ONGC’s Rs.18,365 cr investment proposal in OPaL to enter petrochemicals approved

The government has approved ONGC’s proposal to additionally invest Rs.18,365 crore in ONGC Petro-additions Limited (OPaL), the oil and gas giant announced in a statement on Firday, August 9, 2024, and added that this would increase ONGC’s stake in OPaL from 49.36% to 95.69%.
This move is to increase ONGC’s presence across the downstream and petrochemical value chain.
ONGC’s total investment in OPaL so far will also thus, add up to Rs.22,728 crore.
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OPaL is a petrochemical complex based in Dahej, Gujarat, which was commissioned in 2017. It has the largest standalone dual feed cracker in South-East Asia.
A dual feed cracker converts naphtha and offgases from refining into polymer grade ethylene and propylene using a process which is known as thermal cracking. Thermal cracking can also produce byproducts such as benzene, butadiene, gasoline, and toluene.
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OPaL has the capacity to produce up to 1.5 million metric tonnes per annum (MMTPA) of polymers and 0.5 MMTPA of chemicals and has a 12% market share in India’s polymer segment.
The deal can also make OPaL be able to get a sustained supply of gaseous feed from ONGC at a premium of up to 20% over the government’s Administered Pricing Mechanism (APM) gas price. ONGC is currently allowed a premium of up to 20% over the APM price.
Oil and Natural Gas Corporation Ltd (ONGC) shares closed at ₹332.60 on the Bombay Stock Exchange (BSE) after the trading session on Friday, August 9, 2024. This was a gain of 9.90 points or 3.07%.
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