MIRA
INFORM REPORT
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Report Date : |
12.05.2007 |
IDENTIFICATION DETAILS
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Name : |
OIL AND NATURAL GAS CORPORATION LIMITED |
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Registered Office : |
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Country : |
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Financials (as on) : |
31.03.2006 |
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Date of Incorporation : |
23.06.1993 |
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Com. Reg. No.: |
54155 |
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CIN No.: [Company
Identification No.] |
L74899DL1993GOI054155 |
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TAN No.: [Tax
Deduction & Collection Account No.] |
MUMO00241D |
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Legal Form : |
A public limited liability company. The company's shares are listed on
the Stock Exchanges. |
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Line of Business : |
Manufacturing of Crude Oil, Natural Gas, Liquefied etroleum Gas, Natural
Gasoline, Ethane / Propane, Aromatic Rich Naptha and Superior Kerosene Oil. |
RATING & COMMENTS
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MIRA’s Rating : |
A |
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RATING |
STATUS |
PROPOSED CREDIT LINE |
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56-70 |
A |
Financial & operational base are regarded healthy. General
unfavourable factors will not cause fatal effect. Satisfactory capability for
payment of interest and principal sums |
Fairly Large |
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Maximum Credit Limit : |
USD 2100000000 |
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Status : |
Good |
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Payment Behaviour : |
Regular |
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Litigation : |
Clear |
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Comments : |
Subject is a well established and reputed having fine track. The
company is progressing well. Directors are reported as experienced and respectable
businessmen. Trade relations are reported as fair. Business is active.
Payments are usually correct and as per commitments. Fundamentals are strong and healthy. The company can be considered normal for business dealings at usual
trade terms and conditions. The company can be regarded as a promising business partner in a
medium to long-run. |
LOCATIONS
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Registered Office : |
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Tel. No.: |
91-11-23721756/23310156-58/23301000 |
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Fax No.: |
91-11-23316413 |
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E-Mail : |
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Website : |
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Corporate Office : |
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Tel. No.: |
91-135-2757121 |
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Fax No.: |
91-135-2755298 |
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Factory 1 : |
Hazira and Uran |
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Regional Offices : |
Located at : |
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Head Quarters : |
Dehradun, Uttar Pradesh |
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Institutes
: |
Mumbai, Goa, Dehradun and |
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Branches : |
Located at :- v
701 Vasundhara Area, Ali Yavarjung Marg, Bandra
(East), Mumbai – 400 051,
Tel. No. 91-22-26451827 / 26513924 / 23513925 / 26429901 / 26429983 v
Nirmal, 7th Floor, Nariman Point,
Mumbai, v
5/A, Vasudhara Bhavan, Bandra (East), Mumbai –
400 051, v
Ankleshwar – 393010, v
No. 8, |
DIRECTORS
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Name : |
Mr.
R.S. Sharma |
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Designation : |
Chairman & Managing Director (from 25.05.2006) / Director
(Finance) |
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Date of Birth/Age : |
01.02.1951 |
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Date of Appointment : |
01.03.2002 |
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Qualification : |
CAIIB, FICWA & Advance Financia Management Program in Oil and Gas
from |
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Experience in Specific Functional Areas : |
Currently holding the position of Chairman & Managing Director
(from 25.05.2006)/Director (Finance); Enriched and diverse experience of more
than 30 years in finance, accounts, insurance and banking. |
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Directorship held in other Public companies : |
Indian Oil Corporation Limited Mangalore Refinery and Petrochemicals Limited ONGC Videsh Limited ONGC Tripura Power Co. Private Limited Mangalore SEZ Limited Kakinada SEZ Private Limited Petrochemicals Private Limited ONGC Mittal Energy Services Limited ONGC Mittal Energy Limited Mangalam Retail Services Limited |
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Chairmanship /Membership of Committees across all
Public companies : |
ONGC Member • Business Development • Financial Management Health, Safety & Environment • Human Resource Management Project Appraisal Remuneration • Shareholders'/ Investors' Grievance • Share Transfer ONGC Videsh Limited Member Audit |
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Name : |
Mr.
Subir Raha |
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Designation : |
Chairman & Managing Director (upto 24.05.2006) |
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Name : |
Dr. A.K. Balyan |
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Designation : |
Director (Human Resource) |
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Date of Birth/Age : |
2nd July, 1951 |
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Date of Appointment : |
23rd August, 2003 |
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Qualification : |
Decorate Degree in Chemistry from Technische Hochshule fur Chemie, |
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Experience in Specific Functional Areas : |
Holding position of Director (HR) and in-charge of Business
Development & Joint-ventures; Multifarious and enriched experience of
over 3 decades in various disciplines including Analytical Geo-Chernistry
Lab, Mud Engineering, Planning, Exploration and Project Management. |
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Directorship held in other Public companies : |
ONGC Videsh Limited Mangalore Refinery and Petrochemicals Limited Dahej SEZ Limited Mangalore SEZ Limited ONGC Tripura Power Co. Private Limited |
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Chairmanship /Membership of Committees across all
Public companies : |
ONGC Member Business Development Human Resource Management • Health, Safety & Environment • Project Appraisal • Remuneration Shareholders'/Investors' Grievance • Share Transfer |
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Name : |
Mr.
N.K. Mitra |
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Designation : |
Director (Offshore) |
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Name : |
Mr.
A.K. Hazarika |
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Designation : |
Director (Onshore) |
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Name : |
Mr.
O.K. Pande |
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Designation : |
Director (Exploratron) (from 23.09.2005) |
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Name : |
Mr.
Y.B. Sinha |
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Designation : |
Director (Exploration) (upto 04.05.2005) |
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Name : |
Mr.
U.N. Bose |
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Designation : |
Director (Technology & Field Services) (from 27.09.2005) |
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Date of Birth/Age : |
07.11.1952 |
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Date of Appointment : |
27.09.2005 |
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Qualification : |
Bachelor Degree in Mechanical Engineering. |
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Experience in Specific Functional Areas : |
Currently holding the position of Director (T&FS) and has to his
credit, experience of about 30 years in various fields including deviation/ horizontal
drilling, implemented drilling programmes in high pressure/high dip and
technology solutions to resolve difficult area drilling problems; initiated
deep water drilling campaign in deep and ultra-deep areas; contributed
technical papers and developed high -end training facilities for rig
supervisors. |
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Directorship held in other Public companies : |
Engineers India Limited ONGC Videsh Limited |
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Chairmanship /Membership of Committees across all
Public companies : |
ONGC Member • Business Development • Health, Safety & Environment Project Appraisal • Human Resource Management |
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Name : |
Mr.
Nathu Lai |
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Designation : |
Director (Technology & Field Services) (upto 30.04.2005) |
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Name : |
Mr.
Anil Razdan |
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Designation : |
Director (from 20.02.2006) |
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Name : |
Mr.
M.S. Srinivasan |
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Designation : |
Director (from 5.12.2005 to 02.01.2006) |
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Name : |
Mr.
Ashok Chawla |
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Designation : |
Director (from 05.12.2005) |
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Date of Birth/Age : |
08.01.1951 |
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Date of Appointment : |
05.12.2005 |
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Qualification : |
IAS, Post Graduate in English Literature and Economics; Diploma
(Micro-level Planning). |
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Experience in Specific Functional Areas : |
Currently holding the position of Addl. Secretary, Deptt. of Economic
Affairs, Ministry of Finance; concurrently Chairman & Managing Director,
Security Printing & Minting Corporation of India Limited Served with
distinction both in Central and State Governments. Important assignments
include Collector of Ahmedabad and Baroda Districts, Addl. Controller of
Capital Issues; Economic Counsellor, Indian Embassy, |
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Directorship held in other Public companies : |
Security Printing & Minting Corporation of India Limited • Member, Insurance Regulatory and Development Authority. |
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Chairmanship /Membership of Committees across all
Public companies : |
ONGC Member • Audit & Ethics • Business Development • Financial Management • Project Appraisal |
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Name : |
Mr.
RK. Deb |
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Designation : |
Director (upto 05.12.2005) |
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Name : |
Mr.
Sunjoy Joshi |
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Designation : |
Director (upto 05.12.2005) |
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Name : |
Mr.
RK. Sinha |
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Designation : |
Director (upto 03.03.2006) |
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Name : |
Mr.
M.M. Chitale |
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Designation : |
Director |
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Name : |
Mr.
Rajesh V. Shah |
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Designation : |
Director |
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Name : |
Mr.
U. Sundararajan |
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Designation : |
Director |
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Date of Birth : |
14th June, 1942 |
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Date of
Appointment : |
11th September, 2003 |
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Qualification : |
FICWA |
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Other
Directorship : |
Ø Thirumalai
Chemicals Limited Ø Cochin Shipyard
Limited |
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Name : |
Mr. A.M.
