ONGC plans another subsidiary

8220;We don8217;t want to dump the new company with assets,8221; Bora said, asked whether the subsidiary would be dependent on the parent for equipment. The idea is to segregate support services from ONGC8217;s core business of producing oil and to make money out of accumulated assets in the process.

The proposal will require the blessings of thereconstituted navratna board, which is now empowered to take decisions on joint ventures and investments. Bora felt that by the time the blueprint for the new company had received its finishing touches, the navratna package 8220;would be fully enforced8221;.

Hiving off services into a separate venture is part of ONGC8217;s business reorganisation process. At present nearly 68 per cent of ONGC8217;s Rs 13,335-crore revenue comes from oil production and the rest comes out of producing natural gas and LPG. Management consultants McKinsey and Company had recommended ONGC hive off some of its non-core businesses, like drilling, well logging, seismic data collection and well stimulation into subsidiaries.