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Oil And Natural Gas

Corporation Limited

07 July 2017
ONGC is the flagship
National Oil Company of India, a
Maharatna, with interests in
E&P, Refining, LNG, Power,
Petrochemicals & New sources of
energy.

Majority shareholder: Govt. of India (68.07%)

2
ONGC - Evolution
In 1955, GoI decided to
1955 Oil and Gas Division, GSI*
develop Oil and Natural Gas
resources in various regions 1955 Oil and Gas Directorate, GoI
of the country as a part of 1956 Oil & Natural Gas Commission
Public Sector Development.
1959 Autonomous Statutory Body

With this objective, Oil and


1994 Public Limited Company
Natural Gas division was set-
1997 A Navaratna PSU
up in Oct1955 under
Geological Survey of India. 2010 A Maharatna PSU

*Oil & Natural Gas division set-up in Oct1955 under Geological Survey of India to explore & develop hydrocarbon resources. 3
Promoted
Petronet LNG Exploring for CBM,
Refine > Ltd. UCG, Shale gas &
325,000 bpd 12.5% equity Alternates
of O+OEG

Petrochemicals,
Power,

Produce* ~
1.27 mbpd of Extract ~ 3.2
O+OEG MMTPA of
VAP

* Domestic
4 & Overseas Assets
Seismic data Acquisition, Processing
& Interpretation (API)
Well drilling & Work-over operations

Well testing & stimulation

ONGC has in-house Production & Processing


capability in entire
facets of upstream Oil Reservoir Management
& Gas business
Applied R&D and Training

Engineering & Construction

Transportation, etc.

5
Processing Infrastructure

Hazira, Gujarat
Handling Capacity: 42 MMSCMD Sour Gas
Products: LPG, Naphtha, SKO, ATF, Propane

Uran, Maharashtra

Handling Capacity: 20 MMTPA Oil & 16 MMSCMD Gas


HSD Products: LPG, C2-C3, Naphtha
C2-C3 Plant, Gujarat

Handling Capacity: 4.9 MMTPA of LNG


Products: Ethane (C2), Propane (C3) and Butane (C4)

LPG Liquefied Petroleum Gas Ankleshwar and Gandhar, Gujarat


SKO Superior Kerosene Oil Handling Capacity: 0.1 MMTPA Oil & 1 MMSCMD Gas
C2-C3 Ethane- Propane Products: LPG, Naphtha
HSD High Speed Diesel
LSHS Low Sulphur Heavy Stock Tatipaka, Andhra Pradesh
ATF Aviation Turbine Fuel Handling Capacity: 0.1 MMTPA Oil
Products: Naphtha, SKO, HSD, Fuel Oil
MMTPA- Million Tonnes Per Annum
MMSCMD-Million Standard Cubic Meter per day
6
E&P Infrastructure
Offshore Installation Onshore Installation
254 250
Pipelines
23,100 Km
Process Installations
14 OSVs/ MSVs
9+63*
FPSO
2 Well Stimulation
Vessel: 1+1*
Institutes / Centers
of Excellence : Seismic Crews
11 17+3 (VSP)

Diversified Talent Drilling Rigs


33,156 70+36*

Work-over Rigs
54+22*

Well Stimulation Well Logging units


Units: 124 28+45*
* Charter-hired
7
As on 01.06.2017
ONGC : Production Centers
Production FY17*: Oil - 22.25 MMT; Gas - 22.09 BCM

Jodhpur Domestic Producing Areas


Gas: 0.005 BCM
Mehsana
Oil: 2.12 MMT Assam
Gas: 0.21 BCM Bokaro Oil: 0.81 MMT
Gas: 0.002 BCM Gas: 0.38 BCM
Ahmedabad
Oil: 1.33 MMT Jorhat
Gas: 0.14 BCM Oil: 0.14 MMT
Ankleshwar Gas: 0.05 BCM
Oil: 0.85 MMT
Gas: 1.13 BCM
Tripura
Rajahmundry Gas: 1.43 BCM
Cambay
Oil: 0.28 MMT Cond: 0.003 MMT
Oil: 0.18 MMT
Gas: 0.87 BCM
Gas: 0.01 BCM
Eastern Offshore
Mumbai Offshore
Oil: 0.016 MMT
Oil: 16.27 MMT
Gas: 0.47 BCM
Gas: 16.41 BCM Karaikal
Oil: 0.24 MMT
* ONGC operated domestic fields Gas: 0.98 BCM 8
Institutes

