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BSE: 500312ISIN: INE213A01029INDUSTRY: Oil Drilling And Exploration

BSE   ` 182.50   Open: 181.80   Today's Range 181.50
183.00
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212.90
Year End :2017-03 
Dear Shareholders, The, on behalf of the Board of Directors of your Company, am pleased to share with you the achievements and highlights of your Company during the financial year ended March 31, 2017 and to present the 24th Annual Report on the business and operations of Oil and Natural Gas Corporation Ltd. (ONGC) and its Audited Financial Statements with the Auditors' Report and Comments on the Accounts by the Comptroller and Auditor General (CAG) of India and the reply of the management thereto. The challenges that marked the macro environment, viz. low commodity prices, uncertain demand outlook and slow global economic recovery, in FY'16 persisted in FY'17 as well. Crude prices today are distinctly higher than they were in early 2016. However, it would be prudent for oil and gas companies to remain wary as the recovery has not been as robust and stable as one would have liked it to be. It is reflective of the larger economic environment of the world where secular growth has not returned to the markets post the global financial meltdown and the subsequent Eurozone slowdown. While this extended period of low commodity prices poses challenges for E&P companies in terms of ambitious exploratory efforts and development from difficult areas, it is a source of meaningful monetary comfort for an import dependent economy likes ours. That being said, price-related pressures are likely to ease going forward as companies learn to adapt and improvise in this 'new normal' of low prices. We must not forget that our industry has faced numerous challenges in the past and has always come out stronger each time. This 'new normal' will also be defined and influenced by the international political developments in the past one year and the remarkable growth (both in terms of investment as well as capacity addition) of renewable energy sources, adding a further layer of complexity to the operating environment of oil and gas. In this prevailing environment of increased volatility and uncertainty, it has become more important than ever for companies to sharpen their focus on promising growth avenues while consolidating their key areas of strength. For your Company, it meant a more aggressive approach to cost optimization and operational efficiencies in our legacy business and stepping up activity in the area of unmonetized discoveries with comprehensive planning and robust project management philosophy. Considering the critical importance of your Company in the country's overall energy infrastructure, the decisions and actions of today will, to a large extent, not only set the ground for a significant transformation that will enable it to contribute even more expansively to the country's energy sector but also ensure its competitiveness in any operating environment. Despite the challenges of the business and its surrounding environment, your Company along with its group companies has registered yet another year of strong performance and made substantial progress on most of these priority areas. In addition, performance in the other areas of business where your Company has significant interests also recorded important milestones. Backed by an intensive and continuous exploration programme, your Company made 23 oil and gas discoveries in various basins of India out of which eight discoveries have already been monetized. During the year, your Company produced 22.25 MMT ofoil against 22.37 MMT during FY'16. Natural gas production was at 22.09 BCM against 21.18 BCM during FY'16, thereby recording an increase of 4%. Your Company's share in domestic joint ventures' production has been 3.28 MMT of oil and 1.18 BCM of gas. Combining the two, total domestic production has been 25.53 MMT of oil and 23.27 BCM of gas. VAP production increased from 2.77 MMT in FY'16 to 3.24 MMT in FY'17 (increase of 17%) with contribution from C2-C3 and Hazira plants. All joint ventures of your Company established for value-chain integration i.e.,- ONGC Petro-additions Ltd. (OPaL), ONGC Teri Biotech Ltd. (OTBL), ONGC Tripura Power Company Ltd., (OTPC), Petronet MHB Ltd. (PMHBL), Dahej SEZ Ltd. (DSEZ) and Mangalore SEZ Ltd. (MSEZ) are now operational and have started generating revenue. The significant milestones achieved by your Company during 2016-17: - Your Company made 23 Oil and Gas discoveries out of which 13 were Onshore and 10 were Offshore. 4 of these discoveries are in New Exploration and Licencing Policy (NELP) blocks. Focusing on quick monetization, 8 of these discoveries have already been put to production. - With these 23 discoveries, your Company accreted 64.32 MMtoe of 2P reserves in the domestic fields. RRR with 2P reserves during the year has been 1.45. - With Jabera discovery, Vindhayan Basin has made entry into the oil reserves map of India. - With recent discoveries in Kutch offshore, focus is on bringing this new basin on production. - Your Company has taken up development of KG-DWN-98/2 block in Krishna-Godavari (KG) Basin with an investment of more than US$ 5,000 million (approx. Rs.340,000 million). Peak oil from the field is around 78,000 bpd and gas @ 15.57 MMSCMD. - Gas production commenced from S1 Deep Water field (water depth around 280M) in KG Basin @ 0.9 MMSCMD and the first Deep Water gas well to fetch a price of US$ 5.05 per MMBTU under government approved pricing and market freedom policy. - Gas sales increased from 16.08 BCM in FY'16 to 17.06 BCM in FY'17; an increase of 5.80 %. - Your Company deployed 35 rigs in offshore, the highest ever and drilled 501 wells again the highest ever (401 development wells, the highest ever). Commercial speed during the year has been 1,472; an increase of more than 24% compared to 2015-16. - Testing the efficacy of B-90 culture in the wells of Becharaji field Microbial Enhanced Oil Recovery (MEOR) job was carried out in 3 wells of Bechraji in 2016-17. - Gas flaring during the year has been 529 MMSCM which reduced from 3.06% (FY'16) to 2.40% (FY'17); a reduction of21.6% over the previous year. - Additional development of Vasai (East): facility creation (2 well platforms and Subsea pipeline) completed. 12 wells out of 20 wells drilled and added additional oil production of 7000 BOPD. - Besides 28 ongoing oil and gas development projects, 6 development projects worth Rs.76,700 million have been taken up during FY'17. The projects are NW B-173A, B -147, BSE-11, 4th phase of NBP Field and R-Series and redevelopment of Santhal field. - Your Company signed Farm-in/Farm-out (FIFO) agreement with GSPC on 10th March, 2017 to acquire 80% PI with operatorship in block KG-OSN-2001/3. - Commencement of Coal Bed Methane (CBM) field development operations in Bokaro and North Karanpura. - Gross Revenue of the Company stood at Rs.779,078 million and for ONGC Group it has been Rs.1,421,490 million. - Your Company recorded a Net Profit of Rs.179, 000 million during the year under review. Net Profit of ONGC Group increased by 59% to Rs.204, 979 million (Rs.128, 752 million in FY'16). - ONGC Videsh Limited (OVL), a wholly owned subsidiary of your Company, registered highest-ever production of 12.80 MMtoe of O+OEG during the year. It recorded Gross Revenue of '100,800 million and Net Profit of Rs.6,974 million (against loss of Rs.36,401 million in FY'16). - Mangalore Refinery and Petrochemicals Limited (MRPL), a subsidiary of your Company, recorded highest-ever throughput of 16.27 MMT during FY'17. - MRPL recorded 17% increase in Turnover to Rs.599,801 million (Rs.509, 623 million during FY'16) and highest ever Net Profit of Rs.32,932 million (Rs.5,058 million in FY'16). - ONGC Tripura Power Company Ltd. (OTPC) clocked highest-ever Annual Gross Generation of 4,170 million units. - Six ONGC team members successfully accomplished Mission Everest. This is first time that a Corporate has taken a Mission to send its team to mount the highest peak of the Earth. These achievements reflect your Company's proven commitment towards sustained growth and performance excellence. Consistently driven by well-defined growth strategies, your Company delivers and improves performance year-on-year basis which is the benchmark of excellence in various facets of E&P activities and has also been well recognized through peer-and-public evaluations. Global Recognitions Your Company has been ranked number one E&P Company in the world by Platts Top 250 Global Energy Company Rankings-2016 and 20th among