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Pratim Ranjan Bose

Kolkata , Jan. 25

ONGC is once again reported to be pushing for a shipping subsidiary as a joint venture with a global leader in the logistics business.

The company's previous attempt to enter into a shipping joint venture with a 49 per cent stake was turned down by the Government on the grounds that the proposed company would not remain under the surveillance of watchdogs like the Central Vigilance Commission because of its non-PSU status.

The oil exploration and production major currently owns over 30 supply vessels and charters crude carriers, offshore rigs and multi-purpose supply vessels from across the world. The company is currently considering buying a crude oil carrier.

The number of vessels is set to increase manifold once the methane and propane extraction plants and petrochemical projects come up at Dahej and Mangalore, which will eventually turn the group into a major exporter of petro-products.

The movement of crude oil resulting from the operations of ONGC Videsh will increase substantially once production begins in the Sakhalin-I block in Russia in the latter half of 2005, where ONGC owns a 20 per cent stake.

Sources say that ONGC is losing out in terms of both cost and availability of ships compared to its global competitors.

Citing the examples of Petronas and Aramco, both of which own large fleets of liquefied natural gas (LNG) and crude carriers respectively, the sources said that oil companies worldwide were treating shipping as a profit centre by roping in their own group carriers for trade in crude or LNG.

On its part, ONGC recently suffered time overruns with regard to two offshore construction projects in Mumbai due to delays caused by the poor availability of barges for supply of material and equipment.

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