Uplenchwar |
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Designation : |
(from 23.12.2005) |
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Name : |
Mr.
N.K. Nayyar |
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Designation : |
Director (upto 05.12.2005) |
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Name : |
Dr. R.K. Pachauri |
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Designation : |
Director (from 26.06.2006) |
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Name : |
Mr.
V.R Singh |
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Designation : |
Director (from 26.06.2006) |
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Name : |
Mr.
RK. Choudhury |
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Designation : |
Director (from 26.06.2006) |
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Name : |
Dr. Bakul H. Dholakia |
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Designation : |
Director (from 26.06.2006) |
KEY EXECUTIVES
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Name : |
Mr. S. C. Setia |
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Designation : |
Company Secretary |
MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN
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Names of Shareholders |
No. of Shares |
Percentage of Holding |
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President of |
1057160451 |
74.14 % |
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Banks, Financial
Institutions and Insurance Companies |
34671585 |
2.43 % |
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Foreign
Institutional Investors |
120295921 |
8.43 % |
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Mutual Funds
& UTI |
9805173 |
0.69 % |
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NRIs & OCBs |
943565 |
0.07 % |
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Bodies
Corporate: |
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- Government |
171334226 |
12.01 % |
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- Others |
4572009 |
0.32 % |
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Public |
27251062 |
1.91 % |
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TOTAL |
1425933992 |
100.00
% |
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President of |
1057160451 |
74.14 % |
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Indian Oil
Corporation |
109653905 |
7.69 % |
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GAIL ( |
34266845 |
2.40 % |
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Life Insurance
Corporation of |
27080268 |
1.90 % |
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Euro Pacific
Growth Fund |
13502527 |
0.95 % |
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Capital World
Growth & Income Fund. Inc. |
7555840 |
0.53 % |
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HSBC Global Investment
Funds A/C. HSBC Global Investment Funds |
7457164 |
0.52 % |
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Morgan Stanley
& Co. International Limited A/C-Morgan Stanley Dean Witter Mauritius
Company Limited |
4621752 |
0.32 % |
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Aberdeen Asset Mangers
Limited A/C-Aberdeen International |
3444000 |
0.24 % |
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Franklin
Templeton Investment Funds |
3314586 |
0.23 % |
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TOTAL |
1268057338 |
88.92 % |
BUSINESS DETAILS
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Line of Business : |
Manufacturing of Crude Oil, Natural Gas, Liquefied etroleum Gas,
Natural Gasoline, Ethane / Propane, Aromatic Rich Naptha and Superior
Kerosene Oil. |
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Products : |
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PRODUCTION STATUS
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Particulars |
Unit |
Installed
Capacity |
Actual
Production |
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Crude Oil |
MT |
NA |
26189601 |
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Natural Gas |
000M3 |
NA |
24967985 |
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Liquefied Petroleum Gas |
MT |
1158000 |
1094307 |
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Natural Gasoline/Naptha |
MT |
2127000 |
357485 |
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Ethane/Propane |
MT |
570000 |
535089 |
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Aromatic Rich Naptha |
MT |
1072030 |
1199428 |
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Superior Kerosene Oil |
MT |
297200 |
177756 |
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Heavy Cut |
MT |
32965 |
10 |
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LSHS |
MT |
19800 |
25096 |
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HSD |
MT |
12540 |
36291 |
GENERAL INFORMATION
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No. of Employees : |
39352 |
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Bankers : |
State Bank of |
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Banking
Relations : |
Satisfactory |
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Auditors : |
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Name : |
K. K. Soni & Company Chartered Accountants S. Bhandari & Company Chartered Accountants Brahmayya & Company Chartered Accountants Lodha & Company Chartered Accountants S.C. Ajmera & Company Chartered Accountants |
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Associates : |
·
Petronet LNG Limited ·
ONGIO International Private Limited ·
Petronet MHB Limited |
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Subsidiaries : |
·
ONGC Videsh Limited (OVL) ·
Mangalore Refinery & Petrochemicals Limited (MRPL) ·
ONGC Nile ·
ONGC Narmada Limited
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CAPITAL STRUCTURE
Authorised Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
15,000,000,000 |
Equity Shares |
Rs.10/- each |
Rs.150,000.000
millions |
Issued, Subscribed & Paid-up Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
1,425,933,992 |
Equity Shares |
Rs.10/- each |
Rs.14,259.340
millions |
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Less : |
Calls in Arrears |
|
Rs. 0.040
millions |
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GRAND TOTAL |
|
Rs.14,259.230 millions |
FINANCIAL DATA
[all figures are
in Rupees Millions]
ABRIDGED BALANCE
SHEET
|
SOURCES OF FUNDS |
31.03.2006 |
31.03.2005 |
31.03.2004 |
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SHAREHOLDERS FUNDS |
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1] Share Capital |
14259.300 |
14259.280 |
14259.270 |
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2] Share Application Money |
0.000 |
0.000 |
0.000 |
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3] Reserves & Surplus |
525337.390 |
454194.870 |
391171.660 |
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4] (Accumulated Losses) |
0.000 |
0.000 |
0.000 |
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NETWORTH |
539596.690 |
468454.150 |
405430.930 |
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LOAN FUNDS |
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1] Secured Loans |
0.000 |
0.000 |
0.000 |
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2] Unsecured Loans |
1069.760 |
18221.550 |
33785.910 |
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TOTAL BORROWING |
1069.760 |
18221.550 |
33785.910 |
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DEFERRED TAX LIABILITIES |
63551.330 |
54438.460 |
58420.170 |
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Liability for Abandonment Cost |
126156.350 |
80940.640 |
80292.030 |
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TOTAL |
730374.130 |
622054.800 |
577929.040 |
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APPLICATION OF FUNDS |
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FIXED ASSETS [Net Block] |
78421.970 |
58365.310 |
56684.620 |
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Capital work-in-progress |
28303.010 |
43186.680 |
9825.610 |
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Producing Properties [Net] |
275833.370 |
229606.630 |
230803.820 |
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Exploratory Wells In Progress |
29602.830 |
17357.870 |
11220.440 |
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INVESTMENT |
48885.730 |
40366.660 |
44216.660 |
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CURRENT ASSETS, LOANS & ADVANCES |
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|
Interest Accrued |
3509.480
|
4357.270 |
0.000 |
|
|
Inventories |
30384.940
|
23924.190 |
24056.890 |
|
|
Sundry Debtors |
37042.760
|
37293.070 |
23177.990 |
|
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Cash & Bank Balances |
42792.650
|
58488.060 |
55734.480 |
|
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Other Current Assets |
45335.770
|
36190.660 |
37102.980 |
|
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Loans & Advances |
212549.330
|
159637.380 |
140542.200 |
|
Total
Current Assets |
371614.930
|
319890.630 |
280614.540 |
|
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Less : CURRENT
LIABILITIES & PROVISIONS |
|
|
|
|
|
|
Current Liabilities |
65270.110
|
51904.170 |
35740.640 |
|
|
Provisions |
40680.950
|
40126.440 |
25102.800 |
|
Total
Current Liabilities |
105951.060
|
92030.610 |
