InvestorQ : Why is ONGC being asked to sell a stake in Bombay High to global companies?
Rutuja Nigam made post

Why is ONGC being asked to sell a stake in Bombay High to global companies?

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4 weeks ago
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The Ministry of Petroleum has recently asked the Oil & Natural Gas Corporation or ONGC to look for global buyers for 60% stake as well as operating control in India's largest oil and gas producing fields, These highly lucrative fields are located in Bombay High off the coast of Mumbai as well as in Bassein. The ostensible idea is to help improve the performance of these wells, which have been stagnating for some time now.

It is true that productivity of the Mumbai High and Bassein have been very low for some time but that is also because the huge cash reserves of ONGC have been allocated to buying stakes to give an exit to the government. As a result, from being a cash rich company, ONGC has been a cash-starved company. Yields from Mumbai High have been falling and Ministry wants recovery to go up from 28% to 32%, but that is only part of the real problem.

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