News Post
ONGC in India adopts significantly expanded "Energy Strategy 2040"
The ONGC Board recently approved the business roadmap for the company and its other group entities - 'ONGC Energy Strategy 2040', according to the company's annual report. Its Energy Strategy 2040 envisions the company as a diversified energy company with a strong contribution from non-E&P business.
The roadmap calls for doubling its oil & gas output from its domestic and overseas fields and expanding its refining capacity threefold apart from diversification into renewables. According to ONGC chairman and managing director Shashi Shanker, ONGC Energy Strategy 2040 envisions the company as a diversified energy company with a strong contribution from non E&P business; 3X revenues and about 5-6X market capitalisation.
As per Shanker, the strategic roadmap envisions a future-ready organisation whose growth is predicated on a few important planks: consolidation of core upstream business (domestic and international); expansion into value accreting adjacencies in the oil & gas value chain (downstream and petrochemicals) and diversification into renewables (offshore wind) and select new frontier plays through a dedicated venture fund.
The plan targets cumulative upstream output (local and overseas) almost doubling from current levels with 2% and 5% CAGR in domestic and international operations, respectively.
ONGC produced 24.23 million tonne of crude oil in the 2018-19 and 25.81 billion cubic metres of natural gas from its domestic fields. Another 10.1 mt of oil and 4.736 bcm of gas were produced from its overseas assets.
With two 35 mt per annum of oil refining capacity vested in its two subsidiaries – HPCL and MRPL, ONGC is targeting to raise this capacity to around 90-100 mt,
According to the company officials. The officials said ONGC has plans to make investments in renewable energy sources with a target to create 5-10 gigawatt portfolio with a focus on offshore wind power.
According to analysts, ONGC has been under pressure to reverse the falling output from its aging fields in recent years. As a result of which the company had been forced to invest heavily, while at the same time aggressively look for assets overseas. ONGC is looking forward to investing around Rs 83,000 crore in 25 major projects to boost oil and gas production, which has stagnated over the last few years. The cumulative oil & gas gain from these projects is expected to be over 180 mt of oil and oil equivalent gas in their life cycle.
The company executives said in upstream oil & gas exploration and production, priority would be accorded to select difficult plays (high-pressure high temperature, ultra-deepwater) and low stretch from current core, development of in-house enhanced oil recovery solutions to maximise legacy production, exploration-focused technology partnerships, dedicated marginal fields unit as well as building decommissioning capabilities.
Internationally, the annual report said the focus shifts to plays with volume in host regimes with a positive government-to-government relationship with India to secure stable energy long-term supplies.
Source: ONGC Annual Report 2018-2019
For subscriptions or a demo:
Ed Bramwell
Subscriptions Sales Manager
+44 20 3793 9705
For questions or to give feedback:
Thad Pittman
Senior Researcher
+1 (713) 525-4605
Download our brochure today!
Project News