ONGC on hotbed, touches new low on clarification over OALP-1 contracts; share down 15%, all details here

As usual, the Dalal Street continued for another bloodbath, as the benchmark Sensex and Nifty indexes traded on negative today ahead of RBI's bi-monthly monetary policy. Interestingly, it was the oil and gas sector which turned to be top losers, so much so, that few its major stocks even touched an all-time low, among which was largest oil distributor ONGC. The company has cracked a low of Rs 149.10 per piece resulting in overall decline of 15% on BSE. However, at around 1158 hours, the ONGC share price was trading at Rs  151.55 per piece low by Rs 23.25 which is 13.30%. 

Reason can be attributed to a clarification sought by stock exchanges in regards to a media report saying, 'Government signs OALP-1 contracts with Vedanta, ONGC'. The reply is awaited from ONGC. 

According to Economic Times, Oil Minister Dharmendra Pradhan said on Monday that "5,900 crore of investment has been committed in 55 oil and gas exploration areas awarded under India's maiden open acreage auction. 

Reportedly, mining mogul Anil Agarwal-led Vedanta Ltd walked off with 41 out of 55 oil and gas exploration blocks offered in OALP-1, contracts for which were signed at a function on 1st Oct. State-owned Oil India Ltd won nine blocks, while Oil and Natural Gas Corp managed to win just two. 

Further, it was known, as  many as 55 blocks were sought for prospecting of oil and gas by prospective bidders, mostly by state-owned explorers, ONGC and OIL India and Vedanta by the end of the first EoI cycle on November 15, 2017. These blocks were then offered for bidding and winners signed PSC on Monday. 

Vedanta CEO Sudhir Mathur also told ET, will invest USD 551 million in the 41 blocks it won under OALP-1. They had earlier bid for all 55 blocks. 

As for state-owned ones, reportedly it was known that,  on May 2, ONGC had bid for 37 blocks either on its own or in consortium with other state-owned firms. OIL bid for 22 blocks in a similar fashion. 

During the bidding, Vedanta was sole bidder for somewhat 2 blocks, and had faced stiff competition from ONGC or Oil India in remaining blocks.

Compared to other stocks Vedanta Limited had less affect on its share, currently it is trading at Rs 231.95 per piece low by 8.10 points which is 3.37%.