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Indian state-owned Oil and Natural Gas Corporation Limited (ONGC), the biggest oil and gas explorer and producer in the country, plans to diversify in refining, petrochemicals, LNG trading, and renewable energy as it expects lower oil prices amid a looming crude supply glut.
“Globally, we are heading to a glut in oil supplies which means prices will reduce,” Arunangshu Sarkar, director for strategy at ONGC, told Bloomberg in an interview published on Tuesday.
“It will be difficult for a company like ONGC to survive in a low oil-price regime and the new businesses provide a hedge for such a scenario,” the executive added.
ONGC is already on the lookout to book LNG regasification capacity on India’s western coast and is discussing gas offtake deals with city distributors, Sarkar said.
A refinery is also in the plans for the state-run oil and gas explorer, the executive told Bloomberg, without giving details as the project is at a very early stage.
Reports emerged last year that ONGC is assessing plans for an $8.3-billion refinery plus petrochemicals project in the most populous Indian state to take advantage of growing fuel demand.
ONGC is considering situating the refinery project, expected to cost $8.3 billion (700 billion Indian rupees) in the state of Uttar Pradesh in northern India, sources with knowledge of the matter told Bloomberg in September.
ONGC has discussed with state-controlled refiner Bharat Petroleum Corporation Ltd (BPCL) the idea to build the refinery in Prayagraj, the most populous district in the state, the sources told Bloomberg.
Separately, ONGC plans to invest as much as $11.66 billion (1 trillion Indian rupees) in clean energy by 2030, a top ONGC executive told Bloomberg last month.
ONGC, the company producing about 70% of all of India’s oil and gas, plans to have a portfolio of renewable energy of 10 gigawatts (GW) by 2030, ONGC’s director of finance, Vivek Chandrakant Tongaonkar, told Bloomberg.
