New Delhi: Oil and Natural Gas Corporation (ONGC) is close to launching a dedicated gas trading company, with around 95% of the work completed, according to the latest update. The company is expected to announce the venture after completing some pending approvals and contractual clauses.
The proposed trading company is expected to begin operations by the end of 2026. However, its partner has not yet been finalised, while Dubai or Singapore are being considered as possible locations for its headquarters.
The development comes as ONGC pursues an aggressive strategy to expand exploration, strengthen production from mature fields, grow its gas business and increase its presence in renewable energy.
ONGC Gas Trading Company Nears Launch
ONGC is reportedly in the final stages of setting up its gas trading venture. Around 95% of the process has been completed, with certain approvals and clauses still required before the company can be formally announced.
Key details of the proposed venture include:
- Around 95% of the setup process completed
- Some necessary approvals and contractual clauses are pending
- Partner is yet to be finalised
- Dubai or Singapore could host the headquarters
- Operations are expected to start by the end of 2026
The venture could strengthen ONGC’s position across the natural gas value chain and provide a dedicated platform for gas trading activities in domestic and international markets.
Read also: ONGC Begins Commercial Crude Oil Production at Ashoknagar, Marking Major Milestone for Bengal Basin
ONGC to Double Deepwater Drilling Under Project DeepX
ONGC Chairman and Chief Executive Arun Kumar Singh said the company plans to double its deepwater drilling effort over the next two years.
Speaking at ONGC’s 33rd Annual General Meeting, Singh said the company will focus exploration on Category-II basins, No-Go areas and deepwater acreage, where the company expects potential for significant future discoveries.
The strategy is aligned with the government’s Samudra Manthan mission, which seeks to accelerate offshore exploration and production.
Under its internal Project DeepX, ONGC has mobilised a specialist taskforce and finalised plans to increase deepwater drilling activity.
During FY2025-26, ONGC:
- Drilled four exploratory wells in the ultra-deep waters of the Andaman Basin.
- Spudded AND-P-1, its first stratigraphic well under the government-sponsored initiative, on January 27.
- Started its first deepwater well in the Mahanadi Basin on July 25.
This marked the company’s expansion into a second frontier basin within six months.
ONGC Seeks Global Partnerships for Frontier Exploration
Singh said frontier exploration involves substantial risks and indicated that ONGC is seeking greater collaboration with global energy companies.
The company has stepped up engagement with international players for joint bidding and farm-in opportunities, which could help share exploration risks while bringing additional expertise and technology.
Singh also welcomed the recent amendment to the Oilfields (Regulation and Development) Act, which provides for fiscal stability, resource sharing and a faster dispute-resolution mechanism.
He described the amendment as a positive step towards revitalising exploration and production in India.
ONGC Invests Over ₹40,000 Crore in Western Offshore Fields
Alongside its frontier exploration push, ONGC is investing heavily in its ageing Western Offshore assets to maintain and improve production.
Projects worth more than ₹40,000 crore are currently under implementation across the Western Offshore fields.
The improvement programme covers:
- Reservoir and pressure management
- Enhanced water injection
- Pipeline replacement
- Other production-enhancement measures
ONGC expects the benefits of these interventions to progressively materialise from FY2027-28, supporting enhanced production and long-term value creation.
Mumbai High Redevelopment to Boost Oil and Gas Output
The Mumbai High field, which has been producing for around five decades, is at the centre of ONGC’s Western Offshore redevelopment strategy.
ONGC issued the Notice of Award for the Mumbai High Redevelopment Phase-1 Scheme on December 26, 2025.
UK-based energy company bp is providing technical services for the redevelopment programme. The project is expected to deliver cumulative incremental production of:
- 2.699 million metric tonnes (MMT) of oil
- 2.806 billion cubic metres (BCM) of natural gas
The incremental production is envisaged by March 2040.
bp has subsequently been onboarded as the technical services provider for ONGC’s entire Western Offshore portfolio, while ONGC will retain responsibility for its fields.
ONGC Production Remains Stable in FY26
Despite the natural decline in production from its principal fields, ONGC managed to keep production close to the previous year’s levels.
During FY2025-26, the company produced:
- 20.501 MMT of crude oil
- 19.966 BCM of natural gas
- 2.561 MMT of value-added products
The figures include ONGC’s share from joint ventures.
The company drilled 501 wells during the year, including 100 exploratory wells.
ONGC also notified three new hydrocarbon discoveries in its operated offshore acreage. Testing during the year established 55 wells as hydrocarbon-bearing, including wells drilled in earlier years.
The company acquired:
- 957 line kilometres of 2D seismic data
- 4,631 square kilometres of 3D seismic data
Across its Open Acreage Licensing Policy blocks, ONGC has cumulatively drilled 79 exploratory wells and made 13 discoveries, with Vajramani being the latest.
Reserve accretion from ONGC-operated areas stood at 44.01 million tonnes of oil equivalent (MMTOE) on a proved-plus-probable basis, resulting in a reserve replacement ratio of 1.17.
Gas Development Projects Gain Momentum
ONGC continued to advance its gas development and monetisation projects during FY26.
Gas production commenced from the Daman Upside Development Project in March.
The company also progressed the monetisation of:
- North Karanpura coal bed methane block
- Chinnewala discovered small field in Rajasthan
The proposed gas trading company could complement these initiatives by giving ONGC a larger role in the marketing and trading of natural gas.
