ONGC Forms Joint Venture with Mitsui OSK Lines for Ethane Transportation

• ONGC has signed JV agreements with Mitsui OSK Lines (MOL) to form two entities focused on ethane transportation.
• ONGC will subscribe to equity shares in Bharat Ethane One IFSC and Bharat Ethane Two IFSC, each with a 50% stake.
• The joint ventures will operate Very Large Ethane Carriers (VLECs) for transporting ethane from the USA to ONGC's OPaL subsidiary.
• The partnership aims to strengthen ONGC's role in energy logistics and specialized shipping.
• The venture has received support from the Ministry of Petroleum and Natural Gas and DIPAM, Ministry of Finance.

Oil and Natural Gas Corporation (ONGC) has entered into joint venture (JV) agreements with Mitsui OSK Lines (MOL), a prominent Japanese shipping company, to form two joint venture entities. The agreements, signed on Monday, involve ONGC subscribing to equity shares in Bharat Ethane One IFSC and Bharat Ethane Two IFSC, both based in Gift City, Gandhinagar. As part of the deal, ONGC will subscribe to 2,00,000 equity shares, priced at Rs 100 per share, in each of the two companies. This equity subscription will give ONGC a 50% stake in both entities, with MOL holding the remaining 50%.

Read More About Ethane Production Cost Reports - Get Free Sample Copy in PDF

The partnership leverages MOL's global expertise in maritime operations and ONGC's strong regional presence and operational capabilities. The collaboration is designed to add significant value to the energy transportation and logistics sector. Each joint venture company will own and operate one Very Large Ethane Carrier (VLEC), which will be registered under the Indian flag and used for transporting ethane from the United States to India. This ethane will be delivered to ONGC Petro additions (OPaL), a subsidiary of ONGC, to meet its feedstock requirements.

This venture is a strategic move for ONGC, marking its entry into business diversification and expansion. By deploying VLECs for ethane transportation, the company aims to capitalize on emerging opportunities in energy logistics, strengthen its position in the value chain, and establish a more robust presence in specialized shipping. The initiative also has the backing of the Ministry of Petroleum and Natural Gas and the Department of Investment and Public Asset Management (DIPAM) under the Ministry of Finance.