G&G
KDMIPE Basin Modeling
Management
Development
ONGCA
Seismic Data
GEOPIC Processing
Technology hub
Well Logging Dehradun
CEWELL Drilling
Vadodara IDT Technology
Jorhat
Oil field Ahmedabad
equipment SMP Panvel Geo-microbial
maintenance INBIGS prospecting
Goa
Reservoir Geotechnical &
Management IRS IEOT Structural Enng.

Health, Safety & IPSHEM IOGPT Production


Environment Engineering

9
ONGC Group
E&P
domestic
operations

Subsidiaries Joint Ventures Associates

Overseas E&P Refinery Petrochemicals Power


LNG
(100%)
(50%)

(71.62%) (49.36%)
Services
(12.5%)

(ONGC: 49%, MRPL: 51%) Logistics


(50%)

MRPL: Mangalore Refinery & Petrochemicals Ltd.


OPaL: ONGC Petro-additions Ltd.
Pipeline SEZ (49%)
OMPL: ONGC Managlore Petrochemicals Ltd.
OTPC: ONGC Tripura Power Company Ltd.
OTBL: ONGC TERI Biotech Ltd.
MSEZ: Mangalore SEZ Ltd.
DSL: Dahej SEZ Ltd. (28.77%)
PLL: Petronet LNG Ltd.
(26%) (50%)
PHL: Pawan Hans Ltd.

10
Shareholding Pattern*
FII NRI NBFC
0.23% 0.06% 0.00%
FPI
5.73%

IOCL
Govt. 7.69%
68.07% GAIL
2.40%

Banks
0.06%

FIs/Insurance
UTI companies
0.07% 10.21%
Bodies Corporate
Mutual Funds
1.41%
1.77%
Public Employees
2.25% 0.05%

No. of shares: No. of shareholders*: Market cap#:


12833 billion 660301 (FIIs : 42) US$ 27.75 billion

* As on 30.06.2017 11
Trading data on BSE

ONGCs Share Price Movement


RS.

Source BSEINDIA website. Qtrly Share Price movement July 16 to June 17 12


ONGC Board
Chairman & Managing Director
Shri Dinesh K. Sarraf
Functional Director Government Independent
(Full Time) Nominees Directors
Director (T&FS) Shri Amar Nath, Shri Ajai Malhotra
Shri Shashi Shanker JS, MoP&NG

Director (Offshore) Prof S.B. Kedare


Shri T K Sengupta Vacant

Director (HR) Shri K M Padmanabhan


Shri D D Misra
Shri Deepak Sethi
Director (Exploration)
Shri A K Dwivedi
Shri Vivek Mallya
Director (Onshore)
Shri V P Mahawar Shri Sumit Bose

Director (Finance) Dr. Santrupt B. Misra


A.K. Srinivasan
Vacant

Vacant

As per the SEBI Listing Regulations 2015 read with Companies Act 2013, ONGC shall require two more Independent Directors (including
one woman Director).

13
Corporate Governance in ONGC

Corporate Governance is the


basis for decision-making and
control processes which
comprises of responsible,
value-based management &
monitoring, focused on long
term success, goal
orientation, transparency and
safeguarding the interest of
all Stakeholders.

14
Corporate Governance in ONGC
Constitution of 15 Board Level Committees to discuss threadbare
most of the agenda items before being recommended to the
Board for an informed decision

1. Audit & Ethics Committee


2. Nomination & Remuneration 9. CSR & Sustainability Development
Committee
10. COD for issue of Duplicate Shares
3. Stakeholders Relationship
Committee 11. Risk Management Committee
4. HR Management Committee 12. R&D Committee
5. Project Appraisal Committee 13. Project Review Committee
6. HSE Committee 14. COD for Review of Operations
7. Financial Management Committee 15. COD for Review of JV & Subsidiaries
8. Committee on Dispute Resolution

15
Corporate Governance in ONGC
Robust Internal Control Mechanism to monitor critical
businesses, functions and operations

