Though this is sharply lower than its capex levels in recent years, the cut is milder than most analysts expected.

Nearly Rs 18,000 crore of this investment would be made towards exploration and development. “The capex plan has been firmed up and we have informed the government. We have to drill more oil and gas,” ONGC director (finance) AK Srinivasan told FE.

“Of course, we are cautious on the crude oil price. However, the lower crude price would help us to get cheaper services,” he added.

Petroleum minister Dharmendra Pradhan is understood to have reviewed ONGC expenditure programme recently.

Recently, Moody’s Investors Service placed the ratings of 120 oil and gas firms, including ONGC, on review for downgrade. Brent crude, the global oil benchmark, rose 1.1% to $35.17 a barrel on London’s ICE Futures exchange on Friday. ONGC shares have lost more than 34% of their value since 2015 while the benchmark Sensex has declined 10% during the period.

In the current financial year, ONGC aims to spend Rs 30,000 crore towards capital expenditure. It had cash and cash balances to the tune of Rs 15,000 crore as on December 30. The explorer had estimated capex of Rs 36,249 crore in FY16 and Rs 34,000-35,000 crore in FY17. The PSU explorer’s capex between FY11 and FY15 was a massive Rs 1.5 lakh crore, but analysts believe it couldn’t show a commensurate rise in production partly because a large part — about 60% — of these investments was used for maintaining the existing production infrastructure and explorations that haven’t produced immediate results.