Change, the State Governments of Assam, Arunachal Pradesh, Gujarat, Maharashtra and Tamil Nadu and the authorities working under them. Your Directors express their gratitude to the Companys stakeholders, shareholders, business partners and bankers for their continuous support. Your Directors appreciate and value the professionalism, dedication and commitment of the HOEC team to overcome any challenges and to drive growth.

	For and on behalf of the	Board of Directors
	Ashok Kumar Goel	Baroruchi Mishra
Date : 11-06-2026	Director	Managing Director & CEO
Place : Chennai	DIN: 00025350	DIN: 09223144