ONGC's Growth Strategy

It also meant that oil PSUs would lose state protection and would have to face the global competitive business environment. Industry experts felt that deregulation would give an edge to domestic PSUs in marketing their products due to their strong investment base, superior infrastructure and extended distribution network. They felt that dismantling APM would also result in increased profitability for oil companies. As expected, the dismantling of APM benefited ONGC significantly. For the fiscal year 2002-03, ONGC reported a 70 per cent jump in net profits to Rs. 105.293 bn as opposed to Rs. 61.979 bn in the previous year. ONGC's revenues increased from Rs. 225.142 bn in 2001-02 to Rs. 342.773 bn in 2002-03, an increase of 53.4 per cent...

An agreement was entered into with Gujarat Government for setting up a Special Economic Zone (SEZ) for this purpose, including a 2,000 MW power plant based on re-gasified natural gas. In addition, another SEZ was planned in Kakinada, Andhra Pradesh, to establish a power plant and an LNG import terminal. Another 2,000 MW plant was planned adjacent to the company's subsidiary, MRPL, in Karnataka. However, ONGC did not plan to venture into transmission and distribution of electricity or power trading. As gas transportation was uneconomical, power plants were planned at gas fields and the power generated was proposed to be sold to grids or captive users. ONGC also planned to foray into areas like LNG marketing, diesel, naphtha and kerosene, which promised higher realizations...