ONGC Revenue and Profit Decline in FY2025-26
ONGC’s revenue from operations declined to ₹1,32,508 crore in FY2025-26 from ₹1,37,846 crore a year earlier, mainly due to lower crude oil realisations.
Profit after tax fell to ₹32,894 crore, compared with ₹35,610 crore in FY2024-25.
Other key financial indicators included:
- Debt-to-equity ratio: 0.02:1
- Return on capital employed: 22.46%
- Contribution to national exchequer: ₹55,865 crore
The board declared interim dividends of ₹6.00 and ₹6.25 per share and recommended a final dividend of ₹1 per share.
The total dividend payout stood at ₹16,669 crore, equivalent to around 51% of profit.
ONGC Capital Expenditure Stands at ₹61,131 Crore at Group Level
ONGC continued to maintain high capital expenditure to support its exploration, production and infrastructure plans.
Capital expenditure during FY26 stood at:
- ₹35,878 crore on a standalone basis
- ₹61,131 crore at the ONGC Group level
Two major projects were completed at a combined cost of ₹1,328 crore.
The company also approved 17 enhanced oil recovery pilot schemes aimed at improving recovery from existing fields.
ONGC Reports Record Standalone Quarterly Profit
The company began the current financial year with a strong standalone performance.
For the quarter ended June 2026, ONGC reported standalone net profit of ₹17,034 crore, more than double the corresponding period of the previous year.
Profit before tax stood at ₹22,848 crore, which Singh described as the highest quarterly profit recorded by ONGC.
However, stronger crude prices also put pressure on the group’s refining operations, resulting in subdued consolidated performance.
Singh said ONGC’s integrated structure helps the group absorb price movements across different segments of the energy business.
ONGC Videsh Expands International Oil and Gas Portfolio
ONGC’s overseas arm, ONGC Videsh, holds participating interests in 29 oil and gas projects across 14 countries.
Production from overseas assets during FY26 stood at 9.671 MMTOE, comprising:
- 6.908 MMT of crude oil
- 2.763 BCM of natural gas
The force majeure on the Area-1 Mozambique LNG project was lifted in November 2025, with the first cargo targeted for July 2028.
ONGC Videsh also formalised the acquisition of a 20% equity stake in Sakhalin-1 LLC on December 5, 2025, following engagement with Russia’s energy ministry.
The company has also received a specific licence from the US Office of Foreign Assets Control (OFAC) for continued operations in its Venezuelan assets.
HPCL and MRPL Report Strong Downstream Performance
ONGC’s downstream businesses also recorded notable performance during FY26.
Hindustan Petroleum Corporation Limited (HPCL) recorded:
- 26.04 MMT combined refining throughput
- More than 25,000 retail outlets
- ₹17,175 crore standalone profit after tax, compared with ₹7,365 crore a year earlier
Meanwhile, Mangalore Refinery and Petrochemicals Limited (MRPL) processed 16.774 MMT of crude.
Its gross refining margin improved to $9.22 per barrel, compared with $4.45 per barrel in the previous year.
MRPL reported standalone profit after tax of ₹1,931 crore.
ONGC Green Targets 10 GW Renewable Capacity by 2030
ONGC is expanding its renewable energy portfolio through ONGC Green.
The company’s renewable portfolio currently stands at 2.853 GW, against a target of 10 GW by 2030.
During FY26, ONGC awarded a 300 MW solar project connected to the inter-state transmission system for captive use. The corresponding wind tender was awarded on June 5.
The renewable expansion is part of ONGC’s broader strategy to diversify its energy portfolio while continuing to invest in its core oil and gas operations.
ONGC Cuts Emissions, Advances Carbon Capture Project
ONGC also reported progress on its decarbonisation initiatives.
Scope 1 and Scope 2 emissions declined by 7.26% to 8.81 million tonnes of carbon dioxide equivalent.
The company has set a net-zero target for Scope 1 and Scope 2 emissions by 2038.
ONGC is also advancing its first carbon capture and storage (CCS) pilot at the Gandhar field.
The project envisages injecting approximately 100 tonnes of carbon dioxide per day into depleted hydrocarbon reservoirs.
OPaL Turns Profitable After Capital Restructuring
ONGC Petro additions Limited (OPaL), now an ONGC subsidiary, recorded a significant turnaround during FY26.
Its EBITDA improved from a negative ₹203 crore to a positive ₹1,207 crore.
The improvement followed a capital restructuring that included an equity infusion of ₹18,365 crore and OPaL’s transition from a Special Economic Zone to the Domestic Tariff Area.
ONGC also formed two joint ventures with Japan’s Mitsui O.S.K. Lines:
- Bharat Ethane One
- Bharat Ethane Two IFSC Private Limited
The ventures are aimed at securing long-term ethane transportation for ONGC’s petrochemical operations.
Separately, the government has entrusted ONGC with developing an additional 1.75 MMT strategic petroleum reserve at Mangalore.
About ONGC
Oil and Natural Gas Corporation Limited (ONGC) is India’s largest oil and natural gas exploration and production company. A Maharatna Central Public Sector Enterprise under the Ministry of Petroleum and Natural Gas, ONGC is engaged in exploration, development and production of crude oil and natural gas in India and overseas. The company also has interests in refining, petrochemicals, renewable energy and other segments of the energy value chain.
Read also: ONGC Videsh Plans $200 Million Investment to Revive Venezuela’s San Cristobal Oilfield
