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ONGC mulls buying out rest of OPaL

September 12/2019

MOSCOW (MRC) -- Indias Oil and Natural Gas Corp Ltd plans to buy out the rest of ONGC Petro additions Ltd (OPaL), majority-owned by ONGC, and launch a public offering if it fails to find a strategic partner for it, as per Plastemart.

ONGC has long tried to bring in a strategic partner in the petrochemical project but failed to strike a deal so far.

ONGCs stake in the project could rise to 70% if it converts INR 26 billion of share warrants into equity and to about 93% if it also converted INR 77.78 billion of debentures into shareholdings, Kumar said. ONGC owns 49.36% of the project and gas utility Gail (India) Ltd owns another 49.21%. The remaining stake is held by Gujarat State Petroleum Corp Ltd, a state government-owned gas company.

"We are looking at various options. Our first preference is to convert OPaL into a subsidiary by converting share warrants and debenture into equity if we dont get a strategic partner," Subhash Kumar, ONGCs director of finance told Reuters. "Another option is to merge OPaL with ONGC. ONGC will decide by the end of its fiscal year on whether to make OPaL a subsidiary, he said. "After making it a subsidiary, it will take another two years to list the company," Kumar said.

OPaL operates a 1.1m tonne/year ethylene cracker, two 360,000 tonne/year linear low density PE (LLDPE)/high density PE (HDPE) swing units, a 340,000 tonne/year HDPE plant and a 340,000 tonne/year polypropylene line at Dahej, in Indias western state of Gujarat.

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 1,255,800 tonnes in the first seven months of 2019, up by 9% year on year. Shipments of all PE grades increased. At the same time, the estimated PP consumption in the Russian market was 796,120 tonnes in January-July 2019, up by 11% year on year. Shipments of PP block copolymer and homopolymer PP increased.

OPaL is a joint venture between Gujarat State Petroleum Corp (GSPC), Gas Authority of India Ltd (GAIL) and ONGC.


mrcplast.com
Author:Margaret Volkova
Tags:PP, PE, LLDPE, PP block copolymer, homopolymer PP, propylene, HDPE, ethylene, petrochemistry, ONGC, Opal, India, Russia.
Category:General News
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