Oil and Natural Gas Corporation Information
Oil and Natural Gas Corporation Limited (ONGC) (NSE: ONGC, BSE: 500312) is an Indian state-owned oil and gas company headquartered in New Delhi, India. It is one of the largest Asia-based oil and gas exploration and production companies, and produces around 77% of India's total crude oil production (and around 30% of total demand) and around 81% of natural gas production.[2] ONGC is one of the largest publicly traded companies by market capitalization in India[3] and the largest India-based company measured by profits.[4]
ONGC was founded on 14 August 1956 by the Indian state, which currently holds a 74.14% equity stake. It is involved in exploring for and exploiting hydrocarbons in 26 sedimentary basins of India, and owns and operates over 11,000 kilometers of pipelines in the country. In 2010, it was ranked 18th in the Platts Top 250 Global Energy Company Rankings[5] and is ranked #361 globally in Fortune Global 500 list in 2011.[4]
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History
Foundation to 1961
During the pre-independence period, the Assam Oil Company in the northeastern and Attock Oil company in northwestern part of the undivided India were the only oil companies producing oil in the country, with minimal exploration input. The major part of Indian sedimentary basins was deemed to be unfit for development of oil and gas resources.
After independence, the national Government realized the importance oil and gas for rapid industrial development and its strategic role in defense. Consequently, while framing the Industrial Policy Statement of 1948, the development of petroleum industry in the country was considered to be of utmost necessity.
Until 1955, private oil companies mainly carried out exploration of hydrocarbon resources of India. In Assam, the Assam Oil Company was producing oil at Digboi (discovered in 1889) and Oil India Ltd. (a 50% joint venture between Government of India and Burmah Oil Company) was engaged in developing two newly discovered large fields Naharkatiya and Moraan in Assam. In West Bengal, the Indo-Stanvac Petroleum project (a joint venture between Government of India and Standard Vacuum Oil Company of USA) was engaged in exploration work. The vast sedimentary tract in other parts of India and adjoining offshore remained largely unexplored.
In 1955, Government of India decided to develop the oil and natural gas resources in the various regions of the country as part of the Public Sector development. With this objective, an Oil and Natural Gas Directorate was set up towards the end of 1955, as a subordinate office under the then Ministry of Natural Resources and Scientific Research. The department was constituted with a nucleus of geoscientists from the Geological survey of India.
A delegation under the leadership of Mr. K D Malviya, the-then Minister of Natural Resources, visited several European countries to study the status of oil industry in those countries and to facilitate the training of Indian professionals for exploring potential oil and gas reserves. Experts from Romania, the Soviet Union, the United States and West Germany subsequently visited India and helped the government with their expertise. Soviet experts later drew up a detailed plan for geological and geophysical surveys and drilling operations to be carried out in the 2nd Five Year Plan (1956-57 to 1960-61).
In April 1956, the Government of India adopted the Industrial Policy Resolution, which placed mineral oil industry among the schedule 'A' industries, the future development of which was to be the sole and exclusive responsibility of the state.
Soon, after the formation of the Oil and Natural Gas Directorate, it became apparent that it would not be possible for the Directorate with its limited financial and administrative powers as subordinate office of the Government, to function efficiently. So in August, 1956, the Directorate was raised to the status of a commission with enhanced powers, although it continued to be under the government. In October 1959, the Commission was converted into a statutory body by an act of the Indian Parliament, which enhanced powers of the commission further. The main functions of the Oil and Natural Gas Commission subject to the provisions of the Act, were "to plan, promote, organize and implement programmes for development of Petroleum Resources and the production and sale of petroleum and petroleum products produced by it, and to perform such other functions as the Central Government may, from time to time, assign to it ". The act further outlined the activities and steps to be taken by ONGC in fulfilling its mandate.
1961 to 2000
Since its inception, ONGC has been instrumental in transforming the country's limited upstream sector into a large viable playing field, with its activities spread throughout India and significantly in overseas territories. In the inland areas, ONGC not only found new resources in Assam but also established new oil province in Cambay basin (Gujarat), while adding new petroliferous areas in the Assam-Arakan Fold Belt and East coast basins (both inland and offshore). ONGC went offshore in early 70's and discovered a giant oil field in the form of Bombay High, now known as Mumbai High. This discovery, along with subsequent discoveries of huge oil and gas fields in Western offshore changed the oil scenario of the country. Subsequently, over 5 billion tonnes of hydrocarbons, which were present in the country, were discovered. The most important contribution of ONGC, however, is its self-reliance and development of core competence in E&P activities at a globally competitive level.