Standardized procedures and guidelines for all facets of activities to ensure


that best practices are adopted even up to ground level.
Dedicated Performance Management & Benchmarking Group (PMBG) to
monitor performance of each business unit against Key Performance
Indicators (KPIs) as defined in Performance Contracts
E-Grievance handling mechanism for quick redressal of grievances of various
stakeholders
Internal & External audits to ensure compliance to various industry norms &
benchmarks
Dedicated Internal Audit group
Third Party audit of all onshore & offshore installations by agencies like Oil
Industry Safety Directorate (OISD)

16
Corporate Governance in ONGC

Enabling IT system across the organization


across the Supply Chain Management (SCM)

All transactions on SAP R/3 Platform


Purchase to Sales
In-built VAT/ CENVAT/ Service Tax/ GST
E-procurement with Reverse Auction
Vendor payments through NEFT
Invoice monitoring system
IT solutions to monitor
Internal Audit observations
RTI applications
Vigilance Cases

17
Corporate Governance in ONGC

Tendering: Tender website

All NITs > Rs. 0.5 million uploaded

Vendors can download bid documents

Facilitates linkage to e-procurement


portal

All tenders (>Rs. 1 million) available


on the website

18
Corporate Governance in ONGC

Integrity Pact (IP) ONGC the first Indian Corporate to sign


MoU with TI (India) Ltd in Apr06

Adopted from a presentation organized by CVC


in Bangalore in May 2005

The concept uploaded on Tender website


Noted comments from major Vendors

Draft was vetted by the then Solicitor General


of India

IP is devised by Concept implemented across the organization


Transparency International in Aug05

19
ONGC: Domestic Production

Physical Performance

Crude oil production (MMT) Natural gas production (BCM)

22.56 23.55 23.28 22.02 22.09


22.25 22.26 22.36 22.25 21.18

3.57 3.75 3.68 3.57 3.28


1.79 1.57 1.50 1.35 1.19

FY'13 FY'14 FY'15 FY'16 FY'17 FY'13 FY'14 FY'15 FY'16 FY'17
ONGC (Oil) PSC-JV (Oil) ONGC (Gas) PSC-JV (Gas)

20
ONGC: Financials

Gross Revenue & PAT (` Crore)

83,309 84,201 83,094


77,740 77,907

20,926 22,095 17,900


17,733 16,140

FY'13 FY'14 FY'15 FY'16 FY'17


Turnover Net Profit

21
Efficiency Parameters
RRR* (2P)
2
Commercial Speed 1.47 1.51 1.45
1.5 1.38
(meterage/rig-month) 1.25 1.24
1
1,600
0.5
1,400
0
Meterage/ Rig-month

1,200 FY'12 FY'13 FY'14 FY'15 FY'16 FY'17


1,000
800
1472
600 1150 1180 Gas Flaring (%)
400 4 3.47
3.06
200 2.62 2.76
3 2.23 2.4
0
2
FY'15 FY'16 FY'17
1
0
FY'12 FY'13 FY'14 FY'15 FY'16 FY'17

* RRR Reserve Replacement Ratio

22
60 Years of Exploration
ONGC discovered
6 out of the 7 producing Basins of India

1889: Assam Shelf *


1967: Rajasthan Basin

1973: A&AA FB
1958: Cambay Basin
1980: KG Basin
1974: Mumbai
Offshore
1985: Cauvery
Basin

* By AR & T Co. - Assam Railways and Trading Company Ltd.

23
Exploration Successes

FY17: 23 Oil & Gas discoveries (4 in NELP blocks)


Oil & Gas: 12; Gas/Gas-Condensate: 8; Oil: 3 (Onshore: 13; Offshore:10)

New Prospects Discovery: 12 New Pool Discovery :11


Offshore Offshore
1 KGS092NA-SRI-1 / SRI-AA Oil & Gas 1 MBS051NAA-2 / NAA-B Gas & Conden
2 B-34-2 / B-34-B Oil & Gas 2 B-12C / B-12C-2 / B-12C-A Gas & Conden

Kutch Basin
3 B-157N-1 / B-157N-A Oil & Gas Onshore
4 GS-71-1/ GS-71-AA Oil & Gas 3 Dahej/ Dahej-20 / DJAT Gas

