In September 2023, the board of the company had accorded its consent on sustainable capital restructuring of ONGC Petro additions (OPaL).
OPaL is a a joint venture of ONGC, GAIL (India) Ltd. and GSPC with present shareholding of 49.36%, 49.21% and 1.43% respectively.
It is a mega - grass root petrochemical complex consists of a global scale dual feed cracker with downstream polymer units as an integration-cum-value addition project utilizing ONGC’s Naphtha stream from Hazira and Uran plants and C2+ Streams from Dahej Extraction Plant. OpaL is an anchor tenant of Dahej PCPIR, Gujarat and has exported its products to more than 50 countries in the world.
Offering the rationale for the aforementioned capital restructuring, ONGC had said that the fund infusion would not only augment the holding of ONGC in OPaL, but it would also help OPaL become more profitable.
In August this year, the Ministry of Petroleum & Natural Gas, Government of India (GoI), had granted approved to ONGC for infusion of additional equity capital upto Rs 10,501 crore in ONGC Petro. The transaction would also involve conversion of back stopped compulsorily convertible debentures (CCDs) amounting to Rs 7,778 crore and payment of balance amount of Rs 86 crore with respect to share warrants. All this would translate into an outlay of Rs 18,365 crore for ONGC.
Accordingly, this transaction would change the status of OPaL into subsidiary of ONGC with 95.69% equity stake.
"The approval also provides roadmap for OPaL. GoI has also permitted to allocate 50% of the annual gas production from new wells or well interventions in nomination fields of ONGC or upto 3.2 MMSCMD of domestic natural gas, whichever is lower, for providing feedstock support to OPaL, at a price up to 20% above APM price.
APM Price of natural gas per MMBTU is 10% of Indian Crude basket price per barrel of Oil,” ONGC had said in a statement.
Offering an update on the same, in an exchange filing made after market hours on Wednesday (25 September 2024), ONGC said that it has received approval from its board for infusion Rs 10,501 crore equity capital in ONGC Petro additions.
At the same meeting yesterday, the board of the company has also approved the appointment of Arunangshu Sarkar, director (strategy & corporate affairs) as a key managerial personnel of the company with immediate effect.
Maharatna Oil and Natural Gas Corporation (ONGC) is the largest crude oil and natural gas company in India, contributing around 71% to Indian domestic production. It has in-house service capabilities in all areas of exploration and production of oil & gas and related oil-field services. The Government of India held 58.89% stake in ONGC as of June 2024.
The company had reported 15.09% decline in standalone net profit to Rs 8,938.10 crore in Q1 FY25 as compared with Rs 10,526.78 crore in Q1 FY24. Revenue from operations increased 4.29% YoY to Rs 35,266.38 crore in Q1 FY25.
The scrip fell 1.93% to currently trade at Rs 292.80 on the BSE.