ONGC backing Make in India to strengthen hydrocarbon industry
With international oil field standard practices and a good safety and performance track records, Indian drillers can justify the Modi Government policies towards ‘Make in India’ initiative. But unfortunately some vested interests are trying to prevent the Modi Government’s ‘Make in India’ initiative from happening in a positive way. Rigs passing safety checks are justified to contribute in the growth of the Indian hydrocarbon sector.
A senior executive of ONGC said, “There is no compromise with safety checks while hiring a rig by ONGC which clearly justifies that ONGC is not relaxing any norms but it is taking a step ahead to support the Prime Minister’s ‘Make in India’ initiative.”
ONGC is a Premier Upstream Company With an Excellent Safety Record in Hiring Offshore Rigs Upstream activity in India has rapidly grown post liberalization with 42 offshore rigs.
Indian offshore drilling companies have always fulfilled the demand of the Indian exploration market since its inception. ONGC has always been an excellent employer of offshore rigs who has been following stringent safety records and best international oil field practices. Offshore rigs are selected to work with ONGC only after the rigs have passed a stringent safety test from a reputable international inspection agency deployed by ONGC. Passing this stringent safety test in inspection is mandatory for any offshore rig whether old, idle or new.
Moreover, there is no idle period clause in any oil company tenders worldwide. ONGC has always encouraged Indian drillers to be participant in the growth story of the Indian hydrocarbon industry.
Maharatna ONGC is the largest producer of crude oil and natural gas in India, contributing around 70 per cent of Indian domestic production. Crude oil is the raw material used by downstream companies like IOC, BPCL and HPCL to produce petroleum products like petrol, diesel, kerosene, naphtha, and cooking gas-LPG.
ONGC is India’s top energy company and ranks 17th among global energy majors (Platts). It is the only Indian company to figure in Fortune’s ‘Most Admired Energy Companies’ list. ONGC ranks 18th in ‘Oil and Gas Operations’ and 183rd overall in Forbes Global 2000. Acclaimed for its Corporate Governance practices, Transparency International has ranked ONGC 26th among the biggest publicly traded global giants.
It is the most valued public enterprise in India, and one of the highest profit-making and dividend-paying. ONGC has a unique distinction of being a company with in-house service capabilities in all areas of exploration and production of oil and gas and related oil-field services.
Winner of the Best Employer Award, a dedicated team of over 33,500 professionals toil round the clock in challenging locations. Moreover, on Thursday ONGC Videsh Ltd has raised $1 billion through a US dollar bonds issue to finance its acquisition of 15 per cent stake in Russia’s second biggest oil field Vankor.
Centre’s Assam royalty order to cost ONGC `300 cr, OIL Rs 1,100 cr
Oil and Natural Gas Corp will have to shell out Rs 392 crore and Oil India Ltd over Rs 1,100 crore after the government ordered them to pay royalty at gross crude oil price and not the net rate they actually realise. “We have to pay a total of Rs 392.50 crore to implement the order to pay royalty to state governments on revised terms from back date of February 2014,” a senior ONGC official said.
Of the Rs 392.50 crore, about Rs 300 crore would go to Assam and another Rs 91.86 crore to Andhra Pradesh. ONGC is already paying royalty at revised terms to Gujarat — the third major oil producing state. For Oil India Ltd, which produces most of its crude oil in Assam, the liability would be Rs 1,100 crore to Rs 1,150 crore. As per government mandate, ONGC and OIL offers discounts on crude oil to make up for a part of the losses refiners suffer on selling cooking gas (LPG) and kerosene at government controlled rates. These discounts also covered diesel till October 2014 when the price of the fuel was deregulated.
So in effect, ONGC/OIL would raise a gross bill based on the prevailing international oil price but their actual realisation was less than that after accounting for the subsidy discount. However, producing states felt ONGC and OIL need to pay royalty on gross billing. Gujarat High Court in November 2013 ruled in favour of the state government and ONGC was asked to pay about Rs 10,000 crore in past royalty dues. This prompted other oil producing states, particularly Assam, to demand a similar treatment. Till the time Congress ruled Assam, Oil Minister Dharmendra Pradhan maintained that the state government will have to approach the judiciary to get similar relief. Now with a BJP government coming to power in the state, his ministry last week issued orders asking ONGC and OIL to pay royalty at pre-discount rates effective February 1, 2014.