60843.440 |
|
|
Net Current Assets |
265663.870
|
227860.020 |
219771.100 |
|
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|
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|
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MISCELLANEOUS EXPENSES |
3663.350 |
5311.630 |
5406.790 |
|
|
|
|
|
|
|
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TOTAL |
730374.130 |
622054.800 |
577929.040 |
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PROFIT & LOSS
ACCOUNT
|
PARTICULARS |
31.03.2006 |
31.03.2005 |
31.03.2004 |
|
|
Sales Turnover |
479663.930 |
463620.450 |
335973.220 |
|
|
Other Income |
23484.980 |
17251.470 |
|
|
|
Total Income |
503148.910 |
480871.920 |
335973.220 |
|
|
|
|
|
|
|
|
Profit/(Loss) Before Tax |
218371.220 |
196655.450 |
136384.060 |
|
|
Provision for Taxation |
74063.440 |
66824.990 |
49739.770 |
|
|
Profit/(Loss) After Tax |
144307.780 |
129830.460 |
86644.290 |
|
|
|
|
|
|
|
|
Earnings in Foreign Currency : |
|
|
|
|
|
|
Export Earnings |
19.620 |
39.170 |
3725.990 |
|
|
Services |
45398.510 |
33548.970 |
3.380 |
|
|
Other Earnings |
3063.660 |
6216.400 |
14.770 |
|
Total Earnings |
48481.790 |
39804.540 |
3744.140 |
|
|
|
|
|
|
|
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Imports : |
|
|
|
|
|
|
Raw Materials |
25371.540 |
28148.300 |
3171.380 |
|
|
Stores & Spares |
4760.990 |
3301.910 |
3605.360 |
|
Total Imports |
30132.530 |
31450.210 |
6776.740 |
|
|
|
|
|
|
|
|
Expenditures : |
|
|
|
|
|
|
Purchase |
34337.970 |
51013.160 |
0.000 |
|
|
Production, Transportation, Selling & Distribution
Expenditures
|
170245.590 |
168428.250 |
142159.150 |
|
|
Recouped Costs
|
83021.720 |
62014.230 |
55608.640 |
|
|
Interest & Exchange Fluctuation
|
298.140 |
409.630 |
479.640 |
|
|
Provisions & Write-Offs (Net)
|
3437.650 |
2828.250 |
1341.730 |
|
Total Expenditure |
291341.070 |
284693.520 |
199589.160 |
|
QUARTERLY RESULTS
|
PARTICULARS |
30.06.2006 |
30.09.2006 |
31.12.2006 |
|
Type |
1st
Qtr |
2nd
Qtr |
3rd
Qtr |
|
Sales
Turnover |
146027.700 |
140685.500 |
155645.200 |
|
Other
Income |
4199.500 |
9397.100 |
7044.900 |
|
Total
Income |
150227.200 |
150082.600 |
16269.0.100 |
|
Total
Expenditure |
64933.400 |
70287.300 |
66552.500 |
|
Operating
Profit |
85293.800 |
79795.300 |
96137.600 |
|
Interest |
32.800 |
41.000 |
76.700 |
|
Gross
Profit |
85261.000 |
79754.300 |
96060.900 |
|
Depreciation |
22308.600 |
18472.600 |
25575.900 |
|
Tax |
24104.700 |
21254.400 |
24861.000 |
|
Reported
PAT |
41189.900 |
41739.800 |
46683.100 |
200606 Quarter 1 –
Expenditure Includes (Increase)/Decrease in stock in Trade Rs
248.40 million Purchases Rs 16721.70 million Consumption of Raw Material Rs
771.20 million Staff Expenditure Rs 2974.50 million Statutory levies Rs
31140.00 million Other expenditure Rs 13077.60 million Tax Includes Provision
for Current Tax Rs 24008.00 million Deferred Tax (Asset) Rs (2342.20) million
Fringe Benefit Tax Rs 96.70 million Consumption of Raw Materials represents
consumption of raw material, stores & spares Depreciation also includes
depletion, amortisation and impairment loss EPS is Basic & Diluted Status
of Investor Complaints for the quarter ended June 30, 2006 Complaints Pending
at the beginning of the quarter 02 Complaints Received during the quarter 365
Complaints disposed off during the quarter 360 Complaints unresolved at the end
of the quarter 07 1. The audited accounts for the year ended March 31, 2006 are
under review by the Comptroller and Auditor General of
200609 Quarter 2 –
Expenditure Includes (Increase)/Decrease in stock in Trade
Rs 253.30 million Purchases Rs 16348.40 million Consumption of Raw Material Rs 645.20
million Staff Expenditure Rs 6274.30 million Statutory levies Rs 29816.20
million Other expenditure Rs 16949.90 million Tax Includes Provision for
Current Tax Rs 21158.00 million Deferred Tax (Asset) Rs (1712.50) million
Fringe Benefit Tax Rs 96.40 million Consumption of Raw Materials represents
consumption of raw material, stores & spares Depreciation also includes
depletion, amortisation and impairment loss EPS is Basic & Diluted Status
of Investor Complaints for the quarter ended September 30, 2006 Complaints
Pending at the beginning of the quarter 07 Complaints Received during the
quarter 17 Complaints disposed off during the quarter 24 Complaints unresolved
at the end of the quarter Nil Note :- These exclude investor complaints
regarding the offer for sale upto 10% of equity shares of the company made by
the Government of India in March 2004, which are being attended to by the
Registrar to the issue appointed by Govt. of India. 1. In terms of the decision
of the GOI, the company has shared under recoveries of Oil Marketing Companies
(OMCs) for the 2nd quarter of 2006-07 by allowing discount in the prices of
Crude Oil, PDS kerosene and domestic LPG based on the provisional rates of
discount communicated by Petroleum Planning and Analysis Cell (PPAC). The
impact on this account is as under for the Quarter Ended September 30, 2006:
Decrease in: Gross Discount - Rs 50320.00 million Decrease in Sales Revenue -
Rs 48268.20 million Decrease in Profit before tax - Rs 45602.90 million 2.
Gross sales and purchases for the quarter include Rs 16362.90 million (previous
quarter Rs 12156.90 million) and Rs 16348.30 million (previous quarter Rs
12143.80 million) respectively on account of trading of MRPL products, a
subsidiary of ONGC. Similarly, gross sales and purchases for the half year
include Rs. 33097.00 million (previous half year Rs 21520.20 million) and Rs.
33070.10 million (previous half year 2150.02 Crore) respectively. 3. The
Institute of Chartered Accountants of
200612 Quarter 3 –
Expenditure Includes (Increase)/Decrease in stock in Trade
Rs (513.80) million Purchases (Trading) Rs 13788.40 million Consumption of Raw
Material Rs 1617.50 million Staff Expenditure Rs 5020.40 million Statutory
levies Rs 30582.20 million Other expenditure Rs 16057.80 million Tax Includes
Provision for Current Tax Rs 24650.00 million Deferred Tax (Asset) Rs (1059.10)
million Fringe Benefit Tax Rs 211.00 million Consumption of Raw Materials
represents consumption of raw material, stores & spares Depreciation also
includes depletion, amortisation and impairment loss EPS is Basic & Diluted
Status of Investor Complaints for the quarter ended December 31, 2006
Complaints Pending at the beginning of the quarter Nil Complaints Received
during the quarter 10 Complaints disposed off during the quarter 09 Complaints
unresolved at the end of the quarter 01 1. In terms of the decision of the GOI,
the company has shared under recoveries of Oil Marketing Companies (OMCs) for
the 3rd quarter 2006-07 by allowing discount in the prices of Crude Oil, PDS
kerosene and domestic LPG based On the provisional rates of discount communicated
by Petroleum Planning and Analysis Cell (PPAC). The impact on this account is
as under:. For the Quarter ended December 31, 2006 Gross Discount - Rs 22040.00
million Decrease in Sales Revenue - Rs 21253.90 million Decrease in Profit
Before Tax - Rs 20302.80 million 2. Gross sales for the quarter and nine months
include Rs 13811.80 million (previous quarter Rs 5279.60 million) and Rs
46908.80 million (previous nine months Rs 26799.80 million) respectively on
towards trading of products of MRPL, a subsidiary of ONGC. 3. In accordance
with the ICAI Guidance note on VAT accounting, the sales turnover is net of VAT
of Rs. 6714.40 million and Rs 19414.60 million during current quarter and nine
months respectively whereas sales turnover of corresponding periods of previous
year are inclusive of VAT. 4. Staff expenditure during the quarter and nine
months includes Rs 2250.00 million on account of proposed contribution to post
Retirement benefit Scheme. The expenditure during the nine months also includes
Rs 3030 million towards Golden Jubilee and additional annual incentive. 5. ONGC
has been representing for higher price towards richer fraction of APM gas being
supplied t0 GAIL. In pursuant thereto, as per the decision of MoPNG, the
surplus in gas pool account amounting to Rs 9080 million (including interest of
Rs 190 million) lying with GAIL has been transferred to ONGC, subject to ONGC
giving an undertaking that in case Governmen decides otherwise the amount would
be refunded. In view of the uncertainty involved, the amount has been kept
under Other Deposit Liability. 6. The Institute of Chartered Accountants of
KEY RATIOS
|
PARTICULARS |
31.03.2006 |
31.03.2005 |
31.03.2004 |
|
Debt-Equity
Ratio |
0.22 |
0.24 |
0.16 |
|
Long
Term Debt-Equity Ratio |
0.22 |
0.22 |
0.13 |
|
Current
Ratio |
1.44 |
1.45 |
1.34 |
|
TURNOVER
RATIOS |
|
|
|
|
Fixed
Assets |
1.06 |
1.11 |
0.81 |
|
Inventory |
17.77 |
19.47 |
16.36 |
|
Debtors |
12.98 |
15.45 |
10.40 |
|
Interest
Cover Ratio |
465.95 |
525.37 |
296.43 |
|
Operating
Profit Margin(%) |
50.28 |
43.34 |
43.84 |
|
Profit
Before Interest And Tax Margin(%) |
45.35 |
42.18 |
41.98 |
|
Cash
Profit Margin(%) |
34.84 |
28.96 |
28.50 |
|
Adjusted
Net Profit Margin(%) |
29.91 |
27.79 |
26.64 |
|
Return
On Capital Employed(%) |
35.71 |
36.61 |
31.09 |
|
Return
On Net Worth(%) |
28.63 |
29.71 |
22.72 |
STOCK PRICES
|
Face Value |
Rs.10.00/- |
|
High |
Rs.897.00/- |
|
Low |
Rs.869.00/- |
LOCAL AGENCY FURTHER INFORMATION
The company's fixed assets of important value includes Freehold &
Leasehold Land, Buildings & Bunk Houses, Railway Slidings, Plant &
Machinery, Furniture & Fittings, Vehicles, Survey Ships, Crew Boats,
Aircrafts and Helicopters.
