Addressing a news conference after the companys 10th AGM here on Monday, Subir Raha, chairman and managing director, ONGC, said that as gainst the planned target of investing Rs 46,000 crore, the corporation is likely to invest more than Rs 80,000 crore.
Alongside, ONGC and BPCL have entered into an exclusive agreement under which ONGC will take BPCL along in bidding for high prospective oil and gas exploration blocks in exchange of the countrys second largest oil firm offering ONGC downstream opportunities.
BPCL is offering to us sustained incremental (petroleum product) production to sustain our proposed petrol station chain, Mr Raha told reporters.
This is part of collaboration agreement between ONGC and BPCL, offering each other areas for vertical integration. ONGC will give first priority to BPCL in bidding for oil and gas blocks and BPCL will open doors (for us) in refining and marketing, he said.
While Mr Raha said that presently the collaboration was restricted to BPCL providing fuels for ONGCs proposed petrol pump chain and the two firms bidding together for oil and acreage, company sources said the collaboration would extend to ONGC taking stake in bina refinery.
Mr Raha said that ONGC has also approched the government seeking permission to sell more than 70 million shares of IOC and 40 million shares of gail in the market with an object to meet its likely shortfall in the funding because of higher outlay for subsequent years. The market value of both companies shares is around Rs 4,000 crore at the current prices.
However, senior company officials said that in the event the government granted permission to sell shares, ONGC might sell only gail shares in the market.
The upstream firm, which produces just over 25 million tonne of crude annually, has already acquired 9.69 million tonne from Mangalore Refinery and Petrochemicals Ltd (MRPL) and is setting up a chain of 610 petrol stations in four states as part of its vertical integration exercise.
BPCL, which owns refineries in Mumbai and is majority stakeholder in Kochi and Numaligarh Refinery besides operating over 4,800 petrol stations, too is looking for entering upstream oil and gas exploration.
ONGC also proposes to double its oil production to at least 40 million tonne in the next 20 years through equity oil. We want to have 20-30 million tonne of equity oil in the next 20 years, Mr Raha said.
Over the next five years, ONGC has planned a target of procuring at least 10 million tonne of equity oil, he added. Mr Raha announced that the ONGC will commence commercial operation in nagaland soon, after a gap of 10 years.