ONGC plans power generation

Oil exploration firm ONGC would enter electricity generation business and has planned major power plants at Dahej in Gujarat and Mangalore in Karnataka as part of its forward integration plans. Talking to reporters at a press conference, ONGC CMD Subir Raha said “we will get into gas-to-power business (generating power from natural gas) as part of forward integration plans.”

ONGC is also likely to buy 16.95 per cent stake of HPCL in in Mangalore Refinery and Petrochemicals Ltd (MRPL) for about Rs 550 crore. “A proposal (for acquisition of HPCL’s stake in MRPL) is with the government for approval,” Raha said. The proposal to buy HPCL’s stake would now be put before the cabinet for final approval, he said adding, if approved, ONGC stake in MRPL would climb to 87.95 per cent. HPCL CMD M B Lal said “we have only marginal interest (in MRPL)”.

ONGC has planned mega power plants at Dahej, the site of the country’s first liquefied natural gas (LNG) import terminal. It has already signed an agreement with Gujarat government for setting up a special economic zone, which would include a 2000 MW power plant based on the regassified natural gas.

It has also planned a 2000 MW power plant adjacent to its subsidiary MRPL in Karnataka. “We don’t plan to enter into transmission and distribution of electricity or power trading. We propose to set up power plants at gas fields from where transportation of gas is uneconomical. The power generated could be sold to either grids or captive users,” Raha said.