ONGC plans to invest Rs 1 lakh crore for setting up 2 petrochemical plants

16 Nov 2023 , 12:58 PM

As part of its preparations for the energy transition, India’s largest oil and gas producer, ONGC, aims to invest over Rs 1 lakh crore in the establishment of two petrochemical factories that would transform crude oil straight into high-value chemical goods.

Following this development, ONGC hits a new 52-week high of Rs 203.40 on NSE.

Crude oil is the main source of energy that firms like ONGC extract from under the seabed and subterranean reserves. It is refined into petrol, diesel, and jet fuel at oil refineries. Companies all across the world are exploring innovative ways to use crude oil as the world moves away from fossil fuels.

Petrochemicals are chemical compounds obtained from crude oil that are used to make detergents, fibers (polyester, nylon, acrylic, and so on), polythene, and other man-made plastics.

Oil and Natural Gas Corporation (ONGC) Director (Finance) Pomila Jaspal stated during an investor call on the company’s second-quarter earnings that the company is planning to establish separate oil-to-chemical (O2C) projects.

On the investor call, D Adhikari, Executive Director and Chief of Joint Ventures & Business Development, ONGC, stated that the company expects to invest Rs 1,000,000 crore in two projects in two different states by 2028 or 2030.

Petrochemicals, the building blocks for plastics, fertilizers, and medicines, are expected to stay in high demand due to their wide range of applications in huge sectors such as construction, automotive, and electronics.

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