ONGC to re-evaluate the option of refinery in Rajasthan

Rajasthan: Oil and Natural Gas Corporation (ONGC) has decided to re-evaluate the possibility of setting up a refinery in Rajasthan.

This is in response to the State Chief Minister, Mr Ashok Gehlot’s request to examine the viability of such a project in the context of the crude pipeline that is being commissioned by Cairn India and ONGC in a 70:30 partnership.

“We will examine the option of setting up a refinery and see if it is a viable proposition,” the Chairman and Managing Director of ONGC, Mr R.S. Sharma said.

According to top sources, revisiting the refinery plan is not going to make a difference this time around. For one thing, ONGC’s top priority is to focus on its core competence of exploration & production (E&P). Two, setting up a refinery would also mean investing in retail outlets, something which ONGC is not inclined to do right now, given that it has already frozen all marketing plans for Mangalore Refinery & Petrochemicals (MRPL), in which it has a 72 per cent share.

It remains to be seen, of course, whether Cairn India, the majority shareholder in the Rajasthan crude pipeline will contemplate teaming up with ONGC for a refinery. Thus far, it has only focused on E&P in India, which pretty much reflects its UK parent’s global priorities too.