The board of state-owned energy giant Oil and Natural Gas Corporation Ltd (ONGC) on Tuesday, July 22, approved a true-up amount of up to ₹5,082 crore that will be spent over FY26-27 by subsidiaries of ONGC Videsh involved in the Area 1 Mozambique LNG project, according to a stock exchange filing.
ONGC Videsh has 16% participating interest in Area 1 Mozambique project and it is managed through its stepdown companies – ONGC Videsh Rovuma (OVRL) and Beas Rovuma Energy Mozambique (BREML), the update said.
The company’s board has approved the receipt of the true-up amount, which is payment or adjustment made for estimated costs, of up to ₹5082.39 crore from the LNG project in Mozambique. In particular, BREML would incur ₹1,270.62 crore and ₹635.31 crore during 2025-26 and 2026-27, respectively, the company said.
ONGC Videsh Rovuma would incur a true-up amount of ₹2,117.61 crore and ₹1,058.85 crore during 2025-26 and 2026-27, respectively.
In April, the company initiated a postal ballot seeking shareholder approval for critical financial undertakings related to its operations in Mozambique. The company had planned to advance up to ₹1,500 crore from OVL to BREML, a joint venture subsidiary.
The Area 1 Mozambique Project, located in the Rovuma Basin, is a significant natural gas discovery with substantial potential. However, in the recent past, the Mozambique project has faced disruptions due to security concerns. ONGC is actively working towards restarting the project.
Separately, the majority of the analysts tracking the company in May projected up to a 50% upside on ONGC shares after the company reported its fourth quarter earnings. ONGC reported a net profit of ₹6,448 crore in the March quarter, which was below Street estimates of ₹8,804 crore, and down 22% from the previous quarter’s ₹8,240 crore.
Shares of ONGC closed marginally higher at ₹246.40 on BSE.
(Edited by : Shoma Bhattacharjee)
