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Informist, Friday, Aug. 29, 2025

 

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--ONGC: bp studying Mumbai High data, preliminary indications good
--CONTEXT: Comments by ONGC mgmt at post AGM press meet
--ONGC: Seeing some green shoots on Mumbai High pact with bp    
--ONGC: Don't expect oil prices to fall below $65 per barrel now
--ONGC: See very good case for nuclear energy, waiting for law to be passed
--ONGC:Have cash ready to purchase assets, will buy only at reasonable price
--ONGC: To buy only near-production or production stage overseas assets
--ONGC on Russian oil:Will buy as long as commercially viable, no bar so far
--ONGC: Will buy ethane from the US for our subsidiary
--ONGC: Will buy ethane from US for subsidiary ONGC Petro
--ONGC: Expect Mozambique project to start pumping gas in 2028

 

NEW DELHI – Oil and Natural Gas Corp. Ltd.'s asset in Mozambique will start pumping gas from 2028, now that the country has signed a peace agreement with Rwanda, the state-run energy explorer's Chairman and Chief Executive Officer Arun Singh told reporters at a press conference. ONGC holds 16% participating interest in Mozambique's Area-1 liquefied natural gas project through its subsidiaries ONGC Videsh Rovuma Ltd. and Beas Rovuma Energy Mozambique Ltd.

 

The operator of the area had declared force majeure in the project due to a security situation. In July, ONGC's board approved a true-up amount of up to INR 50.82 billion to be spent by its subsidiaries on the project.

 

ONGC's partnership with British firm bp is showing green shoots which the company is optimistic about, Singh said. "Small gains will come. But big gains will take around a year and a half," he said. "That's our contract. It's very clear that two years we are going to allow the developments to happen."
 

Amid falling oil production, the company engaged bp as a "technology service provider" to recharge the production at its Mumbai High oilfield. bp is currently collecting data for study and the preliminary indications are positive, another executive said.

 

BUYING OPPORTUNITY

Singh brushed aside current geopolitical tensions and said the situation could throw up opportunities to buy good assets. If the company comes across an asset priced at an acceptable level, with the right design to suit its future debt plans, ONGC will move in to purchase the asset, Singh said.

 

Few would be willing to purchase assets currently given the geopolitical situation, he said. "We want to be in that category that the world has a little more problem, the asset is a little cheaper, then it will be a golden opportunity for us. Because we have cash," he said. The company would look to leverage its cash position, which very few companies in the world have currently, Singh said.

 

Given a choice, Singh said ONGC would proritise domestic operations over international. "After domestic, if we have good assets, a geopolitically stable environment, in countries which are sure of... if we get reasonable surety that we have a good case, we will not hesitate," he said.

 

ONGC clarified that it would not invest in upstream activities overseas. "As a matter of direction, we have said that exploration in foreign country is not our priority at all. Our priority in foreign country is near-producing asset or producing asset. If you see, most of our assets are near-producing assets," Singh said.

 

On overseas asset purchases, ONGC said it would like to be opportunistic. Asked if it would look at purchasing natural resource assets in Russia, the company simply said it is optimistic about foreign assets, without naming any country. "In foreign assets, we are optimistic. And we will, if we feel it is a strategy, it is the right price, and it serves the country in the right purpose, we will definitely work on it," Singh said.

 

ONGC said oil purchases from Russia would continue despite the current tension between India and the US on the matter. Washington has imposed a punitive tariff of 25% on India for importing oil from Russia, on top of the 25% announced as part of the Trump administration's reciprocal tariffs.

 

While ONGC itself does not import crude oil, its refinery subsidiaries Bharat Petroleum Corp. Ltd. and Mangalore Refinery and Petrochemicals Ltd. do. "You may be aware that there is no sanction on Russia. And there is no, you know, as of now, unless our government decides differently, which is not the case as of now, there is no bar," Singh said. "As long as it is commercial and economic, when you see group of refineries, we will keep buying every drop of oil which comes in the market," he said.

 

The state-run upstream company does not expect crude oil prices to fall below $65 a barrel going forward. 

 

ONGC said it has a good case for venturing into nuclear energy but is awaiting the passage of legislation that would give it more clarity on the economics of such a project, Singh said.

 

ONGC's subsidiary ONGC Petro additions Ltd. will source ethane from the US, another executive said. The company is looking to source between 0.6 million tonnes and 0.8 million tonnes of ethane per annum. However, it is currently trying to resolve the issue of getting a carrier to ship the material, the executive said.

 

The company said production from its Krishna-Godavari-98/2 deep-water oil and gas block in the Bay of Bengal off India's coast is currently 30,000 barrels a day, lower than what it had predicted. "We will be reaching 45,000 (barrels per day) when we add cluster 1 to it," an executive said. "We have already completed some geotechnical, geophysical studies."

 

In the financial year 2024-25 (Apr-Mar), the company's standalone crude oil production grew 1%, reversing the fall in the preceding year. The company expects the production to continue to grow a further 1% in FY26 as well.

 

For the June quarter, ONGC had reported a net profit of INR 80.24 billion on a revenue of INR 320.03 billion. Friday, shares of the company closed marginally up at INR 233.71 on the National Stock Exchange.  End

 

US$1 = INR 88.19

 

Reported by Anand JC

Edited by Rajeev Pai

 

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