Mumbai: Two joint ventures of steel baron Lakshmi Niwas Mittal with ONGC Videsh Ltd are shutting shop, documents filed with the Registrar of Companies (RoC) show.
The joint venture partners are Mittal Investments Sarl, the private investment company of the Mittal family, and ONGC Videsh, the overseas exploration and production arm of state-run explorer Oil and Natural Gas Corp. Ltd (ONGC).
The first venture, ONGC Mittal Energy Ltd (OMEL), has ONGC Videsh holding 49.98% and Mittal Investments 48.02%. SBI Capital Markets holds the balance 2% stake.
The company was formed in 2006 to source equity oil and gas from abroad for securing India’s energy independence.
“The company had no operations for a long time and the board decided to discontinue the operations. It was decided by the board to strike off the name of the company from the register of companies. Accordingly, the financial statements have not been prepared on a going concern basis," said the company in its 11th annual report for the year to March 2017, filed with the RoC.
For the year ended March 2017, OMEL reported a loss of Rs166,623 against a loss of Rs127,000 for the year to March 2016. Closing balance of profit and loss account for 2017 stood at Rs500,000 against Rs333,377 for 2016, according to the report.
OMEL, through its Nigerian subsidiaries, held participating interests in three Nigerian exploration blocks—OPL-246, OPL-279 and OPL-285. It had also invested in a producing block in Syria.
OMEL had in November 2006 paid $100 million to win the OPL-246 block in Nigeria. It had paid a signature bonus of $50 million for OPL-285 and $75 million for OPL-279.
“The Nigerian blocks had been relinquished after unsuccessful exploration efforts and OMEL is shutting down its Nigerian operation and its associated subsidiaries," OMEL said in an emailed response.
OMEL added that the Syrian investment is presently affected by political unrest in Syria and the management is keeping track of the political situation in Syria.
“The operations in Syria may be resumed once the political and security situation improve in Syria," said OMEL.
The second venture, ONGC Mittal Energy Services Ltd, a wholly owned subsidiary of OMEL, was to be involved in trading and shipping of oil and gas (including LNG) sourced by OMEL from abroad.
OMEL in the emailed response added, “At present, this company does not have any operation and may be closed in due course."