New Delhi: State-owned Oil and Natural Gas Corporation (ONGC) is planning to set up a trading unit to manage crude oil, petroleum products and petrochemicals produced and procured by its group companies, a top company official said on Tuesday.
“We have created a commodity trading group of oil and gas in ONGC, exclusively for (looking into the aspect of) trading. We are going forward with that and we do see that in the near future trading will be required for India especially with so many sources and so much peak demand occurring with the economy growing,” Rajarshi Gupta, Managing Director of ONGC Videsh Ltd (OVL), the overseas arm of ONGC, said while addressing the 3rd Energy Summit of Indo-American Chamber of Commerce.
Gupta said the proposal is at a conceptual stage and a group has been formed to study the modalities, including operational and legal frameworks.
ONGC currently produces about 42 million tonnes (MT) of crude oil annually, while its subsidiary Hindustan Petroleum Corporation Ltd (HPCL) procures 30-35 MT and Mangalore Refinery and Petrochemicals Ltd (MRPL) buys 18-20 MT. OVL contributes 10.5 MT from its overseas operations.
“So as a group, ONGC has around 100 MT of actual buying and selling of crude oil. If we can get all of this together and do something, it will be helpful. This is in planning stage as of now. A group has been formed that will look into the modalities. It is at a conceptual stage. This will be backed by actual production,” Gupta said.
On the natural gas front, Gupta said ONGC is working on a plan to source about 5 MT of LNG annually. “That will be a combination of Henry Hub, crude-based LNG and from multiple sources. Volatility is a certainty going forward and sources will also increase in days ahead,” he added.