HISTORY
Oil and Natural Gas Corporation (ONGC) was set up in 1956
with significant contribution in industrial and economic growth of the country,
is a leading National Oil Company of
It is
During March, 1999, ONGC, Indian Oil Corporation (IOC) a downstream giantand
Gas Authority of India Limited (GAIL) the only gas marketing company, agreed to
have cross holding in each other's stock to pave the way for Long-term
strategic alliance amongst themselves, both for the domestic and overseas
business opportunities, in the energy value chain. During 2001-02 the augment
recovery from Onshore fields of 13 projects 2 were commissioned. The Sakhalin-I
project in
During 2002-03 the company has acquired the entire 37.39% stake which was held
by the Indian Rayon and Industries Limited In the context of acquisition,
Greater Nile Oil Project, the subsidiary OVL Limited was sold to Oil India
LIMITED on 10th March 2003 at par value.
In March 2004, the government of
ONGC is pursuing a strategy of downstream integration to diversify its revenues
and establish presence in higher-margin segments. Through MRPL, it has a major
presence in oil refining (capacity: 9.69 million TPA - 8% of total refining
capacity in
On a long-term basis, ONGC has drawn out a four pronged strategy for the next
twenty years. This includes-1. Doubling reserves from 5.77 billion metric tonne
(bln Mt) oil plus oil equivalent gas (O+OEG) to 12 bln Mt in the next 20
years.
Improving average recovery factor to 40% from 28% currently. Notably, while
some of the wells have a recovery factor of over 30%, some have a recovery
factor of less than 10% also.
Souring 20 mln Mt pa Oil/Oil-equivalent Gas from Equity Assets abroad.
Sustainable growth as a Global Integrated Energy Provider.
During 2005 ONGC completed Phase-I of a collaborative project on CBM in Jharia
Field which was initiated in May 2004. The company has signed a joint industry
program with M/s
In March 2005 ONGC launched its retail marketing business with commissioning of
the 1st autofuels outlet at Mangalore under the 'ONGC Values' brand coupled
with the brand 'Shopp'njoy' for the non-fuel Business. The company has also
received approval/license from the Government for marketing of non-subsidised
LPG cooking gas, Kerosene and Aviation refueling sales.
A joint venture project with Petronet LNG Limited to enhance capacity of the
Dahej terminal from 5 to 10 MMTPA and also set up another terminal at Kochi of
2.5 MMTPA Capacity was commenced on 1st April 2004. The company holds 12.5%
equity stake in Petronet LNG Limited The company is holding 23% equity stake in
Petronet MHB Limited(Joint venture project) for the product pipeline company
linking MRPL to
During 2005 the company has entered into various alliances in form of execution
of Memorandum of Understanding with Kakinada Seaport & IL&FS with 26%
equity stake for development of Port based SEZ at Kakinada, AndhraPradesh: with
Karnataka State Government for developing a Coastal Special Economic Zone at
Mangalore: with Mittal Investments Sarl(Mittal Group) for cooperation in
trading and shipping of oil and gas (including LNG) sourced through the MoU
between OVL and Mittal Investments Sarl and related consequential business
opportunites.
During 2004-05 the company discovered its third deep-water exploration campaign
'Sagar Samriddhi' in Krishna-Godavari (KG) Basin at the location Vashistha
(VA-1A) in block KG-OS-DW-IV. In the western offshore a shallow-water oil and
gas was recorded in D-33, about 60 Kilometers South-West of Mumbai High,
Onshore, Oil and Gas was found in Tiphuk-1 in North Assam Shelf and Oil was
struck at Wamaj in
The company 's subsidiary unit ONGC Videsh Limited will commence the commercial
production of gas by the end of current financial year(2001-02). Internationally,
its wholly owned subsidiary ONGC Videsh Limited has a number of existing and
upcoming interests in selected oil patches including development of a large gas
field discovered by it in
During 2006 the company was awarded 60 out of 110 exploration blocks by the
Government in the five NELP rounds. Out of these 60 NELP Blocks 35 are in The
form of unincorporated joint ventures and remaining blocks the company has 100%
participating interest.
The company has issue bonus shares as a 'Golden Jubilee year Memorabilia' in
the ratio of 1:2.
The company has taken structured initiatives towards new energy sources, i.e.
Coal Bed Methane(CBM), under Ground Coal Gasification (UCG) and surface Coal
Gasificiation (SCG). The company has intensified CBM Exploration and expects to
produce CBM from early 2007. The company has entered into Memorandum of
Agreement (MoA) with Central Mining Research Institute, Dhanbad to carry out
laboratory and field-based studies for CBM exploration and exploitation. The
company has chosen the location for pilot project for UCG at Vastan,
The company has firmed up two state-of-the-art petrochemical complexes one at
Dahej (
The company is developing a 740 MW Power Plant at Palatana in Tripura Primarily
to monetize idle gas. The project is scheduled to be completed by 2008. The
company is also taking initiatives to develop non-conventional energy sources
and has planned to set up two Wind Power Projects of 50 MW each at
The Company, 'India's most Valuable Corporate' tested a new
peak of Two Trillion Rupees in terms of Market Capitalization in May, 2006 The
Company also continues to maintain the unique distinction of having the highest
Net Worth and the highest Net Profit, inspite of allowing discounts to the tune
of Rs 119,565 million to PSU Oil Marketing Companies, in crude oil and product
prices, as per administrative orders by the Ministry of Petroleum & Natural
Gas, Government of India. The Company remains the undisputed leader in
The Company has been awarded the highest-ever Credit Rating for any Indian
Corporate by the International Credit Rating Agency, Moody's Investors
Services. The rating awarded to the Company is Baa1 (Indicative Foreign Currency
debt rating) 2 notches higher than Sovereign rating / A2 (Local Currency issuer
rating) 6 notches higher than Sovereign rating, with 'stable' outlook. CRISIL
and ICRA have also assigned the Company the highest domestic credit ratings of
AAA and LAAA, respectively with a 'stable' outlook.
The Company retains its numero uno ranking among all Indian Companies in the
prestigious Forbes Global 2000 list of world's mega corporations (based on
composite evaluation of sales, profits, assets and market value). You will be
surely happy to know that the Company has now improved its position in Forbes
Global 2000 to 256th ranking from 265th in the previous year.
Highlights
* The Company has been ranked 158th among the world's largest companies,
in terms of Market Capitalization, in 10th annual Financial Times, Global 500
listing (June 2006).
* The Company has been ranked 3rd amongst the 50 Best Asian companies and
it topped the list of six Indian companies in Business Weeks first annual
ranking of Asia's 50 best-performing listed Companies drawn from a list of 625
Asian corporates (October 2005).
* The Company in terms of revenue scaled up to 402nd rank in Fortune
Global 500 list from 454th rank in the previous list. In terms of Profit, the
Company is ranked 115th, leading all Indian Corporates (July 2006).
* The Company was ranked 26th in the Platts Top 250 Global Energy
Companies Ranking, 2006 based on the five metrics of Asset, Revenue, Profit,
Earning Per Share and Return on Invested Capital (ROTC) (March 2006).
* The Company bagged the prestigious NDTV Profit Business Leadership
Award, in the oil and gas category. The Hon'ble Prime Minister, Dr. Manmohan
Singh, gave away the Award which was received by the C&MD on 28th July,
2006.
In
* Biggest Wealth Creator amongst all listed companies on Indian
bourses
* Introduced Integrity Pact to institutionalise Transparency in public
procurement practices.
* Excellence in Promotion of Sports in PSU category
* Trend Setter in PSU for Clean Development Mechanism (CDM) project in
line with United Nations Framework Convention on Climate Change
* Excellence in Corporate Social Responsibility
* Excellence in Safety & Environment Management
* Excellence in Corporate Governance
During the year, the Company discovered Ten new finds of
Hydrocarbons-5 in Deepwater, 3 in Shallow Water and 2 in Onshore areas. You
will be glad to note that the Company has taken initiatives for Shallow Gas
Exploration in Cambay and KG Basins and presence of commercially exploitable
shallow gas has been confirmed in Ankleshwar field.
In the previous five bidding rounds of NELP Blocks, the Company has been able
to secure 60 out of 110 blocks. Out of the secured 60 NELP Blocks, in 35 Blocks
the Company holds participating interest through Joint Ventures (JVs) and the
Company holds 100% participating interest in the remaining Blocks. In the Sixth
NELP round, Government has offered 55 blocks: 25 Onshore, 6 Shallow water and
24 Deepwater. As in the past, the company would like to be an aggressive
bidder.
