Oil & Natural Gas Corporation announced on Monday, January 6, that it has signed joint venture agreements and capital contribution agreements with Japan's Mitsui OSK Lines Ltd (MOL) to establish two joint venture entities in GIFT City, Gandhinagar. This strategic partnership marks ONGC's expansion into specialized maritime logistics for petrochemical transportation.

Joint Venture Structure and Investment

The partnership involves the creation of two companies: Bharat Ethane One IFSC Private Ltd and Bharat Ethane Two IFSC Private Ltd. Each entity will receive an equity subscription from both partners, establishing a balanced ownership structure.

Fleet and Operations

Each joint venture entity will own and operate a very large ethane carrier (VLEC) under the Indian flag. The specialized vessels are designed to transport ethane from the United States to supply feedstock for ONGC Petro Additions Limited (OPaL), a subsidiary of ONGC.

Strategic Significance

This initiative represents ONGC's strategic entry into business diversification and growth. The deployment of VLECs for ethane transportation allows ONGC to capitalize on emerging opportunities in energy logistics while strengthening integration across its value chain.

Mitsui brings significant experience to the partnership, currently owning and operating four liquefied natural gas (LNG) ships for Petronet LNG Ltd, India's biggest LNG importer, and six ethane carriers for Reliance Industries Ltd.

Market Context

ONGC plans to import ethane starting in mid-2028 to compensate for the altered composition of LNG sourced from Qatar. This strategy addresses the growing demand for petrochemical feedstock, with ethane serving as a crucial component in ethylene production for various plastic manufacturing processes.

Shares of Oil and Natural Gas Corporation ended at ₹238.05, down by ₹3.41, or 1.41%, on Monday, January 6.

Oil & Natural Gas Corporation has successfully contained a gas leak incident at its Mori Field facility in Andhra Pradesh during workover operations, with no casualties or injuries reported. The incident was flagged by operator Deep Industries Limited, and the company has confirmed that safety risks to the public remain minimal due to the remote location of the affected well.

Incident Details and Safety Measures

The gas leak occurred at Well Mori#5 during routine workover operations in a remote area with no human habitation within approximately 500-600 metres radius. As a precautionary measure, ONGC has secured the site and initiated cooling operations to stabilise the situation while maintaining strict safety protocols.

Emergency Response and Equipment Mobilisation

ONGC has mobilised its Crisis Management Team and Regional Crisis Management Team to oversee containment and response efforts. The company's senior management and technical experts are closely monitoring developments while coordinating with international well-control specialists to support advanced operations, subject to on-site assessment.

Additional specialised equipment is being moved from nearby locations, including Narsapuram, as part of the comprehensive response plan. Preparatory work is underway to enable well-control operations, including the possibility of capping the well if required.

Market Impact

Following the incident, ONGC shares experienced a decline in trading activity. The stock closed 1.41% lower at ₹238.05 on the NSE, down ₹3.41 from the previous session.

Ongoing Monitoring and Communication

The company continues demonstrating its commitment to transparency and stakeholder communication while ensuring the effectiveness of safety protocols throughout the ongoing emergency response operation. ONGC has stated that updates will be shared as the situation evolves, highlighting the operational risks associated with workover activities while maintaining that the leak has been managed without any impact on human life.