The Oil and Natural Gas Corporation (ONGC) board is understood to have cleared the proposal for signing a Memorandum of Understanding (MoU) with Mitsui and Company of Japan for wide ranging cooperation in the gas and LNG business. The agreement, when formally inked, would pave the way for opportunities such as setting up a re-gasification terminal at Mangalore or any other mutually identified locations, including marketing of re-gasified LNG.
Highly placed sources in the Petroleum Ministry said the proposed MoU was cleared by the Board at its recent meeting and it would now be lined up for execution.
Sources, who knew of the development, said both ONGC and Mitsui would seek to collaborate on new LNG transportation technologies and gas demand creation in various areas including household LNG demand creation and gas-based plants. The joint partners would also look into specific exploration opportunities within India that could lead to joint bidding for identified acreage in forthcoming exploration rounds, such as NELP, shale gas blocks and any opportunity outside India in upstream blocks which are mutually identified and agreed.
Under the proposed agreement, both ONGC and Mitsui would also explore the possibility of laying, building, operating or expanding natural gas pipelines along mutually identified routes. The scope of cooperation would also include joint bidding for laying, building, operating or expanding natural gas pipelines along the route notified for bidding by the Petroleum and Natural Gas Regulatory board (PNRGB) and would include joint gas marketing arrangements.
To meet the demand for natural gas in India and specifically ONGC and Mitsui promoted joint ventures, both parties would make reasonable efforts to source LNG from international LNG suppliers on spot, short, mid and long term contract basis.