global energy majors based on assets, revenues, profits and Return on Invested Capital. The leading international business journal Forbes has ranked ONGC the 3rd largest in India and 220th worldwide based on sales, profit, assets and market value. Your Company has strengthened its brand position in India, climbing from 10th position during previous year to 7th position, according to a study conducted by consultant Brand Finance. Further, the Rs.2016 EU Industrial R&D Scoreboard' listed your Company at the 12th position in the list of oil and gas companies based on Research and Development (R&D) expenditure. Performance 2016-17 During FY'17, your Company made 23 Oil & Gas discoveries out of which 13 were Onland and 10 were Offshore including 4 discoveries in the blocks awarded under NELP. All these 23 discoveries are healthy pointers to the continued performance of the Company's exploratory efforts. Details of these discoveries are tabulated as below: Sl. No. Well No. Basin/Sub-basin Hydrocarbon Type Pool/ Prospect NELP/ Nomination 1 KGS092NA-SRI-1/SRI-AA Krishna Godavari (KG Offshore-SW) Basin Oil & Gas Prospect NELP 2 B-34-2/B-34-B Mumbai Offshore Basin Oil & Gas Prospect PML 3 Suphayam-2/S UA A Assam Shelf Basin Oil & Gas Prospect PEL 4 Jabera-4/RJBF Vindhyan Basin Gas Prospect PML 5 Dayalpur-1/SUAB Assam Shelf Basin Oil & Gas Prospect PML 6 B-157N-1/B-157N-A Mumbai Offshore Basin Oil & Gas Prospect PML 7 GS-71-1/GS-71-AA Krishna Godavari (KG Offshore-SW) Basin Oil & Gas Prospect PML 8 B-154N-1/B-154N-A Mumbai Offshore Basin Oil & Gas Prospect PML 9 South Akholjuni/Akholjuni-29/ AKAP Cambay Onland Basin Oil & Gas Prospect PML 10 D-30-2/ D-30-A Mumbai Offshore Basin Oil & Gas Prospect PML 11 G-1-N-2 / G-1-N-AB Krishna Godavari (KG Offshore-SW) Basin Oil & Gas Prospect PML 12 GKS101NCA-1/GKS101NCA-A Kutch Offshore Basin Oil & Gas Prospect NELP 13 MBS051NAA-2/NAA-B Saurashtra Offshore Basin Gas & Condensate Pool NELP 14 Dahej/Dahej-20/DJAT Cambay Onland Basin Gas Pool PML 15 Nambar/Nambar-12/NRAF Assam Shelf Basin Gas Pool PML 16 Nadiad/ Nadiad-4/NDDA Cambay Onland Basin Oil Pool PML (NELP) 17 Kesanapalli / Kesanapalli West Deep -1 /KWD-AA Krishna Godavari Onland Basin Oil & Gas Pool PML 18 West Penugonda/ Thurupu Vipparu-1 / TVAA Krishna Godavari Onland Basin Gas Pool PML 19 B-12C / B-12C-2 / B-12C-A Mumbai Offshore Basin Gas & Condensate Pool PML 20 Geleki / G-390 / GKHX Assam Shelf Basin, Oil Pool PML 21 Khoraghat / Khoraghat-38 Z / KHBB_Z Assam Shelf Basin Oil & Gas Pool PML 22 Olpad/Olpad-47/OPAM Cambay Onland Basin Gas Pool PML 23 Gandhar-724(GGAM) Cambay Onland Basin Oil Pool PML The significant discoveries are - Kesanapalli West (KG Basin), Suphayam and Dayalpur (Upper Assam). Supahyan and Dayalpur have opened up new exploration targets by establishing multilayered hydrocarbon occurrence. With Jabera discovery, your Company brought Bindhayan Basin onto the oil reserve map of India. With these 23 discoveries, your Company accreted 64.32 MMtoe of 2P reserves in the domestic fields. Discoveries put on production Dahej-20, Gujarat Suphayam-2, Jorhat Akholjuni-29, Gujarat Dayalpu r-1, Jorhat Gandhar-724, Gujarat Geleki-390, Assam Nambar-12, Jorhat Kesanapalli-West, AP In KG Offshore, two new oil finds, each one in shallow water (GS-71) and deep water (G-1-N) have produced much encouraging results during initial production testing. 8 out of 13 onshore discoveries have already been put on production during FY'17 itself. The ultimate reserve of 8 monetized discoveries is 3.4 MMtoe and has production potential of 0.218 MMtoe of O+OEG per year. Re-assessment of Hydrocarbon Resources Government of India (GoI) initiative for "Re-assessment of Hydrocarbon Resources" in Indian sedimentary basins has been undertaken by your Company. About 100 geoscientists of ONGC, in 12 working teams, are on the job. These studies are ongoing in 26 different basins -onshore, shallow water, deepwater. The project is expected to be completed by Nov'17. National Seismic Programme Your Company has been actively associated with National Seismic Programme (NSP), initiated by Government of India under which 48% of unappraised sedimentary in onland area is being covered through seismic survey. Out of proposed acquisition, processing and interpretation (API) of 48,243 LKM of onland data, your Company will be taking up API of 40,835 LKM in all states other than North East (NE). Details of discoveries in NELP blocks (since inception till 01.04.2017) Out of the 114 NELP blocks awarded to/acquired by your Company, as the operator, 32 blocks are operated presently and the remaining 82 blocks are relinquished so far. Exploration/ appraisal programme is under way in all the active blocks. As on 01.04.2017, your Company has a total of 64 discoveries, out of these, 58 discoveries (18 in deep water, 21 in shallow water and 19 in onland areas) are in 25 NELP blocks and the remaining 6 discoveries (4 deep water, 2 onland) fall under two blocks acquired from other operators. Commencement of production from these discoveries is governed by stipulation laid down in the respective Production Sharing Contracts (PSCs) and will be taken up after successful completion ofappraisal programme followed by submission of Declaration of Commerciality (DoC) and approval of Field Development Plan (FDP) by Directorate of Hydro Carbon (DHC). Reserve accretion & Reserve Replacement Ratio (RRR) During the year, accretion to in-place Hydrocarbons (3P-Proved, Probable and Possible), from the Company operated fields in India, has been 203.24 million metric tonnes (MMT) of Oil and Oil equivalent Gas (O+OEG), out ofwhich about 87 percent accretion has been due to exploratory efforts. Reserve Replacement Ratio (RRR) during the year has been 1.45. Total in-place reserve accretion during 2016-17 in domestic basins, including the Company's share in PSC JVs, stands at 210.61 MMtoe (7.37 MMtoe from JVs). As on 01.04.2017, total in-place hydrocarbon volume of ONGC group stands at 9,655.36 MMtoe against 9,444.74 MMtoe as on 01.04.2016. The ultimate reserves (3P) have been estimated at 3,132.35 MMtoe as against 3,075.51 during the FY'16. Voluntary disclosures in respect of Oil & Gas Reserves, conforming to SPE classification 1994 and US Financial Accounting Standards Board (FASB-69) have been followed in your Company. The following table gives the details of reserve accretion (2P-Proved and Probable) for the last 5 years in domestic basins as well as from the overseas assets: Ultimate Reserve (2P) accretion O+OEG (in MMtoe) Year Domestic Assets (1) ONGC's share in domestic JVs (2) Total Domestic (3)=(l)+(2) ONGC Videsh's Share in Foreign Assets (4) Total (5)=(3)+(4) 2012-13 67.59 4.23 71.82 10.09 81.91 2013-14 56.26 4.29 60.55 213.24 273.79 2014-15 61.06 -1.03 60.03 20.03 80.06 2015-16 65.58 0.80 66.38 -7.22 59.16 2016-17 64.32 0.22 64.54 120.28 184.82 Note: Reserve accretion reported in terms of 2P reserves Statement of Reserve Recognition Accounting (RRA) Reserve Recognition Accounting (RRA) is a voluntary disclosure towards recognizing income at the point of discovery of reserves and seeks to demonstrate the intrinsic strength of an organization engaged in exploration and production of hydrocarbons with reference to its future earning capacity in terms of current prices for income as well as expenditure. This information is based on the estimated net proved reserves (developed and undeveloped) as determined by the Reserves Estimates Committee of the Company. As per FASB-69 on disclosure about Oil and Gas producing activities, publicly traded enterprises in USA that have significant Oil and Gas producing activities, are to disclose with complete set of annual financial statements, the following supplemental information: a) Proved Oil and Gas reserve quantities b) Capitalized costs relating to Oil and Gas producing activities c) Cost incurred for property acquisition, exploration and development activities d) Results of operations for Oil and Gas producing activities e) A standardized measure of discounted future net cash flows relating to proved Oil and Gas reserves quantities Your Company has disclosed information in respect of (a) to (d) above in the Annual Financial Statements. Your Company has also made voluntary disclosure on standardized measure of discounted future net cash flows relating to proved oil and gas reserves at Annexure-A' to this report as statement of RRA. Oil & Gas Production On standlone basis, in FY'17 the Company's domestic crude oil production level registered at 22.25 MMT against 22.37 MMT in FY'16. Oil production from onshore assets increased by 2.4% while offhore registered a