5 B-154N-1 / B-154N-A Oil & Gas 4 Nambar/ Nambar-12 /NRAF Gas

6 D-30-2/ D-30-A Oil & Gas 5 Nadiad / Nadiad-4 / NDDA Oil

7 G-1-N-2 / G-1-N-AB Oil & Gas Kesanapalli / Kesanapalli


6 Oil & Gas
West Deep -1 /KWD-AA
8 GKS101NCA-1 /GKS101NCA-A Gas
West Penugonda/ Thurupu
Onshore 7 Gas
Vipparu-1 / TVAA
South Akholjuni / Akholjuni-29/ 8 Geleki / G-390 / GKHX Oil
9 Oil & Gas
AKAP Khoraghat / Khoraghat-
9 Oil & Gas
10 Suphayam-2 /SUAA Oil & Gas 38_Z/ KHBB_Z
11 Jabera-4 / RJBF Gas 10 Olpad / Olpad-47 / OPAM Gas
12 Dayalpur-1 / SUAB Oil & Gas 11 Gandhar-724(GGAM) Oil

Jabera discovery brings Vindhayan Basin to reserve map of India

24
ONGC: Oil & Gas sales

ONGC: Crude oil sales (MMT) ONGC: Gas sales (BCM)

25 90.5 93.8 92.3 93.8 94.2 95.1 100


20 9.1%
19 Gas sales
8.4%
Crude production/ sales (MMT)

Crude sales as % of production


20 80 18 7.7%
7.0%
17 6.3%
15 60 16 5.6%

15 4.9%
4.2%
10 40 14 3.5%
13 2.8%
5 20 2.1%
12
1.4%
11 Gas flaring 0.7%
0 0 10 0.0%

FY'12 FY'13 FY'14 FY'15 FY'16 FY'17 FY'13 FY'14 FY'15 FY'16 FY'17
Oil Sales % Sales Gas sales (BCM) Gas flaing (%)

Increase in sale on account of improved Gas flaring reduced in FY17 to 2.4% vs 3.06% in
processing, control and reduction of losses FY16

25
O+OEG Production

ONGC is the largest Crude Oil & Natural Gas producer in India;
contributed 72% of O+OEG production of the country in FY17*.

FY17*: Crude oil production in India FY17*: Natural gas production in India
= 36.02 MMT (FY16: 36.95 MMT) = 31.90 BCM (FY16: 32.25 BCM)

Crude Oil Natural Gas

Private Private
Operators Operators
20% 18%
OIL
OIL
9%
9%

ONGC
ONGC
71%
73%

*ONGCs production includes its share in PSC JVs 26


ONGC Group: O+OEG Production, FY17

FY17: Production increased by 7.4% compared to FY16 as contribution from


Overseas Assets Sakhalin & Vankorneft fields in Russia and positive contribution
from domestic fields

61.60
58.73 59.20 58.34 57.38
4.37
2.92 2.87 3.34 1.18
1.79 1.57 1.50 3.41
1.35

22.09
23.55 23.28 22.03 21.18

4.34 5.49 5.53 5.51 8.43


3.57 3.75 3.68 3.57 3.28

22.56 22.25 22.26 22.36 22.25

FY'13 FY'14 FY'15 FY'16 FY'17


ONGC (Oil) PSC-JV (Oil) OVL (Oil)

27
ONGC Group: Financials, FY17

ONGC Group PAT increased by 59% during FY17

Turnover ` Crore PAT


142,149
135,664 20,498

12,875

FY'16 FY'17 FY'16 FY'17

28
ONGC Videsh Ltd.

ONGC Videsh, a wholly owned subsidiary of ONGC

Overseas investment US$ 27.51 billion till


FY17
2P Reserves of 704 MMtoe as on 01.04.2017
FY17: Oil & Gas production 12.80 MMtoe

29

29
ONGC Videsh: Global footprint

37 projects in 17 Discovered/
Producing: 14 Exploration: 17 Pipeline: 2
countries Develop: 4
CIS

Azerbaijan 1

Russia 3

Kazakhstan 1 South East Asia


Vietnam 1 1

Myanmar 2 2

Bangladesh 2

Asia-Pacific
Middle East N. Zealand
1
Syria 1 1
Africa
Latin America
Libya 1 Iraq 1
Venezuela 1 1
Sudan 1 Iran 1
Colombia 7 1
South Sudan 2
Brazil 1 1
Mozambique 1

