Oil & Natural Gas Corporation (ONGC), India's state-owned oil and gas giant, faced a double whammy as its shares declined following U.S. tariff announcements and the company disclosed environmental compensation notices from the Andhra Pradesh Pollution Control Board (APPCB).

U.S. Tariff Impact

ONGC's stock dropped 0.83% intraday after U.S. President Donald Trump announced a 25% tariff on Indian exports. The tariff package includes unspecified penalties for countries importing oil and commodities from Russia. However, petroleum and electricity have been granted exemptions under the new tariff regime.

Despite the market reaction, ONGC's direct exposure to U.S. markets is limited, with operations primarily focused on domestic production and government-linked supply contracts. The company is expected to maintain operational stability in the near term due to its domestic focus and structured trade channels.

Environmental Compensation Notices

In a separate development, ONGC disclosed receiving environmental compensation notices from the APPCB for three of its facilities in Andhra Pradesh. The company made this disclosure in compliance with Regulation 30 of SEBI (LODR) Regulations, 2015.

The affected facilities and imposed compensations are:

The APPCB alleged that the Effluent Treatment Plant (ETP) outlet values at these facilities did not comply with discharge standards. ONGC stated that it has paid the compensation under protest and plans to review the order and file an appeal with the appropriate appellate authority.

Financial Impact

ONGC asserted that considering the size and scale of its operations, the impact of these environmental compensations is not considered significant. The company maintains its position as a key player in India's oil and gas sector, with its primary focus on domestic production and government-linked contracts.

As ONGC navigates these challenges, investors and industry observers will be closely watching how the company addresses both the potential implications of the U.S. tariffs and its environmental compliance measures in Andhra Pradesh.

Oil & Natural Gas Corporation (ONGC), India's state-owned oil and gas exploration and production giant, has received environmental compensation notices totaling ₹1 crore from the Andhra Pradesh Pollution Control Board (APPCB) for alleged violations at three of its facilities in the state.

Facilities Affected and Compensation Details

The environmental compensation notices cover three ONGC facilities in Andhra Pradesh:

Nature of Violations

According to the APPCB, the violations relate to the Effluent Treatment Plant (ETP) outlet values at these facilities allegedly not complying with the prescribed discharge standards. The non-compliance periods range from 92 to 122 days for the different facilities.

ONGC's Response

ONGC has confirmed that it has paid the compensation amount under protest. The company plans to review the order and file an appeal with the appropriate appellate authority. In a disclosure to the stock exchanges, ONGC stated:

"Considering the size and scale of the Company's operations, the impact is not considered significant. Further, the aforesaid payment has been paid under protest."

Financial Impact

While the ₹1 crore compensation is a substantial amount, ONGC does not consider it to have a significant financial impact given the company's operational scale. However, the notices highlight the increasing scrutiny on environmental compliance in the oil and gas sector.

Next Steps

ONGC will be reviewing the APPCB's order and preparing to file an appeal against it. The outcome of this appeal could have implications for the company's operations in Andhra Pradesh and potentially set precedents for environmental compliance in the industry.

As this situation develops, stakeholders will be watching closely to see how ONGC addresses these environmental concerns and manages its relationship with regulatory authorities.