ONGC now a ‘gas-and-oil’ co as output shift accelerates toward natural gas

New Delhi, June 21: Oil and Natural Gas Corp (ONGC) should increasingly be seen as a “gas-and-oil” company rather than an oil-and-gas producer, its chairman Arun Kumar Singh said, underscoring a strategic shift as natural gas output outpaces crude oil.
“Gas is now slightly more than oil in our portfolio,” Singh told analysts, adding that ONGC’s future growth will be driven largely by gas production even as crude output remains broadly flat without major new discoveries.
“We should call ourselves a gas and oil company, not an oil and gas company.” Singh said gas is emerging as the dominant growth driver for the state-run explorer, with rising domestic demand, supportive pricing reforms and new field developments pushing production higher.
“Gas is a more valued fuel in the Indian context, and ONGC is gradually becoming a more gas-heavy company,” Singh said, adding that gas output already exceeds oil and will continue to expand over the coming years.
While oil production is likely to remain flat, gas output will rise as newer fields are put into production. With one of the best pricing in the world, gas is now a more lucrative portfolio, he said.
Singh said gas is becoming increasingly attractive relative to oil due to pricing reforms, with ‘new well gas’ linked to 12 per cent of crude prices, and described India’s rising gas demand – including from transport – as a key structural driver.
He added that while oil production is likely to remain broadly flat without major discoveries, ONGC’s growth trajectory will increasingly be “gas-led”. (PTI)