30
ONGC Videsh: Overseas Production

FY17: Highest-ever production of 12.80 MMtoe (increase of 43%)

Mainly due to acquisition of stake in Vankor

FY17: Country wise production


12.80

4.37 Azerbaijan
8.87 8.92 Vietnam 7%
8.36 12%
7.26 Myanmar
2.87 3.34 3.41 7%
2.92
8.43
4.34 5.49 5.53 5.51 Brazil
5%
Russia
56% Colombia
4%
FY'13 FY'14 FY'15 FY'16 FY'17 Venezuela

Oil (MMT) Gas (BCM) Sudan 5%


4%

31
ONGC Videsh: Financials

Total Income & PAT (` Crore)

22,224
19,149
18,029

10,080
9,862

3,929 4,445
1,904 701

FY'13 FY'14 FY'15 FY'16 FY'17


-3,633
Turnover (Rs. Crore) PAT (Rs. Crore)

32
Mangalore Refinery Petrochemicals Ltd. (MRPL)

15 MMTPA state-of-art Refinery; Now a Schedule-A Company

Highest-ever throughput of 16.27 MMT during FY17

15 MMTPA state-of-art Refinery FY17


Highest-ever production/ dispatch of
Poly-propylene (264 TMT)
LPG (858 TMT)
Diesel (6,565 TMT)
MS (1,142 TMT)

33
MRPL: Financials*

Turnover (` Crore) Profit after Tax (` Crore)


75,227
68,834
62,412 Highest-ever 3,644
59,415
50,864
601 1,147

-757
-1,712

FY'13 FY'14 FY'15 FY'16 FY'17 FY'13 FY'14 FY'15 FY'16 FY'17

During FY17 GRM 7.75 $/bbl; one of the best among PSU refineries

Recommended Dividend @60% (Rs. 6 per share) amounting to ` 1,051.56 Crore.


* Stand-alone

34
ONGC Mangalore Petrochemicals Ltd. (OMPL)
Aromatic Petrochemical Complex producing Paraxylene & Benzene;
production commenced from 1st October 2014

OMPL is consistently operating at ~


95% capacity utilization in the past six
months, achieving positive PAT for the
first time in the month of February
2017

Feedstock@ Products
Achieved highest revenue of ` 5,256
Crore with highest exports of ` 3,900
Naphtha & Para-xylene: 914,000 Crore in FY17 establishing a niche
TPA
Aromatic
Benzene: 283,000
presence in the International market
streams
TPA

* wef 28th Feb 2015

35
OMPL: Financial

Turnover and PBT

6000
5,257
5000
4,188
4000
3000
Rs. Crore

2000
1000
0
FY'16 FY'17
-1000 -493
-879
-2000
Turnover PBT

36
ONGC Petro Additions Ltd. (OPaL)
Successfully raised Rs 7,286 Crore through
Compulsorily Convertible Debenture at
competitive interest rates.
With this the entire equity of Rs 11,230 Crore
has been tied.

OPaL Polypropylene, HDPE and LLDPE well


accepted by the market.

The liquid products such as Butadiene, Benzene


etc being exported at good price.

Largest Polymer Warehouse in India Feedstock Products


1,28,250 sq. m. HDPE/LLDPE
C2 Poly-propylene
Locational Advantage Strong C3 Benzene
Connectivity C4 Butadiene
Naphtha Pyrolysis Gasoline
State of the art Infrastructure Carbon Black Feed Stock

37
ONGC Tripura Power Company Ltd. (OTPC)

726.6 MW (363.3x2) Combined Cycle Gas Turbine (CCGT) thermal power plant

Plant achieved highest generation of 747 MW (103%) on 15th February 2017.


