Aker may submit report in Apr on ONGC-RIL tie-up prospect

Aker Solutions, appointed by state-owned ONGC to explore possibility of sharing Reliance Industries Ltd (RIL) infrastructural facilities on East coast of the country, is expected to submit its report by April next year. Based on Aker's report, ONGC will decide whether to enter into an agreement with RIL or not and modalities if it decides to go with the Mukesh Ambani-led company, according to Ashok Varma, Executive Director (Asset Manager) Eastern Offshore Asset.

"The agreement with RIL is valid for nine months. Aker is expected to give their report by April. After that we need to do the engineering of the entire thing we put up and float tenders," Varma told PTI. "Within nine months we have to finish studies. We are on schedule. They will do the complete analysis of their (RIL) system, our system, quantities of gas and whether we can process our production there or not," he said.

Also Read: RIL, BP to give $1.2 bn bank guarantee for higher gas price

In July, ONGC had inked a Memorandum of Understanding with RIL to explore the possibility of sharing the latter's infrastructural facility in the east coast. The MoU aims at working out the modalities for sharing of infrastructure, identifying additional requirements as well as firming up the commercial terms.

This shall not only minimise ONGC's initial Capex but also expedite its field development resulting in early monetisation of its deep water fields adjacent to the fields of RIL, ONGC had earlier said.

Aker Solutions provides oilfield products, systems and services for customers in the oil and gas industry worldwide. "If everything is well then we will start working with them from 2017," Varma added. ONGC has made nine gas discoveries in its KG block KG-DWN-98/2, which sits next to RIL's flagging KG-DWN-98/3 or

KG-D6 block. The state-owned firm plans to club these finds with discoveries in another neighbouring block to begin gas production from 2016-17, ONGC had earlier said.

ONGC stock price

On December 30, 2013, Oil and Natural Gas Corporation closed at Rs 289.25, down Rs 2.8, or 0.96 percent. The 52-week high of the share was Rs 354.10 and the 52-week low was Rs 234.40.

The company's trailing 12-month (TTM) EPS was at Rs 22.24 per share as per the quarter ended September 2013. The stock's price-to-earnings (P/E) ratio was 13.01. The latest book value of the company is Rs 145.47 per share. At current value, the price-to-book value of the company is 1.99.

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