LN Mittal, ONGC to ink pact

Cos will acquire stakes in overseas oil & gas blocks and energy-related biz.

In what is going to be one of India's pathfinding tie-ups, Oil and Natural Gas Corporation (ONGC) and steel major LN Mittal Group will sign an MoU tomorrow for cooperation across all sections of the petroleum sector.

This will happen after Mittal meets Petroleum Minister Mani Shankar Aiyar in the morning.

ONGC executives told reporters today that the two sides would be forming two joint ventures, concentrating on different regions, including Central Asia, where Mittals reportedly enjoyed a good standing.

The collaboration will primarily look for oil and gas exploration opportunities abroad besides partnership in the refining sector.

The new entities will have 51 per cent ownership by ONGC or by its overseas arm ONGC Videsh while the remaining will be held by the Mittals. The companies will acquire stakes in overseas oil and gas blocks and energy-related businesses.

"The joint venture will be registered outside India," said an ONGC executive.

Asked to detail the nature of business of the two proposed companies, the executive said one would focus on exploration and production.

Speaking to reporters after a meeting to give approval to the MoU, the petroleum minister said, "There will be two sets of MoUs which will be signed."

Asked about Prime Minister Manmohan Singh' s statement on Thursday on security concerns surrounding the Indo-Iran gas pipeline, Aiyar said all matters concerning the pipeline had safety and security dimensions built into it.

He said all measures would to be taken to have a safe and secure world class project.