MUMBAI: The government has decided to induct Oil and Natural Gas Corporation Ltd (ONGC), India’s biggest oil and gas explorer, also as an equity partner in the proposed joint venture (JV) between Shipping Corporation of India Ltd, Indian Oil Corporation Ltd, Bharat Petroleum Corporation Ltd (BPCL) and Hindustan Petroleum Corporation Ltd (HPCL) that plans to buy and run ships mainly for the use of state-owned oil companies, multiple sources said.
Confirming the development, a Delhi-based government official briefed on the plan said that the induction of ONGC as a partner will “slightly alter” the equity structure of the soon-to-be-incorporated JV company.
Shipping Corporation of India will hold a majority stake of 50 per cent in the joint venture, as decided initially by the government, while Sagarmala Finance Corporation Ltd, a Non-Banking Financial Company (NBFC) dedicated to the maritime sector, will hold a 10 per cent stake on behalf of the Maritime Development Fund – the first equity investment by the ₹20,000 crore fund.
For the balance 40 per cent stake, there will be a rejig of equity to be held by the oil companies with the induction of ONGC into the joint venture company, the government official said, noting that ONGC’s presence in the JV will further bolster its structure and functioning.
The JV led by Shipping Corporation of India intends to buy some 59 ships – through a combination of second hand purchases from the market and newly built vessels from Indian yards – of various types such as very large crude carriers, very large gas carriers, Suezmax and Aframax tankers, medium range tankers and offshore vessels with an investment of as much as ₹15,000 crore over the next five years, a top official from the state-run carrier said previously.
Of the 59 ships, ONGC has the maximum requirement for 28 ships, followed by Indian Oil Corporation with 10, Hindustan Petroleum Corporation Ltd with 7, Bharat Petroleum Corporation Ltd and Mangalore Refinery and Petrochemicals Ltd (MRPL) with six each and Gas Authority of India Ltd with two.
The JV company will adopt a multi-pronged approach for acquiring ships which will be managed and operated by Shipping Corporation of India.
The strategy behind the JV company is that “the state-owned oil companies which need to move their cargo will give a firm commitment to the JV, and all the vessels will be engaged by them.”
“The intention of the JV company is to have long-term (cargo) commitment from oil companies to the JV vessels. The freight or charter hire rates would be linked to the prevailing market indexes for different segments such as crude oil and gas along with a ‘plus-minus’ for which some formula will be worked out. It will be a very fair pricing mechanism so that there is no issue from any side,” Capt B K Tyagi, Chairman and Managing Director, Shipping Corporation of India, told analysts during a conference call on November 10, 2025, to discuss the company’s financial results for the second quarter of FY26.
Earlier this month, ONGC formed an equal JV with Japan’s Mitsui O.S.K. Lines, Ltd (MOL), the world’s second largest fleet owner, to own and operate two very large ethane carriers, estimated to cost some $370 million.
The ships will be used for hauling ethane from the US to the Dahej, Gujarat based petrochemical plant run by ONGC Petro Additions Ltd (OPaL), a subsidiary of ONGC.