Generated record 4170 million units during FY17
Meets 35% power requirement of North Eastern states.
First Dividend paying standalone gas based power generation company in India
CERC certification obtained

Equity holding: ONGC (50%), Govt. of Tripura


(0.5%), IEDCL (26%) & IDFC (23.5%) Project cost: ` 4,047 Crore. (Debt/Equity=75:25)

Financials FY17
Turnover ` 1,298 Crore up 18% from ` 1,099 Crore during
FY16
Net Profit ` 130.45 Crore, a 9 fold jump from ` 12.96 Crore
in FY16.
IEDCL: IL&FS Energy Development Company Limited
IDFC: India Infrastructure Fund-II through IDFC Alternatives Ltds
38

38
Evolution of Upstream industry in India

HELP

NELP era
254 blocks
Pre-NELP era
28 Blocks, 29 Fields

Nomination era
355 ML, 24 PEL
Pre Independence PSC Regime
era

1886 - 1946 1947 - 1990 1990 - 1996 1997 2015 2016 - onwards

39
HELP - 2016
Hydrocarbon Exploration & Licensing Policy (HELP)
announced in 2016 will simplify the policy

Uniform license for exploration & production of


all forms of hydrocarbon,
An open acreage policy,
Easy to administer revenue sharing model and
marketing and pricing freedom for the crude oil
and natural gas produced.

The uniform licence will enable the contractor to explore conventional as well as
unconventional oil and gas resources including CBM, shale gas/oil, tight gas and
gas hydrates under a single license. The concept of Open Acreage Policy will
enable E&P companies choose the blocks from the designated area.

40
Domestic Gas & Midstream Milestones

1974 Mumbai High Discovery

1976 Bassein Field Discovery in West Coast

1984 Formation of Gas Authority of India Ltd.

1986 Laying of Hazira-Vijaipur-Jagdishpur (HVJ) Pipeline

1991 HVJ Pipeline commissioned

2002 Reliance discovers a large gas field KG-D6 in East Coast

2004 First LNG import at Petronet LNG Ltd.s Dahej terminal

2016 Gas Price revision linked to market dynamics

41
Gas price revision

After promising a price premium for gas produced from discoveries in


high pressure-high temperature, deepwater and ultra deepwater
areas in October 2014, the Indian Government outlined how such a
pricing mechanism will be structured.

On March 10, 2016, the GOI approved - proposal to grant certain


marketing freedoms, including pricing freedom for gas produced
from high pressure-high temperature, deepwater and ultra
deepwater areas. This pricing freedom would be capped by a ceiling
price, calculated (in US$/mmBtu) as the lowest of:
o Fuel oil landed import price;
o Weighted average landed import price of alternative fuels (0.3 x
price of coal + 0.4 x price of fuel oil + 0.3 x price of naphtha); and
o LNG landed import price.

42
Gas price revision
However, within a period of less than two years, the domestic natural gas
price is expected to drop to less than half from US$ 5.05 to US$ 2.45 per
mmbtu.
Even existing price of US$ 3.06/ mmbtu on GCV basis (equivalent to US$
3.40/mmbtu on NCV basis) is lower by 20% even from price of APM gas
fixed on NCV basis (i.e. US$ 4.2/mmbtu) and lower by 20%-35% from price
of non-APM gas (US$ 4.2/mmbtu to US$ 5.25/mmbtu) which was applicable
till Oct14.
Applicable Equivalent
Domestic Gas Domestic Gas
Period %age change
Price price
GCV basis NCV basis
01.11.14 to 31.03.15 5.05 5.61
01.04.15 to 30.09.15 4.66 5.18 -7.66%
01.10.15 to 31.03.16 3.82 4.24 -18.15%
01.04.16 to 30.09.16 3.06 3.40 -19.81%
01.07.16 to 31.03.17 2.50 2.78 -18.24%
01.04.17 to 30.09.17 2.48 2.75 -1.08%

Issue: Floor price for APM and Non-APM gas

43
Awards and Accolades
Special technical award Greening of Oil and Gas Business, Corporate during
Petrotech 2016 for excellent and outstanding commitment & contributions
towards greening of oil and gas business
Energy and Environment Foundation Global Sustainability Award 2016 in Gold
Category for excellent and outstanding contributions, commitment and actions that
have made a positive impact on the environment

Hindustan Ratna PSU awards forExcellence in CSR practices


FICCI Award under category Environmental Sustainability, for the Eastern Swamp
Deer Conservation Project

Bhamashah Awards by Government of Rajasthan for setting up of smart class


rooms in 8 government school
DMA Award: The Delhi Management Association award for Outstanding CSR
project award
17th Greentech Environment Award under Gold category
44
Thank You