Hazira Gas Processing Complex of the Company has witnessed unprecedented floods
and thus had to be put on planned shut-down from the midnight of August 07-08,
2006. On account of pro-active measures, timely action was taken for sequential
safe shut-down thus minimising the damages. Revival work is underway on war
footing to flow the gas at the quickest possible time, in order to minimise the
hardship on the HVJ gas pipeline consumers.
The Company's wholly-owned subsidiary, ONGC Videsh Limited (OVL), the biggest
Indian Multinational in terms of overseas investment recorded the following`
achievements:
* Highest-ever Production
* Highest-ever Turnover
* Highest-ever Profits
* Status of second largest E&P company in India (Second only to the
Company)
The Company's subsidiary, Mangalore Refinery & Petrochemicals Limited
(MRPL) registered commendable performance in operations, with the following
achievements:
* Highest-ever Crude Run* Highest-ever Capacity Utilization *
Highest-ever Turnover * Lowest-ever Energy Consumption
OIL & GAS RESERVES
As a measure of good governance, the Company has made voluntary disclosures in
respect of the Oil & Gas Reserves. Such voluntary disclosures conform to
the Reserves Categorisation procedure specified by the Society of Petroleum
Engineers (SPE classification 1994) and comply with US Financial Accounting
Standards Board (FASB) statement no. 69 for disclosure of annual estimates of
proven Oil & Gas reserves.
You will be pleased to know that the Company has added 68.37 Million Metric
Tonnes (MMT) of ultimate reserves of oil and oil equivalent gas (O+OEG) during
the year under review from its domestic & overseas assets (held by OVL).
The domestic accretion was 51.65 MMT including ONGC's share in JVs against
production of 51.16 MMT during 2005-06.
SUBSIDIARIES
(i) ONGC Videsh Limited (OVL)
ONGC Videsh Limited (OVL), the wholly owned subsidiary of the Company which is
engaged in overseas E&P activities made significant strides in 2005-06. The
Company secured equity participation in 9 Oil & Gas Assets in 7 countries
namely Block 81-1 in Libya, Block-2 in Nigeria, Block A-3 in Myanmar, Al Furat
Producing Blocks in Syria, Block BC-10 in Brazil, Block 127 & 128 in
Vietnam, Block 24,26,27,28,29 & 36 (including part of Block 35) and Block
34 & 35 in Cuba.
OVL participates in 22 E&P assets in 13 countries namely
Besides, OVL has recently won two highly prospective exploration Blocks in
oil-rich
OVL is currently producing oil and gas from its assets in
OVL's share in production of Oil and Oil equivalent gas (O+OEG), together with
its wholly-owned subsidiary ONGC Nile Ganga BY, increased to 6.339 MMT a rise
of 25%. OVL earned consolidated gross revenue of Rs. 81,707.28 million, up 36%
and its net profit was Rs. 9,011.96 million, up18%.
The Board of Directors of the Company has approved the subscription of 70
million additional equity shares of Rs. 100/- each of OVL at par, aggregating
to Rs. 7,000 million by opting to convert the loan extended by the Company into
equity.
(ii) Mangalore Refinery & Petrochemicals Limited (MRPL)
The Company continues to hold 71.62% equity stake in MRPL. MRPL has scaled a
new heights of excellence in its operational performance:
* Highest-ever Crude Throughput at 12.12 MMT ;
* Highest-ever Capacity Utilisation at 125%- The highest among all PSU
Refineries;
* Highest-ever Turnover of Rs.282,430 million ;
* Highest-ever Export sales of Rs. 119,170 million;
* Lowest Energy Consumption among all similar Indian Refineries;
* Highest-ever Accident Free Working days-951 days as on 18th July,
2006.
Inspite of the excellent operational performance, MRPL
earned a Net Profit of Rs.3,716 million against Rs.8,800 million in 2004-05,
because of sharing of under recoveries/subsidy burden on LPG (domestic), SKO
(PDS), MS and HSD, on the instructions of Ministry of Petroleum & Natural
Gas, Government of India, on account of unprecedented increase in the crude oil
prices. PSU Oil Marketing Companies (OMCs) have advised discounts of Rs.3,986
million as share of MRPL towards the above subsidy/ under recoveries. MRPL is
seeking more equitable approach with Government of India regarding the
mechanism of these discounts. Besides, the reduced lifting by the PSU
refineries for domestic market, leading to higher exports with lower margins,
has also adversely affected the financial performance of MRPL.
MRPL has started implementing a Refinery Up-gradation-cum-Expansion project
involving a capital outlay of Rs.79,430 million to (i) increase the refining
capacity to 15 MMTPA, (ii) increase the distillate yield by about 10% in lieu
of low value black oil pool, (iii) enhance capacity to process cheaper
high-sulphur & high TAN crude oils even while producing the transportation
fuels of Euro III / Euro IV standards and (iv) enable MRPL's entry into Lube
Oil Base Stock (LOBS) market with 250,000 tonnes per annum capacity. Engineers
India Limited (EIL) has been appointed Project Management Consultant (PMC) and
the project is scheduled to be completed in 48 months time (June, 2010).
In addition, an Aromatic complex is also being set up through a separate SPV of
ONGC/ MRPL at Mangalore SEZ with an estimated project cost of Rs.48,520 million
to bring value-addition to surplus naphtha by producing paraxylene.
The Board of Directors of MRPL has recommended a dividend of Rs. 0.7/- per
share (7%) for the year 2005-06.
JOINT VENTURES/ASSOCIATES
(i) Petronet LNG Limited (PLL) The Company has 12.5% equity stake in PLL.
During the year 2005-06, it has achieved the extraordinary dual distinction of
becoming a profit-making undertaking and recording an almost 100% operating
capacity (against 50% in 2004-05). During the year, the turnover is Rs.
38,371.7 million, profit before tax is Rs. 2,950.3 million and profit after tax
is Rs. 1,949.3 million, respectively.
(ii) ONGC Tripura Power Company Private Limited (OTPC) Incorporated as Joint
Venture with Tripura Power Development Corporation Limited(TPDC) and
Infrastructure Leasing & Financial Services (IL&FS). The objective is
that of monetisation of the Company's idling gas reserves by setting up a
gas-based power generating project in Tripura. OTPC is setting up 740 MW (2x370
MW) power generation plant in Tripura at an all inclusive cost of Rs.29,031
million.
The Company has also approved subscription of upto 150% equity in the
transmission project.
Further, the Company has decided to lend Rs 200 million as unsecured loan to
Tripura Power Development Corporation Limited (TPDC) for taking up project
development work and to allot land for the project at a nominal cost. A sum of
Rs.191.49 million has been paid to TPDC during the year.
(iii) Pawan Hans Helicopters Limited (PHHL)
The Company has 21.5% equity in PHHL, which provides helicopter services
primarily to the Company. PHHL earned a provisional net profit of Rs 370
million during 2005-06.
(iv) Petronet MHB Limited (PMHBL)
The Company holds 23% equity stake in this product pipeline company linking
MRPL to
(v) Dahej SEZ Limited (DSL)
The Company is the co-promoter of Dahej SEZ Limited (DSL) with 23% equity
participation. The Government of Gujarat through Gujarat Industrial Development
Corporation (GIDC) has a participative interest of 26%. The balance 51% equity
of the Company shall be with other Joint Venture partners. DSL has been incorporated
with the objective of developing a Special Economic Zone (SEZ) at Dahej,
(vi) Mangalore SEZ Limited (M-SEZ)
The Company along with Karnataka Industrial Area Development Board (KIADB),
representing Government of Karnataka, is the anchor co-promoter of Mangalore
SEZ Limited, which has been incorporated on 24th February, 2006. ONGC holds 23%
equity in this Special Purpose Vehicle (SPV) which has been established to
develop infrastructure for MRPL's project within the SEZ. The Kannara Chamber
of Commerce and Industry (KCCI) and Industrial Leasing & Financial Services
Limited (IL&FS) have entered into an MOU envisaging participation of 51% in
this SPV.
(vii) ONGC Mittal Energy Services Limited (OMESL)
The Company has formed a Joint Venture (JV) company with Mittal Investments
S.A.R.L. in the name of ONGC Mittal Energy Services Limited (OMESL) with the
objective to focus on trading and shipping of Oil and Gas, including LNG. In
this JV 98% of the equity shall be held by the Company and Mittal Investments
S.A.R.L. in the ratio of 51:49. The balance 2% shall be with financial
institutions.
10. OTHER BUSINESS INITIATIVES In pursuit of achieving organisational growth
with stability, the Company has been looking for new business growth options through
entering into various strategic alliances in the form of Memorandum of
Understanding (MoU) with companies having niche strength. Prominent amongst
these are:
(i) MoU with Shell Exploration B.V. to pursue joint business opportunities
globally in the entire hydrocarbon value-chain.