decline of 1.6%. Increase in onshore oil production has been mainly due to various initiatives and early monetization of discoveries in Ankleshwar, Cauvery (Madnam) and Rajahmundry (Keshnapalli West), etc. Domestic PSC JVs contributed 3.31 MMT of oil against 3.56 during FY'16. Natural gas production (from domestic operated fields) during FY'17 has been 4% higher than the previous year (22.09 BCM against 21.18 during FY'16). The Company's onshore gas production increased by healthy 9.1% where as offshore production increased by 2.9%. Onshore gas production increased mainly due to commissioning of GDUs in Rajahmundry, drilling of development wells and commissiong of Sonamura GCS in Tripura and GS-4 well in Gandhar. Incremental gas production in offshore was contributed by C-26 cluster/Daman fields in Western Offshore and Deep Water well S2AB in Eastern Offshore. Further most ofAssets registered increase in gas production during the year. Your Company's share in oil and gas production from PSC JVs has been 3.29 MMT and 1.18 BCM respectively. Oil & Gas production of ONGC Group, including PSC-JVs and from overseas assets for FY'17 has been 61.60 MMtoe (against 57.38 MMtoe during FY'16); an increase of 7.4%. Out of the total production of 33.96 MMT of crude oil, 65.5 per cent production came from the Company operated domestic fields, 24.8 per cent from the overseas assets and balance 9.7 per cent from domestic joint ventures. As far as natural gas production is concerned, majority of production (79.9 per cent) came from the Company operated domestic fields, 15.8 per cent from overseas assets and 4.3 per cent from domestic joint ventures. Unit Production Qty Sales Qty Value (Rs. in millions) FY'17 FY'16 FY'17 FY'16 FY'17 FY'16 Direct Crude Oil (MMT) 25.53 25.93 23.86 24.15 548,036 511,316 Natural Gas (BCM) 23.27 22.53 17.94 17.10 139,398 182,239 Ethane/Propane 000 MT 420 375 420 375 8,557 8,945 Propane 000 MT 90 29 87 26 2,223 496 Ethane 000 MT 137 - 135 - 5,354 - Butane 000 MT 31 - 30 - 1,131 - LPG 000 MT 1355 1195 1352 1191 37,276 34,951 Naphtha 000 MT 1101 1043 1087 1065 30,455 30,609 SKO 000 MT 36 67 42 66 1,321 2,118 Others 1,113 894 Sub Total 774,864 771,568 Trading Motor Spirit 000 KL 0.21 0.68 11 35 HSD 000 KL 0.43 1.16 20 49 Sub Total 31 84 Total 774,895 771,652

Production from Overseas Assets During the year total production from overseas assets has been 12.80 MMtoe of O+OEG (Oil: 8.43 MMT; Gas 4.37 BCM) against 8.92 MMtoe during FY'16; an increase of 43% mainly due to incremental production from Sakhalin-1 (Russia) and additional production on account of acquiring 26% share acquisition in Vankorneft. Russia (56%), Vietnam (12%), Azerbaijan (7%), and Myanmar (7%) contribute 82% of equity oil and gas followed by Brazil (5%), Venezuela (4.9%), Colombia (4.3%) and Sudan (3.8%). Technology Induction/Upgradation Your Company gives utmost importance for induction and upgradation of technology in various areas of its operations to remain competitive. During the year the following technology were inducted: - Suitable polymer squeezing technology to arrest sudden rise in water cut in North Kadi field of Mehsana Asset - Job execution in 8 No. ofwells done - Deep Penetrating Retarded Acid System (DPRAS) & Self Diverting Acid Stimulation technology for wells of NBP & other fields of Mumbai Offshore -job execution in 30 No. of wells done - Technology for deliquification for reviving production from gas wells of Ahmedabad Asset. The same is implemented in 2 No. of wells - Resource optimization through Batch Drilling in Offshore & Pad Drilling in onshore - Under Balanced Drilling - Technology penetration in onshore drilling at par with offshore - Use of Advanced Hybrid bits Exploration of different hydrocarbon (a) Basement Exploration: Concerted efforts for Basement Exploration, a frontier exploration play, have been taken up by the Company as a major initiative. The prospects achieved success in Mumbai Offshore, Kutch offshore, Cambay, Cauvery and A&AA Basin have further enhanced the scope of basement exploration. During the year, Basement fracture modeling and prospectivity analysis are also in progress in Assam & Arakan, Cauvery and KG and Kutch Offshore and West of Mumbai High Area of Western Offshore basins. Fracture model developed for Madnam field has been validated by Production Logging Tool (PLT) logs recorded in well MD-3 Sub and MD-7. Further, 7 exploratory wells and 8 development wells were drilled in different basins for basement prospect. In A&AA Basin, exploratory well SU-3 flowed 3.5-7.2 m3/day oil with 11000 m3/day gas from basement during production testing. B-121-8 in Western Offshore Basin flowed oil @200 Barrels/day through %" choke, well BH-75 gave oil indications from basement during testing and another well N-24-5 in Mumbai High Field flowed oil at 190 barrels/day from Basaltic Basement. In Cauvery basin development well MD-3 Sidetrack, MD-7, MD-8 and MD-9 have flown oil from basement. In Madnam field cumulative oil gain is around 300 m3/day from basement. For the development of discoveries in basement play, FDP approval has been obtained for Madanam Field and plan is under implementation. PML of Madanam field has been granted by GoI and grant from state government is awaited. FDP of Pandanallur Field, which also has basement play, has been submitted to DGH for approval. (b) Exploration in HP-HT & Tight Reservoir: Fields/Reservoirs with a sub-surface pressure of more than 10,000 psi and temperature of more than 350øF are classified as HP-HT reservoirs. The Company has prioritized HP-HT/Tight/Deeper plays in KG, Cauvery, Western Offshore Basin and Assam & Arakan Fold belt where such environment have been encountered during exploration for deeper pays. These plays have been an exploration challenge for drilling as well as for testing. In addition, your Company after acquiring the operatorship of NELP block KG-ONN-2003/1 has submitted the FDP of two discoveries made in the block. Further, hiring desired technological support/ services from domain consultants and service providers are explored to maximize established/potential for monetization. An action plan has been prepared for monetization of 3 HPHT Fields - Nagayalanka, Periyakudi and Bantumilli South and first production from these efforts is likely to commence in 2017. Unconventional & Alternate sources of energy Your Company plans to continue its endeavor for exploration and development of unconventional like - Shale (CBM) etc. and alternate sources of energy. Necessary action plan is being worked out for exploration and exploitation of Non-Conventional and Alternate Sources of energy which has been perceived as the future sources of energy. The initiatives towards this are summarized below: (a) Shale Gas/Oil Exploration: Exploration for assessing the Shale gas/oil prospectivity has been initiated in 4 basins of the country viz., Cambay, KG, Cauvery and A&AA Basins as per the policy guidelines notified by Government of India (GoI) for exploration and exploitation of shale gas and oil by National Oil Companies (NOCs), your Company has identified 50 nomination PML (Petroleum Mining Lease) blocks under Phase-I. As on 31.03.2017, 22 assessment wells (5 exclusive shale gas in Cambay basin and 17 dual objective wells) in 19 PML blocks have been drilled and required data are being generated/ evaluated for Shale gas/oil assessment. During the year, 4 dual objective wells in Cambay basin have been drilled. Laboratory studies of core and cutting samples collected in wells during the current year are in different stages of completion. A second zone in well JMSGA (JM#55) (instead of well number field/block may be mentioned) has also been hydro-fractured (HF) and indication of oil was observed during post-HF activation. Cumulative oil knocked out till 21.03.2017 was 2.35 m3. The well has been put on Gas Lift Value (GLV) for effective activation. Earlier, the well cumulatively flowed 19 m3 of oil with gas and about 173 m3 of flow back water from first zone. (b) Coal Bed Methane (CBM): The Government of India awarded total 33 blocks to various operators through four rounds of bidding and nomination. Out of these, your Company was awarded 9 CBM Blocks. Due to poor CBM potential, concluded on the basis of data generated in the exploratory activities, five blocks viz. Satpura (Madhya Pradesh), Wardha (Maharashtra), Barmer-Sanchor (Rajasthan), North Karanpura (West) and South Karanpura ( Jharkhand) have been relinquished. (c) Gas Hydrate Exploration: Your Company has been an active participant in the National Gas Hydrate Programmes (NGHPs). Towards this, Gas Hydrate Research & Technology Centre (GHRTC) was established on 14th September, 2016 at Panvel. The Centre would give impetus to the Gas Hydrate research & technology development and contribute to GOI's plan to commercialize Gas Hydrates as energy resource at the earliest. (d) Alternate sources of energy For harnessing alternate sources of energy, your Company took structured initiatives. - The contract for installation of a 10 MW Solar Plant at Hazira was awarded in 2016-17. The Notification of Award (NOA) was placed on 23.02.17 with scheduled completion period as seven months from NOA - One 40 KW Roof Top Solar Power plant at KV Hazira was commissioned in 2016-17(06.03.17). Another three 20 KW Roof Top Solar Power plants were installed in Ahmedabad at IRS, Logging Section and Fire Station in December 2016. Oil & Gas Projects (a) Projects completed during FY'17 Sl. No. Name of the Projects Completion/ Commencement of Production Total Investment (Rs. in Million) Envisaged Oil & Gas Gain 1. Additional Development of Vasai East May, 2016 24,768 1.827 MMT of oil and 1.971 BCM of gas by 2029-30 2. Improved Oil Recovery of B-173A Field December, 2016 3,525 0.567 MMT of oil and 0.071 BCM of gas by 2025-26 3. Reconstruction of BPA & BPB Platforms March, 2017 11,385 - 4. Construction of 6 ETPs, Five at Ahmedabad and One at Ankleshwar March, 2017 3,176.4 - Total 42,854.4 (b) Projects initiated during FY'17 The following 6 development projects were taken up. Sl. No. Name of the Projects Estimated Cost (Rs. in Million) Incremental Oil & Gas Gain 1. NW B-173A Development Plan for Exploitation of Mukta pay - NW B-173A Field 4741.5 0.760 MMT of oil and 0.213 BCM of gas respectively by the year 2031-32. 2. 4th Phase Development of NBP field 9,686.1 2.08 MMT of oil by the year 2031-32. 3. Development of BSE-11 Block 5,113.0 0.20 MMT of oil, 0.37 MMT of condensate and 0.568 BCM of gas by 2030-31 4. Development of B-147 field 5,461.5 0.489 MMT of oil and 0.708 BCM of gas by year 2029-30 5. Development of R-series fields including revival of R-12 (Ratna) 40,068.3 7.03 MMT of oil and 0.881 BCM of gas by the year 2035-36 6. Redevelopment of Santhal field 11,625.6 3.44 MMT by the year 2029-30 Total 76,696.0 (c) Implementation of IOR/Redevelopment Schemes To arrest the decline and improve recovery factor from mature fields, your company has successfully implemented several IOR schemes to sustain/augment oil & gas production from major offshore producing fields -Mumbai High, Heera & Neelam since year 2000-01. To further improve the recovery from the matured fields, three major IOR Projects were initiated during the FY' 14-15 and 15-16 and are as under: - Two IOR Projects were initiated in FY 15 viz. "Mumbai High North Redevelopment Phase-III Project with an investment of Rs.58,132.5 Milliion envisaging 6.997 MMT of oil and 5.253 BCM of gas by 2030 and Mumbai High South Redevelopment Phase-III Project with an investment of Rs.60688 Million envisaging 7.547 MMT oil and 3.864 BCM gas by 2030. Production has commenced on both the above projects. - One IOR projects was initiated in FY 1516 i.e. "Neelam Redevelopment Plan for Exploitation of Bassein and Mukta pay of Neelam field" with an investment of Rs.28188.8 Million. The project envisages incremental production of 2.76 MMT of oil and 4.786 BCM of gas by year 2034-35. (d) Fast track monetization ofMarginal Fields Your Company is developing new and marginal fields in fast track to augment the oil and gas production. It is pertinent to mention here that many marginal fields in western offshore which were not techno-economically viable for exploitation earlier on standalone basis are now being developed with cluster concept. Some of the marginal fields put on production in the last few years include NBP (D-1) with its additional development/ development of lower Pays, Vasai West, Vasai East with its additional development, North Tapti, BHE , SB-14, B-46 Cluster fields, C-24 cluster fields, B-22 Cluster fields, B-193 cluster fields, Cluster-7 fields and WO-16 cluster fields. In addition, production has commenced from "Development ofC-26 Cluster Fields" and "Daman Development" projects in 2016-17 and would contribute further with drilling of more wells under these projects. Monetization of marginal fields under B-127 cluster is under implementation and would contribute in the coming years. (e) Development of fields in Eastern Offshore Major thrust is being given to develop discoveries made in the Krishna Godavari basin which is a promising basin with various discoveries like G1/GS-15, Vasishtha, S1, GS-29 and KG-DWN-98/2, etc. Presently "Integrated Development of Vasistha & S-1 Fields" is under implementation and is aimed to contribute 15.95 BCM of gas by year 2026. The production has commenced from deep water well S2AB under this project from May 2016 utilizing the existing G1 field facilities and remaining wells are under drilling and would contribute in coming years. Further, to boost up oil and gas production from Eastern Offshore, one mega project for development of cluster 2 fields of NELP Block KG-DWN-98/2 was initiated in March 2016. The project is under implementation and envisages production of 23.526 MMT of oil and 50.7 BCM of gas by 2034-35. Development of other discoveries in KG offshore such as KG-DWN-98/2 (Cluster-I & III fields), GS-49 and GS-29, G-4-6 fields, shallow water NELP block KG-OSN-2004/1, etc. are under various stages of appraisal/approval for development. In addition to above initiatives, after the decision of Government of India to revert Ratna and R-Series fields in Western Offshore to the Company, Project "Development of R-series fields including revival of R-12 (Ratna)" has recently been initiated, which envisages incremental production of 7.03 MMt of oil and 0.881 BCM of gas by the year 2035-36. 1. Financial Results The Ministry of Corporate Affairs (MCA), vide its notification in its official gazette dated 16th February 2015, notified Indian Accounting Standards (Ind AS) applicable to certain class of Companies. Ind AS has replaced the existing Indian GAAP prescribed under section 133 of the Companies Act, 2013 read with Rule 7 of the Companies Accounts Rules, 2014. For ONGC, your company, Ind AS is applicable from April 1, 2016 with a transition date of April 1, 2015 and IGAAP as its previous GAAP. The following are the areas which had an impact on account of transition to Ind AS: - Fair valuation of certain financial instruments - Discounting of certain long term provisions like decommissioning provision - Valuation of loans by Effective Interest rate method - Accounting for proposed dividend - Deferred tax on the above adjustments - Valuation of equity instruments through other Comprehensive income The reconciliations and descriptions of the effect of the transition from IGAAP to Ind AS have been provided in notes to account at note 56 in the Standalone Financial Statements. Despite volatility in the crude oil prices and reduction in natural gas prices during 2016-17, your Company has registered Gross revenue of Rs.779,078 million and earned a Profit After Tax (PAT) of Rs.179,000 million, up by 10.91% over FY'16 (Rs.161,399 million). (Rs. in million) Particulars 2016-17 2015-16 Revenue from Operations 779,078 777,417 Other Income 75,481 70,094 Total Revenues 854,559 847,511 Profit Before Interest Depreciation & Tax (PBIDT) 386,266 392,495 Profit Before Tax (PBT) 252,155 235,988 Profit After Tax (PAT) 179,000 161,399 Pursuant to first proviso to sub-section (3) of section 129 read with rule 5 of the Companies (Accounts) Rules, 2014, a separate statement containing the salient features of the financial statement of its subsidiaries, associate company and joint venture in Form AOC-1, is appended to this report, which shall form part of the Financial Statements. 2. Dividend Your company paid first interim dividend of Rs.4.50 per share of Rs.5 each (90%) which was pre-bonus. Second interim dividend of Rs.2.25 per share (45%) was post- bonus. The Board of Directors have recommended a final dividend of Rs.0.80 per share (16%) post bonus. This makes the aggregate dividend at Rs.9.075 per share (181.5%) before considering bonus as compared to 170% paid in 2015-16. The total dividend for 2016-17 will be Rs.77,641 million, besides Rs.15,789 million as tax on dividend amounting to 52.20% of PAT (inclusive of dividend tax). There was delay in remittance of unpaid dividend aggregating Rs.13.79 million to Invest Education and Protection Fund due to technical reasons which was beyond the control of the Company. 