A turning point in the history of India’s oil sector was in 1994. While the oil sector was on the backburner of India's political realm for some time, is was brought to the forefront by the privatization of India's leading oil E&P organization, the ONGC. Simultaneously, there were steps taken for the enhancement of production on the Bombay High oil fields as the result of a 150 billion development investment.
One of Asia's largest oil E&P companies, ONGC became a publicly held company as of February 1994, following the Indian government's decision to privatize. Eighty percent of ONGC assets were subsequently owned by the government, the other 20% were sold to the public. At this time, ONGC employed 48,000 people and had reserves and surpluses worth 104.34 billion, in addition to its intangible assets. The corporation's net worth of 107.77 billion was the largest of any Indian company.
After its initial privatization, ONGC had authorized capital of 150 billion: it also met its need to raise 35 billion to invest in viable oil and gas projects. The Asian Development Bank (ADB) had also set a deadline for privatizing and restructuring at 30 June 1994, if loans were to be granted for development of two ONGC projects. As a consequence of the successful privatization, the loans were granted—US$267 million for development of Gandhar Field, and US$300 million for the gas flaring reduction project in the Bombay Basin. The successfully formulated and implemented privatization strategy put ONGC at par with other large multinational and domestic oil companies.
2000 to present
In 2006 a commemorative Coin set was issued to mark the 50th anniversary of the founding of ONGC, making it only the second Indian company (alongside State Bank of India) to have such a coin issued in its honour.
In 2011, ONGC applied to purchase of 2000 acres of land at Dahanu to process offshore gas.[6]
ONGC Videsh
ONGC Videsh Limited (OVL) is the international arm of ONGC. It was rechristened on 15 June 1989. It currently has 14 oil and projects across 15 countries. Its oil and gas production reached 8.87 MMT of O+oEG in 2010, up from 0.252 MMT of O+OEG in 2002/03.
International rankings
- ONGC has been ranked at 198 by the Forbes Magazine in their Forbes Global 2000 list for the year 2007.[7]
- ONGC has featured in the 2008 list of Fortune Global 500 companies at position 335,[8] a climb of 34 positions from rank of 369 in 2007.
- Economic Times 500, Business Today 500, Business Baron 500 and Business Week recognizes ONGC as most valuable Indian corporate, by Market Capitalization, Net Worth and Net Profits.[9]
References
- ^ a b c d e "2010 ONGC Form 10-K". http://money.cnn.com/magazines/fortune/global500/2011/snapshots/6362.html. Retrieved October 7, 2011.
- ^ "ONGC beats China's CNOOC to become Asia's No.1 E&P firm". SINGAPORE: The Economic Times. November 3, 2010. http://economictimes.indiatimes.com/news/news-by-industry/energy/oil--gas/ONGC-beats-Chinas-CNOOC-to-become-Asias-No1-EP-firm/articleshow/6864233.cms. Retrieved 3 November 2010.
- ^ "ONGC one of the most valuable company in India". CNBC-TV18. 14 October 2011. http://www.moneycontrol.com/stocks/marketinfo/marketcap.php?optex=BSE.
- ^ a b "BSE Filings". 26 July 2010.
- ^ Platts, Nov 2, 2010. "Platts Top 250 Global Energy Company Rankings". http://www.platts.com/Top250Home. Retrieved 2010-11-03.
- ^ Lewis, Clara (11 Sep 2011). "ONGC seeks 2K acres govt land at Dahanu". Times News Network. Times of India. http://articles.timesofindia.indiatimes.com/2011-09-10/mumbai/30138777_1_processing-plant-dahanu-gas-block.
- ^ "The Global 2000". Forbes. http://www.forbes.com/lists/2008/18/biz_2000global08_The-Global-2000-India_10Rank.html.
- ^ Fortune 500
- ^ ONGC :: Investor Centre :: Profile
Further reading
- Story of ONGC by I.A.Farooqi gives a historical account of Oil and Natural Gas Corporation from its foundation to the year 2000.
External links
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