ONGC faces flak on funds for OVL's overseas forays

The petroleum ministry has criticised ONGC Videsh Ltd (OVL) for not providing the government with details of its overseas acquisitions and has suggested that its parent company, Oil and Natural Gas Corp, make available sufficient funds for OVL for overseas equity oil.

Sources said while OVL claimed that it preferred to send only a brief note in advance to avoid leakage of sensitive commercial information, the ministry said such a short time was not enough to thoroughly examine equity participation proposals.

The ministry states that the empowered committee of secretaries require "OVL to provide sufficient information well in advance for the deliberations at the committee's meets to be purposeful".

In the absence of a prior, detailed agenda note, not only was the examination incomplete, but the participants at the meeting also were unable to reflect the views of the ministry, it added.

OVL claims that it prefers to send a brief note and make an elaborate presentation during the meeting.

This is because usually the party inviting bids requires strict confidentiality and there are possibilities that sensitive information may be leaked if they are circulated in the ministry, OVL says.

Sources said the ministry also felt that OVL might have to go in for further acquisition to achieve the targets given in the "India Hydrocarbon Vision 2025 (IHV 2025)" statement. ONGC should concentrate on exploration and production activities in India and provide full financial support to OVL to achieve its target by not deploying its funds to other sectors, the proposal said.

The IHV 2025 targets accessing 60 million tonnes per annum of oil through equity oil from abroad by 2025. But an analysis of assets held by OVL indicates that only 10 million tonnes may be available to it by 2009-10.