3. Management Discussion and Analysis Report As per the terms of regulations 34(2) (e) of the SEBI Listing Regulations, the Management Discussion and Analysis Report (MDAR) forms part of the Annual Report of the Company. 4. Financial Accounting The Financial Statements have been prepared in compliance with Indian Accounting Standards Ind-AS issued by The Institute of Chartered Accountants of India (ICAI) effective from 01.04.2016 and provisions of the Companies Act, 2013. Further, as per Ministry of Corporate Affairs (MCA) notification, the financial statements have been prepared as per the format prescribed under the Schedule III to the Companies Act, 2013. Loans, Guarantees or Investments Your Company is engaged in Exploration & Production (E&P) business which is covered under the exemption provided under section 186(11) of the Companies Act, 2013. Accordingly, the details of loans given, investment made or guarantee or security given by the company to subsidiaries and associates are not required to be reported. Related Party Transaction Particulars of contracts or arrangements with related parties referred to in section 188 of the Companies Act, 2013, under Form AO C-2, are placed in Annexure-B. 5. Subsidiaries (I) ONGC Videsh Limited ONGC Videsh, the wholly-owned subsidiary of your Company for E&P activities outside India, has participation in 38 projects in 17 countries viz. Vietnam (2 projects), Russia (3 projects), Sudan (2 projects), South Sudan (2 projects), Iran (1 project), Iraq (1 project), Libya (1 project), Myanmar (6 projects), Syria (2 projects), Brazil (2 projects), Colombia (7 projects), Venezuela (2 projects), Kazakhstan (1 project), Azerbaijan (2 projects), Mozambique (1 Project), Bangladesh (2 Projects) and New Zealand (1 Project). Out of 38 projects, 14 are producing, 4 are discovered/ under development, 16 are exploratory and 4 are pipeline projects. ONGC Videsh's share of oil and oil equivalent gas (O+OEG) production, was 12.803 MMtoe during FY'17 as compared to 8.916 MMtoe during FY'16 (43.60% higher). The oil production has increased from 5.510 MMT during FY'16 to 8.434 MMT during FY'17 (53.1% higher) and the gas production increased from 3.406 BCM during FY'16 to 4.369 BCM during FY'17 (28.3% higher). During FY'17, the Company has earned net profit after tax of Rs.6,974 Million as compared to a net loss of Rs.36,401 Million during FY'16. The increase in profit is mainly on account of higher production, higher crude oil prices and lower impairment provisions. (a) Significant Acquisitions, Alliances and Operational highlights of ONGC Videsh during FY'17: ONGC Videsh successfully completed acquisition of 15% interest in Vankor Field located in East Siberia of the Russian Federation on 31st May, 2016 from Rosneft Oil Company and subsequently acquired additional 11% interest on 28th October, 2016. Vankor is Russia's second largest field by production and accounts for about 4% of Russian crude oil production. The daily oil production from the field is around 400,000 bopd on an average and ONGC Videsh's share considering both the acquisitions is about 104,000 bopd. Financing arrangements for above Acquisition: - ONGC Videsh Vankorneft Pte. Ltd., a step down wholly owned subsidiary of ONGC Videsh raised USD 1 billion comprising of USD 400 million Senior Unsecured Notes due 2022 and USD 600 million Senior Unsecured Notes due 2026 in the international capital markets in July 2016. The bond issuance was made at competitive rates and was well received by the investors. The deal was awarded the "Best Corporate Bond" deal from India at The Asset Triple A Country Awards 2016. - ONGC Videsh Vankorneft Pte. Ltd also raised finances by way of bridge loan to acquire 11% interest in JSC Vankorneft in October 2016. The bridge loans were replaced in April 2017 for which the company tied up facilities of USD 500 million and JPY 38 billion syndicated for longer tenor at competitive prices from International commercial banks. (b) During FY'17, ONGC Videsh signed the following Memorandum of Understanding (MoUs): i. MoU with SOCAR Trading SA: ONGC Videsh and SOCAR Trading SA signed an MoU on 27th May, 2016 for co-operation in identified areas such as co-operation in joint marketing of Azeri crude, other mutually agreed crude oil/gas etc. ii. MoU with Dana Energy: ONGC Videsh and Dana Energy have entered into an MoU on 18th August 2016 for development of possible projects in Iran. iii. MoU with Roseneft: ONGC Videsh and Rosneft, Russia signed an Agreement on 15th October 2016 for mutual cooperation in the area of education and training. iv. MoU with Ecopetrol: ONGC Videsh and Ecopetrol entered into an MoU on 8th March 2017 as a way-forward for realizing the common intention of relinquishing Block RC-10 and transfer of pending Minimum financial commitments of Block RC-10 to new block(s). v. MoU with Mubadala: ONGC Videsh and Mubadala Petroleum signed an MoU on 6th February, 2017 for future collaboration in upstream oil and gas exploration, development and production projects in third countries. vi. MoU with Gazprom Neft PJSC: ONGC Videsh and Gazprom Neft signed an MoU on 29th March, 2017 for cooperation for geological survey, exploration, appraisal, development and production of hydrocarbons on the continental shelf of the Russian Federation and third countries. (c) Operations i. Syria: The ongoing geo-political situation in Syria including EU sanctions and the resulting restrictions on contractors continue to adversely affecting Syrian operations since December 2011. ii. South Sudan: The operations in South Sudan projects are temporarily under shutdown due to internal conflicts and adverse security situation in the country since December, 2013. iii. Venezuela: As a part of remediation plan in San Cristobal project, water injection (45 KBPD) facilities for phase-I are near finalization which will arrest decline in production. iv. PetroCarabobo: The crude sale and purchase agreement (SPA) was signed between President PCB & PPSA in Nov 2016. After construction of pipelines, the changeover of diluent from Naptha to Mesa-30 has been affected since 11th March 2017 and the JV is producing Merey-16 to result in better value realization of extra heavy crude (XHO) being produced. v. Sakhalin-I, Russia: A new onland rig "Krechet" for Odoptu field has been commissioned in early 2017 for stage 2 development of the Odoptu field with a drilling plan of 32 wells. Drilling of world's longest ERD well (O5-RD) in Chayvo field with measured length of 15000m is in progress. The well was spudded on 6th March 2017. Earlier world record of longest well of 13,500m is also held by Sakhalin-I project. Direct Subsidiaries and Joint Ventures of ONGC Videsh: 1. ONGC Nile Ganga B.V. (ONGBV): ONGBV a subsidiary of ONGC Videsh, is engaged in E&P activities directly or through its subsidiaries/Jvs in Sudan, South Sudan, Syria, Venezuela, Brazil and Myanmar. ONGBV holds 25% Participating Interest (PI) in Greater Nile Oil Project (GNOP), Sudan with its share of oil production of about 0.481 MMT during FY'17. ONGBV also holds 25% PI in Greater Pioneer Operating Company (GPOC), South Sudan. Due to adverse geo-political conditions, ONGC Videsh could not produce in GPOC, South Sudan during FY'17. ONGBV holds 16.66% to 18.75% PI in four Production Sharing Contracts in Al Furat Project (AFPC), Syria. Due to force majeure conditions in Syria, there was no production in AFPC project during FY'17. ONGBV holds 40% PI in San Cristobal Project in Venezuela through its wholly owned subsidiary ONGC Nile Ganga (San Cristobal) BV with its share of oil & oil equivalent gas production of about 0.475 MMTOE during FY'17. ONGBV holds 27% PI in BC-10 Project in Brazil through its wholly owned subsidiary ONGC Campos Ltd. with its share of oil and oil equivalent gas production of about 0.643 MMTOE during FY'17. It also holds 25% PI in Block BM-SEAL-4 located in deep-water offshore, Brazil through its wholly owned subsidiary ONGC Campos Ltd. ONGBV also holds 8.347% PI in South East Asia Gas Pipeline Co. Ltd., (SEAGP) for onshore Pipeline project, Myanmar through its wholly owned subsidiary ONGC Caspian E&P B.V.San Cristobal Project: Consequent to the signing of agreements on Pending Payments and Financing of San Cristobal project for remediation plan between PdVSA and ONGC Nile Ganga (San Cristobal) BV on 4th November 2016, PdVSA has paid USD 19.75 million till March 2017 to liquidate partly the outstanding dividend due from the JV Petrolera IndoVenezolana S.A.(PIVSA) 2. ONGC Narmada Limited (ONL): ONL has been retained for acquisition of future E&P projects in Nigeria. 