(ii) MoU with Enter Nazionale Idrocarburi (ENI), the 6th biggest integrated Oil
Major, a Fortune 500 company. The terms of the MoU extend beyond the confines
E&P covering midstream projects like LNG as well.
(iii) MoU with Norsk Hydro of Norway, one of the largest Offshore E&P
Company in the world, for co-operation in Deepwater Drilling, Field Development
and Reservoir Management.
(iv) MoU with the Institute of Petroleum Technology (IPT) of Norwegian
University of Science and Technology and the National Geophysical Research
Institute (NGRI), to pursue work on Reservoir Modeling for Enhanced Oil
Recovery.
(v) MoU was inked with another Norwegian firm Roxar Software Solutions, to
enable the Company to focus on Real-Time Model Updation of Reservoir using
Logging While Drilling (LWD), Geosteering information, integrated Log and
Drilling data.
(vi) MoU with Shipping Corporation of India (SCI) for forming of a
joint-venture SPV, for Offshore services and related business.
(vii) An Integrated Trading Desk (ITD) was established in 2003, as a platform
for coordinating transactions relating to sourcing of crude oil for MRPL and
export of products of ONGC group of companies namely, ONGC, ONGC Videsh, ONGC
B.V. and MRPL. The ITD is engaged in varied activities like the international
sale of crude oil from OVL's properties abroad; arranging MRPL's requirement of
crude oil; export of surplus refined petroleum products of MRPL and export of
surplus value-added petroleum products from ONGC's Hazira and Uran Plants. The
desk's performance during the year, in successfully handling import of crude
oil for MRPL under Term Contracts and the export of products/sale of crude
through tenders has been commendable.
The future plan of ITD includes interalia risk management, hedging, swapping,
shipping, charter hiring etc.
Super Unnati Prayas Scheme
The first Batch of 20 executives engaged in a customised, exclusive MBA
programme at the Indian Institute of Foreign Trade (IIFT) were conferred with
MBA degrees in International Business at the 40th IIFT convocation in
Another 20 executives, pursuing a consortium MBA programme at MDI Gurgaon;
successfully completed the course with excellent performance and were awarded
MBA degrees in March, 2006.
(iii) Shangsaptak
This unique, innovative and exclusive orientation programme for below-the-Board
executives is being conducted at the
The second batch of 31 executives completed their exposure to a world-class
curriculum with academic and industry exposure in October, 2005 and the course
for the third batch of 31 senior executives commenced in August, 2005.
(iv) Senior Management Programme
A Senior Management Programme (SMP) was introduced this year for executives at
middle level. A total of twenty six executives have undergone the programme
which comprises of classroom learning for 14 days at MDI Gurgaon and an
overseas learning component for the next 14 days including overseas training at
OPEC HQ, Vienna, Vienna Power Plant, Garbage recycling plant, Vienna, British
Petroleum Downstream hub-Austria, University of Antwerp, European School of
Management-Paris, Luxembourg Stock Exchange, etc.
(v) ONGC Academy As many as 3,848 executives attended 186 programmes at the
academy, excluding 351 fresh executives inducted as graduate trainees on their
induction course. The academy organised a total of 16 high intensity E&P
training programmes on emerging technologies with training conducted by
internationally renowned foreign faculty.
The Regional Training Institutes conducted 348 training programmes for 5,313
non-executives.
During the year under report, eighteen participants from Oil Exploration
Company (DEC),
(vi) ARCUBE
As reported in 2004-05, the Company has initiated a comprehensive study to
redefine the organization in order to achieve world class performance levels.
The Three Rs represent Roster, Roles and Responsibilities. From the findings of
this study, various HR initiatives have been identified and are under
implementation, that is;
* Competency Mapping in the core business areas of exploration.
* Rationalisation of Cadres and Disciplines in line with the global best
practices.
* Optimum manpower deployment in the operational areas like GGS, Rigs,
etc.
MANAGEMENT DISCUSSION ANTI ANALYSIS REPORT
A. Industry structure and developments
A.1 Since last Annual General Body Meeting of the Company in September' 2005
global landscape and dynamics for petroleum industry has changed
radically.
A.2 Oil prices crossed USD 75 per barrel. Natural gas prices also increased
world over. Hurricane Katrina's effect on production and refining capacity in
the Gulf of Mexico, ongoing conflicts in Middle East, surging demands from
world's two fastest growing nations India and China coupled with capacity
constrains of oil exporting countries are few reasons for sudden rise in oil
and gas prices.
A.3 Growing concern about energy security, geo-politics and unprecedented
interest of investors in energy business are also the factors to put energy at
premium. Continuous hardening of oil prices and other energy sources are now
being seen as the long-term response to 'demand shock'.
Oil and Gas Demand
Over the last decade primary energy consumption in the world increased at a
Compounded Annual Growth Rate (CAGR) of more than two percent, mainly due to
surge in energy demand from developing world, especially from China and India,
where it has spiraled at a CAGR of 5.4% and 4.3% respectively.
Oil and natural gas are the dominant fuels in energy basket, accounting for
almost 60% of the primary energy consumption with a share of 36% and 24%
respectively.
Oil consumption in the world increased at a CAGR of 1.7%; however,
Globally natural gas consumption increased at a CAGR of 2.5%. In case of
Hydrocarbon Resources
The greatest exploration successes occurred prior to 1980, driven by large
discoveries in
Industry has made significant new discoveries in the last few years but they
are increasingly being made at greater depths on land and in deepwater where
cost of finds and production are high. New and discovered resources need to be
produced economically and in environment friendly manner to meet ever growing
demand for oil and gas and offset natural field decline. Exploration successes
would also require new and better technology.
New supplies, especially gas, are located at increasing distances from
consuming markets. Finding economic and safe transportation solutions is yet
another challenge before the industry. However, good news is that transnational
trade of natural gas has increased substantially in recent past mainly due to
strengthening of gas supply from countries like,
B. Opportunities and threats
Rising oil and gas prices favour the financials of the Company but its effect
on national economy would be devastating in the longrun. There are early
indications of global economic recession, particularly on economies dependent
on oil import.
In this scenario, the company faces two challenges. First, ensuring sustained
growth for the Company and second supporting national cause to minimize the
effect of high energy cost. These challenges can be handled only through
finding new energy assets in the country through intensive exploration and/or
acquiring equity oil and gas overseas.
The Company, carrying the responsibility of nation's energy security concerns,
has committed itself for locating new oil & gas assets in the country,
bringing new sources of energy to stream and aggressively pursuing global
hydrocarbon opportunities. For this, sufficient resources have already been
earmarked.
'Energy Resource Nationalism' has caught the attention of Governments world
over. Energy security options go beyond national boundaries and equity oil and
gas have become priority for the nations.
The Company had realized this long back and responded by forming ONGC Videsh
Limited (OVL) to secure energy security for the country, which is now sourcing
more than six million Tonnes of oil and oil equivalent gas per year from 22 oil
and gas assets in 14 countries.
The Company has committed required resources to support OVL's quest for equity
oil and gas for energy security of the country.
Keeping in view the increasing gas demand in
C. Physical Performance
C.1 Crude oil production
Crude oil production during the year was 26.19 MMT as against 28.13 MMT during
the previous year. Natural Gas production was 24.97 BCM against 25.23 BCM
during the previous year. Less oil and gas production was mainly due to
shortfall in production from Mumbai High, Neelam-Heera and Bassein &
Satellite assets. The shortfall in Mumbai High production was primarily due to
unfortunate BHN platform accident on 27th July, 2005. There was a shortfall in
production from Assam Asset as well.
C.2 Value-added products (VAP)
Production of value added products during the year was 3,364 MT against 3,419
MT during the previous year. VAP production was less mainly on account of less
gas production and supply.
C.3 Drilling
Total 270 wells were drilled during the year out of which 106 were exploratory
wells and 164 were development wells.
C.4 Seismic survey
6,197 Line Kilometers of 2D and 19,865.6 Square Kms. of 3D seismic data were
acquired during the year.
D. Outlook
D.1 Exploration and Production
D.1.1 The Company, in recent years, has taken positive initiatives to
revitalize its oil and gas assets in
D.1.2 Under the present oil price regime, Marginal fields are no longer
marginal. Accordingly, the Company has identified expeditious development of
marginal fields as one of the major thrust area. The Company had identified 153
fields (79 in onshore and 74 in offshore) as marginal fields, as in earlier oil
price regime did not favour development of these fields. The ultimate reserves
of more than 180 Million Tonnes of oil and oil equivalent gas (O+OEG) was lying
idle with these dormant assets.
D.1.3 Out of these 153 fields, 38 fields (Onshore: 36, Offshore: 2) have
already been monetized. 94 fields are under monetization (Onshore: 39,
Offshore: 55) and balance 21 fields are planned for monetization (Onshore: 4,
Offshore: 17). The Company will be malting investment to the tune of Rs 127,000
million and expects that these marginal fields may contribute 50,000 bbls/ day
of oil and 10 MMm 3/day of gas by terminal year of XI Plan.
