ONGC, Hindujas ink LNG pact

State-owned oil and gas exploration firm, ONGC on Wednesday signed an agreement with the multi-billion dollar diversified Hinduja group for sourcing LNG but failed to arrive at a consensus on another agreement for acquiring oilfields abroad.

An MoU was inked by ONGC with the Hinduja group firm Ashok Leyland Projects Services (ALPS) to form a new JV company, which would scout for LNG in the Gulf and West Asian countries like Qatar, Kuwait, Libya, Oman and Saudi Arabia.

ONGC is to hold 49.98% stake in the venture with ALPS, which will get 48.02%. The remaining 2% would be held by banks and financial institutions.

Sources revealed that an agreement for a similar venture with Gulf Oil Corporation for pursuing exploration projects in West Asia could not be reached over differences on shareholding pattern.

?Hinduja?s were seeking a majority stake in the other joint venture, which was not acceptable to us,? a senior company official said. Sanjay Hinduja represented the Hinduja group for the day-long discussions at ONGC headquarters in the capital.

A ONGC release said, ?The MoU between ONGC and ALPS provides for sourcing of LNG at competitive terms. Pursuant to such sourcing, ALPS will be invited to participate in joint development of LNG-based downstream projects at ONGC?s Mangalore SEZ like LNG-regasification, power, petrochemicals.?

The tie-up with Hinduja follows a similar arrangement by ONGC with Mittal Steel to use the influence of the world?s largest steel maker in African and Central Asian countries.

ONGC is keen to leverage the clout of Hindujas in the Gulf region, particularly in Iran and Qatar, to source LNG for its proposed Rs 25,000 crore Mangalore integrated project that includes an LNG import terminal, a 1,445 mw power plant and a basic petrochemical complex.

Source: The Financial Express, New Delhi
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