3. ONGC Amazon Alaknanda Limited (OAAL): OAAL, a wholly-owned subsidiary of ONGC Videsh, holds stake in E&P projects in Colombia, through Mansarovar Energy Colombia Limited (MECL), a 50:50 joint venture company with Sinopec ofChina. During FY'17, ONGC Videsh's share of oil and oil equivalent gas production in MECL was about 0.555 MMTOE. 4. Imperial Energy Limited (IEL): IEL, a wholly-owned subsidiary of ONGC Videsh incorporated in Cyprus, has its main activities in the Tomsk region of Western Siberia, Russia. During FY'17, Imperial Energy's oil and oil equivalent gas production was about 0.298 MMTOE. 5. Carabobo One AB: Carabobo One AB, a subsidiary of ONGC Videsh incorporated in Sweden, indirectly holds 11% PI in Carabobo-1 Project, Venezuela. During FY'17, ONGC Videsh's share of oil and oil equivalent gas production was about 0.151 MMTOE. 6. ONGC BTC Limited: ONGC BTC Limited holds 2.36% interest in the Baku-Tbilisi-Ceyhan Pipeline ("BTC") which owns and operates 1,768 km oil pipeline running through Azerbaijan, Georgia and Turkey. The pipeline mainly carry crude from the ACG fields from Azerbaijan to the Mediterranean Sea. 7. Beas Rovuma Energy Mozambique Limited (BREML): BREML was incorporated in British Virgin Islands (BVI) and holds 6% PI in Rovuma Area 1, Mozambique. 8. ONGC Videsh Atlantic Inc. (OVAI): ONGC Videsh setup a Geological and Geophysical (G&G) Centre at Houston, USA through its wholly owned subsidiary ONGC Videsh Atlantic Inc. The Centre caters to requirement of G&G studies for potential new acquisitions ofONGC Videsh including G&G studies of its existing portfolio of projects. 9. ONGC Videsh Rovuma Limited: ONGC Videsh Rovuma Limited a wholly owned subsidiary of ONGC Videsh was incorporated in Mauritius for re-structuring of 10% PI in Rovuma Area 1, Mozambique. 10. ONGC Videsh Singapore Pte. Ltd.: The Company was incorporated on 18th April, 2016 in Singapore for acquisition of shares in Vankorneft, Russia, through its subsidiary ONGC Videsh Vankorneft Pte Limited. OVVL holds 26% shares in Vankorneft, Russia and its share of production during FY'17 was 4.545 MMTOE. 11. ONGC Mittal Energy Limited (OMEL): ONGC Videsh along with Mittal Investments Sarl (MIS) promoted OMEL, a joint venture company incorporated in Cyprus. ONGC Videsh and MIS together hold 98% equity shares of OMEL in the ratio of 49.98 : 48.02 remaining 2% shares are held by SBI Capital Markets Ltd. OMEL also holds 1.20% of the issued share capital of ONGBV by way of Class-C shares issued by ONGBV exclusively for Syrian Assets and is being financed by Class-C Preference Shares issued by ONGBV. (II)Mangalore Refinery and Petrochemicals Limited (MRPL) Your Company continues to hold 71.62 per cent equity stake in MRPL, a Schedule 'A' Mini Ratna and listed entity, which is a single location 15 MMTPA Refinery on the West coast. Performance Highlights FY'17 MRPL achieved the highest-ever throughput of 16.27 MMT in FY 2016-17 against 15.69 MMT in FY 2015-16. Marketing & Retail Operations MRPL continues to expand its market spread in the direct sales segment of petroleum products in Karnataka and its adjoining states. MRPL has significant market share and direct customer relations for products such as Bitumen, Fuel Oil, Sulphur, Diesel, Naphtha, Petcoke and Mixed Xylene in its refinery zone. The total sales volume of direct marketing products including polypropylene during FY 2016-17 was 1858 TMT. MRPL has penetrated the polypropylene market with additional grades and has achieved sales volume of 264 TMT during FY 2016-17. The Company has in a remarkably short term achieved a leadership position in south India for few large volume polymer grades. Future projects of MRPL The Company has taken up the enhancement of the Refinery capacity to 18/25 MMTPA with low cost revamp. Land allocation of1050 acres has been made by the Government of Karnataka. Necessary steps are being taken to ensure compliance with BS- VI fuel quality standards by the year 2020. Acquisition of controlling stake in OMPL Subsequent to OMPL having become a subsidiary of MRPL and a Government company under Companies Act, 2013, the process of merger/ amalgamation of OMPL into and with MRPL is under process. ONGC Mangalore Petrochemicals Limited (OMPL) OMPL has been promoted by your Company, which has set up Aromatic Complex with an annual capacity 914 KTPA of Para-xylene and 283 KPTA of Benzene in Mangalore Special Economic Zone (MSEZ) as value chain integration project of your Company. After the successful commissioning of OMPL, MRPL has increased its equity from 3% to 51.002% in Feb, 2015 with balance 48.998% held by your Company and thus OMPL has became a subsidiary of MRPL. The total project cost is about Rs.69,110 million. OMPL commenced commercial operation from 1st October, 2014. OMPL is presently operating at 95% capacity utilization. During FY'17 OMPL achieved highest revenue of Rs.52,565 Million with highest exports of Rs.37,412 million, establishing a niche presence in the international market. 6. Annual Report of Subsidiaries and Consolidated Financial Statement The Consolidated Financial Statement for the year ended 31st March, 2017 of your Company have been prepared in accordance with section 134 of the Companies Act, 2013, Ind AS 110 "Consolidated Financial Statements" and Ind AS 28 "Investments in Associates and Joint Ventures". The audited Consolidated Financial Statements for the year ended 31st March, 2017 form part of the Annual Report. Full Annual Report of subsidiaries of the Company will be made available to any shareholder upon request, which is also available on Company's website. Further, Annual Reports of MRPL and ONGC Videsh are also available on website www.mrpl.co.in and www.ongcvidesh . com respectively. 7. Joint Ventures/ Associates 1-1 (a) ONGC Petro additions Limited ONGC Petro-additions Limited (OPaL) is promoted by your Company as a Joint Venture ( JV) Company, with envisaged equity stake of 26% along with GAIL (8.85%). GSPC also has a token presence in OPaL. The balance equity would be tied up with Strategic Partners/FIs or through Public offer. OPaL is a mega petrochemical project at Dahej SEZ for utilizing in-house production of C2-C3 and Naphtha from various units of ONGC. Hon'able Prime Minister of India dedicated OPaL to the nation on 7th March, 2017. Total project cost of OPaL is Rs.270,110 million. OPaL successfully raised Rs.72,860 million through Compulsorily Convertible Debenture at competitive interest rates. With this the entire equity of Rs.112,300 million has been tied up. All units of OPaL were commissioned during Dec'16 to Feb'17. The products of OPaL - Polypropylene, HDPE and LLDPE are well accepted by the market. (b) ONGC Tripura Power Company Limited (OTPC) OTPC is promoted by your Company with an equity stake of 50% along with Govt. of Tripura (0.5%) and IL&FS Energy Development Co. Ltd. (IEDCL - an IL&FS subsidiary) (26%); the balance 23.5% has been tied up with India Infrastructure Fund - II acting through IDFC alternatives Limited. OTPC has set up a 726.6 MW (2 X 363.3 MW) gas based Combined Cycle Power Plant at Palatana, Tripura at a project cost of Rs.40,470 million. The basic objective of the project is to monetize idle gas assets of your Company in land-locked Tripura state and to boost exploratory efforts in the region. Power evacuation for both the units is done through 663 KM long 400 KV double circuit transmission network by the North-East Transmission Company Limited (NETC), a joint venture of Power Grid Corporation, OTPC and Governments of the North-Eastern states. OTPC's both power units of 363.3 MW each are fully operational since 4thJan, 2014 and 24th March, 2015 respectively. Plant achieved highest generation of 747 MW (103%) on 15th February 2017. It generated record 4170 million units of power during FY'17. The plant meets 35% power requirement of North Eastern states. It became the first Dividend paying standalone gas based power generation company in India. It also obtained CERC certification. (c) Dahej SEZ Limited (DSL) Your Company, as a Lead Promoter has developed a multi-product SEZ at Dahej in coastal Gujarat to set up C2-C3 Extraction Plant as a value-chain integration project - OPaL through JV route in this SEZ Area. Your Company has 50% equity in the project with GIDC having the rest 50%. Present Status: SEZ is already operational with total 43 units are in production and units in SEZ have clocked export of Rs.6,750 million in FY'17 against Rs.27,480 million in FY'16. Total investment is to the tune of Rs.390,000 million with employment of around 12000 people. (d) Mangalore SEZ Limited (MSEZL) Your Company has set up MSEZ to serve as site for development of necessary infrastructure to facilitate and locate ONGC/MRPL's