D.1.4 Technology plays an important role in risk mitigation and value addition
in E&P industry. Recognizing that, in recent years the Company has inducted
best-in-class technology in all spheres of its exploration and production
activities. In addition, the Company has entered into strategic alliances with
reputed service providers like Schlumberger, Halliburton, Baker Hughes, IPR,
Transocean etc., to have cutting edge in E&P The Company has also
established association/ cooperation with major E&P companies like BG, ENI,
CAIRN, SHELL, Norsk Hydro, BP BHP Biliton, etc.
D.1.5 Renewal and replacement of old installations, facilities and pipelines of
the Company is in progress in most of the Assets. More than Rs 20,000 million
is being invested in
AS PER WEBSITE
Global
Ranking
- Is
- Ranks as the
2nd biggest E&P company (and 1st in terms of profits), as per the
Platts Energy Business Technology (EBT) Survey 2004
- Ranks 24th
among Global Energy Companies by Market Capitalization in PFC Energy 50
(December 2004). [ONGC was ranked 17th till March 2004, before the shares
prices dropped marginally for external reasons.
- Is placed at
the top of all Indian Corporates listed in Forbes 400 Global Corporates
(rank 133rd) and Financial Times Global 500 (rank 326th), by Market
Capitalization.
- Is recognized
as the Most Valuable Indian Corporate, by Market Capitalization, Net Worth
and Net Profits, in current listings of Economic Times 500 (4th time in a
row), Business Today 500, Business Baron 500 and Business Week.
- Has created
the highest-ever Market Value-Added (MVA) of Rs. 24,258 Crore and the
fourth-highest Economic Value-Added (EVA) of Rs. 596 Crore, as assessed in
the 5th Business Today-Stern Stewart study (April 2003), ahead of private
sector leaders like Reliance and Infosys. ONGC is the only Public Sector
Enterprise to achieve a positive MV A as well as EVA.
- Is targeting
to have all its installations (offshore and onshore) accredited
(certified) by March 2005. This will make ONGC the only company in the
world in this regard.
- Owns and
operates more than 11000 kilometers of pipelines in
- Crossed the
landmark of earning Net Profit exceeding Rs.10,000 Crore, the first to do
so among all Indian Corporates, and a remarkable Net Profit to Revenue
ratio of 29.8 per cent. The growth in ONGC's profits is not solely due to
deregulation in crude prices in India, as deregulation has affected all
the oil companies, upstream as well as downstream, but it is only ONGC
which has exhibited such a performance (of doubling turnover and profits).
- Has paid the
highest-ever dividend in the Indian corporate history.
- Its 10 per
cent equity sale (
- The Market
Capitalization of the ONGC Group (ONGC & MRPL) constitutes 10 per cent
of the total market capitalization on the Bombay Stock Exchange (BSE).
ONGC has an equity weightage of 5 per cent in Sensex; 15 per cent in the
Nifty (the only Indian corporate with a two-digit presence there); ONGC
commands a 7 per cent weightage in the Morgan Stanley Capital
International (MSCI) Index.
- The growth in
ONGC's Market Capitalization (from Rs. 18,500 Crore before May 2001 to Rs.
1,25,000 Crore in January 2004) is unprecedented and except Wipro (who had
a higher market capitalization temporarily), no other Indian company
(either in public or private sector) has seen such a phenomenal growth.
- ONGC has come
a long way from the day (a few years back) when
- ONGC ended the sectoral regime in the
Indian hydrocarbon industry and benchmarked the globally- established
integrated business model; it took up 71.6 per cent equity in the
Mangalore Refinery & Petrochemicals Limited (MRPL), and also took up a
23 per cent stake in the 364-km-long Mangalore-Hasan-Bangalore product
Pipeline, connecting the refinery to the Karnataka hinterland. By turning
around MRPL in 368 days, ONGC has set standards of public sector companies
reviving joint (or private) sector companies, proving that in business,
professionalism matters, not ownership.
ONGC
Represents India’s Energy Security
ONGC
has single-handedly scripted
- Establishing 6 billion tonnes of
In-place hydrocarbon reserves with more than 300 discoveries of oil and
gas; in fact, 5 out of the 6 producing basins have been discovered by
ONGC: out of these In-place hydrocarbons in domestic acreage, Ultimate
Reserves are 2.1 Billion Metric Tonnes (BMT) of Oil Plus Oil Equivalent
Gas (O+OEG).
- Cumulatively producing 685 Million Metric
Tonnes (MMT) of crude and 375 Billion Cubic Meters (BCM) of Natural Gas,
from 115 fields.
India’s
Most Valuable Company:
- With a market capitalization having
exceeded Rs 1 trillion, ONGC retains it’s position as the most valuable
company in
- As per 5th Business Today Stern-Stewart
study, ONGC was the biggest Wealth Creator during 1998-2003 (Rs 226.30
billion). It was again the highest wealth creator during 1999-2004, as per
Motilal Oswal Securities.
- ONGC’s mega Public Offer (
- ONGC is the
only Indian company to have earned a Net Profit of over Rs 10,000 crores
(2002-03).
- The market
capitalization of the ONGC group constitutes 8% of the market
capitalization of BSE.
- ONGC added
49.06 MMT of ultimate reserves of O+OEG during 2003-04 (including overseas
acquisitions), maintaining the trend of positive accretion for the third
consecutive year.
ONGC’s
Pioneering Efforts
ONGC is the only fully–integrated petroleum company in
- Holds largest
share (57.2 per cent) of hydrocarbon acreages in
- Contributes
over 84 per cent of Indian’s oil and gas production.
- Every sixth LPG
cylinder comes from ONGC.
- About
one-tenth of Indian refining capacity.
- Created a
record of sorts by turning Mangalore Refinery and Petrochemicals Limited
around from being a stretcher case for referral to BIFR to among the BSE
Top 30, within a year.
- Owns 23% of Mangalore-Hasan-Bangalore
Product Pipeline (MHBPL), connecting MRPL to the Karnataka hinterland.
Competitive
Strength
- All crudes
are sweet and most (76%) are light, with sulphur percentage ranging from
0.02-0.10, API gravity ranging from 26°-46° and hence attracts a premium
in the market.
- Strong
intellectual property base, information, knowledge, skills and experience.
- Maximum
number of Exploration Licenses, including competitive NELP rounds.
- ONGC owns and
operates more than 11000 kilometers of pipelines in
Strategic
Vision: 2001-2020
Focusing
on core business of E&P, ONGC has set strategic objectives of :
- Doubling
reserves (i.e. accreting 6 billion tonnes of O+OEG) by 2020; out of this 4
billion tonnes are targeted from the Deep-waters.
- Improving
average recovery from 28 per cent to 40 per cent.
- Tie-up 20
MMTPA of equity Hydrocarbon from abroad.
- The focus of management will be to
monetise the assets as well as to assetise the money.
The
focus of management will be to monetise the assets as well as to assetise the
money.
Sagar
Sammriddhi : Biggest Global Deepwater Campaign
ONGC launched ‘Sagar Sammriddhi’, the biggest deep-water exploration campaign
ever undertaken by a single operator, anywhere in the world.
- Strategic
plan to accrete 4 billion tones of reserves by 2020.
- US$0.75
million per day investment.
- Integrated
Well Completion approach.
- Plans to
drill 47 deepwater wells up to water depths of 3 kms.
To attain the strategic objective of improving the Recovery Factor from 28 per
cent to 40 per cent, ONGC has focused on prudent reservoir management as well
as effective implementation of technologies for incremental recovery to
maximize production over the entire life cycle of existing fields
Improved Oil Recovery (IOR) and Enhanced Oil Recovery (EOR) schemes are being
implemented:
- In 15 fields
including Mumbai offshore
- At a total
investment exceeding US $2.5 billion.
- Yielding incremental 120 MMT of O+OEG
over 20 years
ONGC's
overseas arm ONGC Videsh Limited (OVL), has laid strong foothold in a number of
lucrative acreages, some of them against stiff competition from international
oil majors.
OVL
has so far, acquired 15 properties in 14 foreign countries, and striving to
reach out further
OVL’s projects are spread out in
- Production
Sharing Contract in
- 20 per cent
holding in the Sakhalin–1 Production Sharing Agreement. The US $ 1.77
billion investment in Sakhalin offshore field is the single largest foreign
investment by
- Acquired 25
per cent of equity in the Greater Nile Oil Project in
- Discovered a
world-class giant gas field ‘Shwe” in Block A-1(where OVL has 20 per cent
share) in
- Besides taking
equity in oil & gas blocks and looking for stakes in E&P
companies, OVL is also bagging prospective contracts (like the refinery
upgradation and pipeline contracts in Sudan, awarded to OVL on nomination
basis due to its performance in that country), which will increase ONGC’s
equity oil basket. ONGC’s strategic objective of sourcing 20 million tones
of equity oil abroad per year is likely to be fulfilled much before 2020.
