Oil and Natural Gas Corporation (ONGC) is set to begin importing ethane from mid-2028 to compensate for the altered composition of liquefied natural gas (LNG) imported from Qatar, as per a tender issued by the state-owned firm.
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India currently imports 7.5 million tonnes of LNG annually from Qatar. Under the existing deal, QatarEnergy supplies 5 million tonnes per year of LNG on a firm basis, containing methane (for electricity, fertiliser, and CNG production), ethane, and propane (used for LPG and petrochemicals). The remaining quantity is supplied on a best-effort basis.
However, this contract expires in 2028, and the revised agreement signed last year specifies that QatarEnergy will supply ‘lean’ gas, stripped of ethane and propane.
ONGC’s Ethane Import Strategy
ONGC has invested Rs. 1,500 crore in setting up a C2 (ethane) and C3 (propane) extraction plant at Dahej, Gujarat. The extracted ethane and propane are used as feedstock for ONGC Petro additions Ltd (OPaL), its petrochemical subsidiary. With the change in LNG composition, ONGC is now looking to import 800,000 tonnes per annum of ethane starting in May 2028.
To facilitate this import, ONGC is seeking joint venture partners to develop very large ethane carriers (VLECs) for transporting the ethane feedstock.
Key Tender Highlights:
- ONGC Petro additions Ltd (OPaL) operates Southeast Asia’s largest standalone dual-feed cracker, using a mix of naphtha, ethane (C2), propane (C3), and butane (C4) as feedstock.
- ONGC is looking for partners with expertise in the ownership, operation, and management of VLECs, VLGCs (Very Large Gas Carriers), or LNGCs (Liquefied Natural Gas Carriers) in the global market.
- ONGC will source and supply ethane, while the joint venture will handle VLEC procurement, financing, and shipyard selection.
- The deadline for submission of interest is March 27, 2025.
ONGC built the C2/C3 extraction unit in Dahej (Bharuch district, Gujarat) in 2008-09, while its subsidiary OPaL established the petrochemical plant in 2017. Until then, ONGC sold extracted C2-C3 compounds to Reliance Industries’ IPCL.
The C2/C3 extraction plant has a handling capacity of 4.9 million tonnes per annum (MTPA) of LNG. The OPaL facility includes a 1.1 MTPA ethylene dual-feed cracker, polymer plants, and associated units to produce HDPE, LLDPE, PP, and Styrene Butadiene Rubber.
This initiative will secure ONGC’s petrochemical feedstock supply and strengthen India’s petrochemical sector amid evolving global LNG trade dynamics.
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