Aromatic complex. Your Company has an equity stake of 26% in MSEZ and other equity shareholders are KIADB (23%), IL&FS (50%), OMPL (0.96%) and KCCI (0.04%). SEZ is operational since 1st April, 2015. (e) Petronet MHB Limited PMHBL is a JV company where in your Company has an equity stake of 32.72%, HPCL (32.72%) and balance 34.56 % of equity being held by leading banks. PMHBL owns and operates a multiproduct pipeline to transport MRPL's products to the hinterland of Karnataka. In FY'17 PMHBL pipeline has achieved a throughput of3.429 MMT against total throughput of 3.318 MMT last year. As per audited result for FY'17, the turnover & PAT of PMHBL are Rs.1,283 million and Rs.810 million, respectively. (f) ONGC TERI Biotech Limited ONGC TERI Biotech Limited (OTBL) which was incorporated on 26th March, 2007 is a Joint-venture Company of your Company in association with The Energy Research Institute (TERI), with shareholding of 49.98% and 48.02%, respectively. Remaining 2% shareholding is held by individuals. Through the efforts of joint research of your Company along with TERI over the years, OTBL is offering technologies and providing various Biotechnical Solutions to Oil and Gas Industry, both in India and abroad. These technologies include: Oil zapper Technology (Bioremediation) Used to eliminate & tackle oil spills, oily sludge, and hazardous hydrocarbon waste; Paraffin Degrading Bacteria (PDB) - used to prevent Paraffin Deposition in Oilwell Tubing Wax Deposition Prevention (WDP) - Used to prevent Paraffin Deposition in surface and subsurface flow lines Microbial Enhanced Oil Recovery (MeOR) - Used for Enhanced Oil Recovery by mobilizing crude oil trapped in pores of Oil Reservoirs (g) Petronet LNG Limited (PLL) Your Company has 12.5 per cent equity stake in PLL, with the same proportion of stakes (12.5% each) held by other Oil PSU co-promoters viz., IOCL, GAIL and BPCL. Dahej LNG Terminal was further expanded from 10 MMTPA to 15 MMTPA in October 2016 and the same is further being expanded to 17.50 MMTPA. A new LNG terminal of capacity 5 MMTPA has been set up at Kochi. PLL is also planning to set up an LNG terminal of capacity 5 MMTPA at Gangavaram, Andhra Pradesh. The turnover of PLL during FY'17 is Rs.2,46,160 million and PAT was Rs.17,231 million (h) Pawan Hans Limited (PHL) Your Company has 49 per cent equity stake in PHL (previously known as Pawan Hans Helicopters Limited). Balance 51 per cent equity is held by the Government of India. PHL is one ofAsia's largest helicopter operators having a well-balanced operational fleet of 46 helicopters. It provides helicopter support for ONGC's offshore operations. The GoI acting through the Department of Investment & Public Asset Management ("DIPAM") proposes to disinvest its entire equity shareholding in PHL by way of strategic sale to prospective investor(s) along with transfer of management control. GoI has appointed SBICAP as its advisor to advise and manage the Strategic Sale of PHL ("Transaction"). Meanwhile, the GoI proposed to convert its loan into equity capital by way of right issue. PHL has offered proportionate number of shares at face value to the Company. Accordingly, your Company has decided to invest a sum of Rs.1528.16 million to maintain the present equity shareholding level at 49%. 8. Other Business Initiatives, Important MoUs/Agreement (a) Re-assessment of Hydrocarbon Resources, KDMIPE, Dehradun Your Company is carrying out the project on Re-assessment of hydrocarbon resources of sedimentary basins and deep water areas of India, in association with Oil India Ltd. (OIL) and DGH. For this purpose 2 methodologies are being adopted, namely, Petroleum System Modelling-for basins with adequate geological information and data availability (11 basins) and Areal Yield-for basins with relatively poor data availability (15 basins). The project is to be completed by November, 2017. The project is being periodically reviewed by National and International Experts to ensure that the workflow for the project and quality of the deliverables are conforming the best industry practices and international standards. Presently the project is being carried out by identified teams at designated workcentres of the Company. As on 31.03.2017, the geological model for Satpura-South Rewa-Damodar, Bastar, Chattishgarh, Karewa, Vindhyan, Mahanadi, Rajasthan, Spiti-Zanskar, Mumbai Offshore and Pranhita-Godavari basins have been prepared and resource assessment and estimation of YTF will be carried out in association with international experts. The studies for twelve sedimentary basins (Cambay, KG, Cauvery, Bengal-Purnea, Andaman-Nicobar, Kutch-Saurashtra, Assam Shelf, Assam-Arakan fold Belt, Kerala-Konkan, Himalayan Fold Belt, Bhima-Kalagdi and Ganga-Punjab Plains) is in progress at designated work centres of the Company (b) National Seismic Programme: Acquisition, Processing & Interpretation of Un-appraised Areas Mo PNG has assigned your Company the responsibility of Acquisition, Processing & Interpretation (API) of 40835 LKM of 2D seismic data in Unappraised areas of Indian sedimentary basins falling in 24 onland areas (grouped in 11 sectors) except North east, situated in 18 States/Union Territory under "National Seismic Project (NSP)". The basic objective of the seismic survey is to map and study Tertiary/ Mesozoic/Proterozoic sediments for hydrocarbon prospectivity and assessment of their potential. This would enable Government to assess hydrocarbon prospectivity of the areas for carving out and offering exploration blocks in future bidding rounds as per the GoI policies. Under this project, 2D seismic data acquisition work has started in Saurashtra area on 12.09.2016 and in Rajasthan, Mahanadi, Deccan Synclise, Bhima, Kaladgi, Vindhyana and Himalayan Foreland areas in October, 2016. As on 31.03.2017, 5033 LKM of 2D data has been acquired and further acquisition is in progress. (c) Agreement between ONGC and OPaL Your Company and OPaL (ONGC Petro Additions Ltd) signed an agreement on 22.04.2016 for supply of Naphtha through Marine Route. (d) Crude Oil Sale Agreement (COSA) i. Nominated Fields: Negotiations are in progress for the new COSA with the PSU Refiners. The existing COSA was valid till 31.03.2015 and has been extended till 31.03.2018. ii. NELP Fields: Regarding crude supply from NELP fields in Gujarat to IOCL, the JV COSA for NELP fields (Karannagar, Vadatal, Nadiad & W Patan) under the Company's operatorship is under negotiation with IOC. Similarly for NELP fields in Karaikal Asset (Madanam & Nagayalanka), the process has been initiated to put COSA in place with CPCL and MRPL. (e) Regasification Agreement between ONGC and SLPL for LNG: A definitive regasification agreement was executed on 23.06.2016 for booking of1.0 MMTPA regasification capacity for a period of 20 years in 5.0 MMTPA Floating Storage and Regasification Unit (FSRU) Terminal at Jafrabad Port, Gujarat, being set up by Swan Energy Ltd. (SEL) through a Special Purpose Vehicle (SPV), Swan LNG Pvt. Ltd. (SLPL). (f) Agreement of Collaboration (AOC) with National Mining Research Center-Skochinsky Institute ofMining (NMRC-SIM): Your Company signed an Agreement of Collaboration (AOC) with National Mining Research Center-Skochinsky Institute of Mining (NMRC-SIM), Russia on 25th November 2004 for Underground Coal Gasification (UCG). Under this AOC, NMRC-SIM provided consultancy to your Company for carrying out suitability studies for some coal / lignite blocks in India. Award of mining lease for the said Vastan lignite block by Mo C, GoI is still awaited. The AO C with SIM expired on 24th November, 2014 and has been extended for another five years upto March 4, 2020. (g) Industry Affiliates programme (IAP) Agreement on Chemical EOR was signed on 10.03.2015 between IRS and University of Texas, Austin, Texas, USA and it is valid for five years. (h) MoC between ONGC PAN IIT: Your Company has entered into a Memorandum of Collaboration (MoC) with PanIIT in January 19, 2015 at New Delhi to work towards a collective R&D Programme for developing indigenous technologies to enhance exploration and exploitation of hydrocarbons and alternate sources of energy. Pan IIT is a consortium of seven premier Indian Institutes of Technology namely, IIT-Kharagpur, IIT-Kanpur, IIT-Madras, IIT-Mumbai, IIT-Delhi, IIT-Guwahati and IIT-Roorkee. This is long-term initiative for sustained research, development and capacity building. Under this program a total of 15 projects have been taken up in Phase-I and for Phase-II, 12 projects approved by the Program Advisory Committee. Further, for Phase-III, a total of 55 project proposals have been received from various IITs and the same have been under review by ONGC Institutes. (i) MoU with Geological Survey of India: Your Company and GSI Training Institute (GSITI), Hyderabad entered into a Memorandum of Understanding which aimed at providing exposure and advanced field geological training to young ONGC geoscientists at GSI Field Training Centers (FTCs) at Kuju (Jharkhand) and Aizawl (Mizoram). As per the MoU, the first batch of15 young geoscientists from all the Company underwent training in Field Geology at the GSI Training Institute's Field Training Centers (FTCs) in Kuzu (Jharkhand) and Aizawl (Mizoram) from 8th to 31st March, 2017. (j) Farm-in/Farm-out Agreement with Gujarat State Petroleum Corporation Limited (GSPC) in respect of NELP Block KG-OSN-2001/3: Your Company has acquired 80% stake in the block KG-OSN-2001/3 falling in KG Offshore along with Participating Interest (PI) and Operatorship at a purchase consideration of US$ 995.26 million for DDW Field in the Block. The Farm-in/Farm-out Agreement was executed between your Company and GSPC on 10.03.2017. The Farm-in/Farm-out Agreement envisages: the said acquisition is subject to satisfaction of a set of conditions precedent, including mandatory Government approval. 