In fact, OVL is now eyeing a long-term target of 60 MMT of Oil equivalent
per year by 2025.
- Going by the
investments (Committed: US $ 4.3 billion, and Actual: US $ 2.75 billion),
ONGC is the biggest Indian Multinational Corporation (MNC).
- Uses one of the
Top Ten virtual Reality Interpretation facilities in the world
- Rolled out
ICE, one of the biggest ERP implementation facilities in the world
Best In Class Infrastructure And Facilities
- ONGC’s
success rate is at par with the global norm and is elevating its
operations to the best-in-class level, with the modernization of its fleet
of drilling rigs and related equipment, at an investment of around US $
400 million.
- ONGC has
adopted Best-in-class business practices for modernization, expansion and
integration of all Info-com systems with investment of around US $ 125
million.
Onshore
- Production
Installation :- 225
- Pipeline
Network (km) :- 7900
- Major
Offshore Terminals (including CFU, LPG, Gas, Sweetening plants, Storage
Tanks) :- 2
- Drilling Rigs
:- 75
- Work Over
rigs :- 66
- Seismic Units
:- 33
- Logging Units
:- 35
Offshore
- Well
Platforms :- 131
- Well-cum-Process
Platforms :- 5
- Process
Platforms :- 28
- Drilling/
Jack-up-Rigs :- 18
- Pipeline
Networks (km) :- 3200
- Offshore
Supply Vessels :- 32
- Special Application
Vessels :- 4
- Highest-ever
dividend paid to shareholders (US$ 930 million)
- Practically
zero debt Corporate
- Contributed
over US $ 20 billion to the exchequer
ONGC is entering LNG (regasification),
Petrochemicals, Power Generation, as well as Crude & Gas shipping,
to have presence along the entire hydrocarbon value-chain. While
remaining focused on its core business of oil & gas E&P, it is also
looking at the future and promoting an applied R&D in alternate fuels (which
can be commercially brought to market). These efforts in integration is
basically to exploit the core competency of the organization – knowledge of
hydrocarbons, gained over the five decades.
ONGC has also ventured into Coal
Bed Methane (CBM) and Underground Coal Gasification (UCG); CBM production would
commence in 2006-07 and UCG in 2008-09. ONGC is also looking at Gas Hydrates,
as it is one possible source that could make
Continuing
On The Growth Trajectory
The ONGC Group has doubled its
turnover from 5 billion US dollars to 10 billion US dollars (from Rs 23,238
Crore to Rs 48,368 Crore) in the last 3 years (2001- 2004); and it aims to go
to 50 billion US dollars in the next 5 years. As this implies a commendable
annual growth rate (compounded) of 40-50 per cent, this objective of ONGC, when
realized, would be an outstanding achievement, by any standards.
ONGC
Is Now Geared To Meet Its Vision
To be an Indian Integrated Energy
Multinational (PSU); Target: A Turnover of 50 Billion US dollars in 5 years.
CMT REPORT (Corruption, Money Laundering & Terrorism]
The Public Notice information has been collected from various sources
including but not limited to: The Courts,
1] INFORMATION ON
DESIGNATED PARTY
No records exist designating subject or any of its beneficial owners,
controlling shareholders or senior officers as terrorist or terrorist
organization or whom notice had been received that all financial transactions
involving their assets have been blocked or convicted, found guilty or against
whom a judgement or order had been entered in a proceedings for violating
money-laundering, anti-corruption or bribery or international economic or
anti-terrorism sanction laws or whose assets were seized, blocked, frozen or
ordered forfeited for violation of money laundering or international
anti-terrorism laws.
2] Court Declaration :
No records exist to suggest that subject is
or was the subject of any formal or informal allegations, prosecutions or other
official proceeding for making any prohibited payments or other improper
payments to government officials for engaging in prohibited transactions or
with designated parties.
3] Asset Declaration :
No records exist to suggest that the property or assets of the subject
are derived from criminal conduct or a prohibited transaction.
4] Record on Financial
Crime :
Charges or conviction
registered against subject: None
5] Records on Violation of
Anti-Corruption Laws :
Charges or
investigation registered against subject: None
6] Records on Int’l
Anti-Money Laundering Laws/Standards :
Charges or
investigation registered against subject: None
7] Criminal Records
No available
information exist that suggest that subject or any of its principals have been
formally charged or convicted by a competent governmental authority for any
financial crime or under any formal investigation by a competent government
authority for any violation of anti-corruption laws or international anti-money
laundering laws or standard.
8] Affiliation with
Government :
No record
exists to suggest that any director or indirect owners, controlling
shareholders, director, officer or employee of the company is a government
official or a family member or close business associate of a Government
official.
9] Compensation Package :
Our market
survey revealed that the amount of compensation sought by the subject is fair
and reasonable and comparable to compensation paid to others for similar
services.
10] Press Report :
No press reports / filings exists on
the subject.
CORPORATE GOVERNANCE
MIRA INFORM as part of its Due Diligence do provide comments on
Corporate Governance to identify management and governance. These factors often
have been predictive and in some cases have created vulnerabilities to credit
deterioration.
Our Governance Assessment focuses principally on the interactions
between a company’s management, its Board of Directors, Shareholders and other
financial stakeholders.
CONTRAVENTION
Subject is not known to have contravened any existing local laws,
regulations or policies that prohibit, restrict or otherwise affect the terms
and conditions that could be included in the agreement with the subject.
FOREIGN EXCHANGE RATES
|
Currency |
Unit
|
Indian Rupees |
|
US Dollar |
1 |
Rs.40.87 |
|
|
1 |
Rs.80.99 |
|
Euro |
1 |
Rs.55.39 |
SCORE & RATING EXPLANATIONS
|
SCORE FACTORS |
RANGE |
POINTS |
|
HISTORY |
1~10 |
6 |
|
PAID-UP CAPITAL |
1~10 |
7 |
|
OPERATING SCALE |
1~10 |
6 |
|
FINANCIAL CONDITION |
|
|
|
--BUSINESS SCALE |
1~10 |
9 |
|
--PROFITABILIRY |
1~10 |
5 |
|
--LIQUIDITY |
1~10 |
8 |
|
--LEVERAGE |
1~10 |
8 |
|
--RESERVES |
1~10 |
7 |
|
--CREDIT LINES |
1~10 |
7 |
|
--MARGINS |
-5~5 |
- |
|
DEMERIT POINTS |
|
|
|
--BANK CHARGES |
YES/NO |
YES |
|
--LITIGATION |
YES/NO |
NO |
|
--OTHER ADVERSE INFORMATION |
YES/NO |
NO |
|
MERIT POINTS |
|
|
|
--SOLE DISTRIBUTORSHIP |
YES/NO |
NO |
|
--EXPORT ACTIVITIES |
YES/NO |
YES |
|
--AFFILIATION |
YES/NO |
YES |
|
--LISTED |
YES/NO |
YES |
|
--OTHER MERIT FACTORS |
YES/NO |
YES |
|
TOTAL |
|
64 |
This score serves as a reference to assess SC’s credit risk and
to set the amount of credit to be extended. It is calculated from a composite
of weighted scores obtained from each of the major sections of this report. The
assessed factors and their relative weights (as indicated through %) are as
follows:
Financial
condition (40%) Ownership
background (20%) Payment
record (10%)
Credit history
(10%) Market trend
(10%) Operational
size (10%)
RATING EXPLANATIONS
|
RATING |
STATUS |
PROPOSED CREDIT LINE |
|
|
>86 |
Aaa |
Possesses an extremely sound financial base with the strongest
capability for timely payment of interest and principal sums |
Unlimited |
|
71-85 |
Aa |
Possesses adequate working capital. No caution needed for credit
transaction. It has above average (strong) capability for payment of interest
and principal sums |
Large |
|
56-70 |
A |
Financial & operational base are regarded healthy. General
unfavourable factors will not cause fatal effect. Satisfactory capability for
payment of interest and principal sums |
Fairly Large |
|
41-55 |
Ba |
Overall operation is considered normal. Capable to meet normal
commitments. |
Satisfactory |
|
26-40 |
B |
Unfavourable & favourable factors carry similar weight in credit consideration.
Capability to overcome financial difficulties seems comparatively below
average/normal. |
Small |
|
11-25 |
Ca |
Adverse factors are apparent. Repayment of interest and principal sums
in default or expected to be in default upon maturity |
Limited with
full security |
|
<10 |
C |
Absolute credit risk exists. Caution needed to be exercised |
Credit not
recommended |
|
NR |
In view of the lack of information, we have no basis upon which to
recommend credit dealings |
No Rating |
|