9. Information Technology - Your Company has taken up the ambitious challenge of going Paperless. The Project has been awarded on 29th Dec 2016 and is aimed at making more than 3000 paper-based processes paperless. This initiative will be one of the Company's contribution towards our Prime Minister's initiative of Digital India. The Project is scheduled to be rolled-out in Mumbai by May 2017 and organisation-wide by June 2018. - Microwave Offshore-Onshore Project was been completed successfully. Under this project, terrestrial links were established which connect the Company's Bandra and Uran Offices with Neelam - B-193 - BPB -BPA and Heera platforms in Mumbai Offshore situated more than 100 kms away into the sea. This high-capacity backbone Microwave link is capable of carrying multi-service traffic with high spectral efficiency and providing carrier grade service. This technology driven project has gone through many challenges while constructing a 125 m Tower on Dronagiri hills off Mumbai with effective height of 205 m above MSL. This is the longest over the sea microwave link, longest offshore hop of the length of 65 kms in the region having total offshore path length of 138 kms. Link uses Radios supporting higher-order modulation of 1024 QAM with XPIC technology for higher throughput of upto 450 Mbps and reduced latency. This project will meet full gamut of IT and telecommunication needs (including Video Conferencing, RTOC, Rotary equipment monitoring and CCTV) of Neelam and Heera Asset and Bassein and Satellite Assets of Offshore and will be a stepping stone for further extension to MH Asset. Initiatives and Development in the field of Information Technology Information Security services a) CISO office is taking due initiative in ensuring information security measures across your Company. In this direction, additionally 11 Infocom Data Centres (Karaikal, Rajahmundry, Kolkata, Dehradun, Vadodara, Hazira, Jorhat, Nazira, Agartala, Mehsana and Ankleshwar) and 4 G&G Data Centres (Panvel-SPIC, VRC, EPINET and GEODEC) were taken up for ISMS implementation through in-house resources. ISMS documentation of 11 Infocom Data centres have been completed and documentations of 4 Geological and Geophysics (G&G) Data Centres are in progress. b) For the first time, IS awareness session was conducted for GTs during their MultiDisciplinary Training (MDT) at Dehradun. EACS Project: A state-of-the-art Enterprise wide Access Control and Surveillance (EACS) system project has been conceptualized to mitigate any threat perception to the security of the oil installations as well as offices of your Company. For the implementation of the state-of-the-art EACS system, contracts have been awarded to- - M/s BEL (LSTK contractor) for EACS project implementation. - M/s RITES (PMC contractor) for EACS project management. - M/s PDIL (TPI agency) for Third Party Inspection services for EACS project. Online Project Monitoring and Control (OPMAC) tool of SAP system is used for uploading all the project related documents and their versions. Suitable trainings have been provided to the concerned executives from the various work centres and also to the contractor's personnel for its use. 10. INDEG-Make in India Campaign in ONGC Your Company is leading the upstream sector in Make in India Campaign, and embarked on a time bound plan by MoPNG for successful implementation of the campaign in the oil and gas industry. This major national program is designed to facilitate investment, foster innovation, enhance skill development, protect intellectual property and build best-in-class manufacturing/ services infrastructure to make India a manufacturing hub and bringing economic transformation in India. Your Company carries its legacy of being the pioneer corporate in initiative on Import Substitution and indigenisation. In the last few decades through its INDEG Group, your Company has developed many Indian vendors and some of them are now international players in their areas. ONGC's initiatives has helped Public Sector Units to expand their capabilities, and your Company has helped creation of some of the large Indian companies in services and projects areas of oil & gas. With the new thrust through the "Make in India" campaign, your Company has revived its multi-pronged approach to enhance the capabilities of Indian equipment, goods, services and projects market, through promotion of Indian vendors for development in India and through tie-ups with global players. Indigenization of Capital, Stores and Spares items A. UPET Rig Spares i. Your Company has done indigenized revamping of Wireless Remote Control System for Romanian 50-IV- Work over Rig, at a cost of Rs.46.8 million. ii. Central Workshop Vadodara of your Company successfully completed capital refurbishment of imported ROM-100-I rig (Romanian) and Rom-50-IX Rig, adding a fresh lease of life to the work-over Rigs. All capital repairs and maintenance of imported equipment of the rig are carried out indigenously. iii. Your Company during the refurbishment has developed various spares locally for UPET-ROM make (Romanian) Work over rigs. B. Drilling Services i. Your Company has developed an in-house innovative PLC controlled Safety System for Travelling block movement. This system has been successfully installed on an on-shore drilling rig. ii. Radial drilling, a productivity improving drilling technology, was carried out in four wells for the first time to enhance reach in the reservoir and increasing flow path. C. Production Process Equipment i. Your Company has recently developed SRP monitoring system in-house and introduced it successfully in 57 SRP wells in Limbodra GGS II, Ahmedabad. This system will help to attend the fault and revive instantaneously thus reducing the downtime particularly for remote locations. The cost of such system is very low compared to procurement from an international source. ii. Your Company has domestically carried out indigenous repairs on 2 Cryogenic pumps used in LNG facility at Dahej, manufactured by Ebara International Corporation, USA (EIC). The failure oftwo of these three pumps had forced the plant capacity to 50%. Your Company successfully undertook indigenous repairs of these pumps, thus saving 83% of cost at Rs.3.15 million against Rs.17.6 million. iii. A chemical formulation of polymeric surfactant was developed and prepared by RGL, Vadodara for treatment of asphaltic or waxy crude for flow improvement. The solution was successfully tested and used for crude oil in Cambay Basin. D. Well Services i. Well Stimulation Services of your Company has indigenized products worth nearly Rs.9.8 million and developed 10 vendors in the process. It has also saved Rs.364.4 million through use of indigenous equipment and services in its Make in India efforts. ii. Rig BHEL 120 VI of Well Services was successfully refurbished thereby adding a fresh lease of life to the Work over Rig. iii. Successful fracturing of deepest and highest temperature well at Rajahmundry was carried out by in-house team (depth of4069.5 Mts and BHT - 165.5øC) using in-house developed fracture fluid for this high temperature. E. Other Equipment Indigenization Your Company carried out successful replacement of display monitors in logging unit with indigenously manufactured advanced feature monitors thereby saving Rs.0.45 million per unit of such replacements. Tie ups with Global Players a) Global Industry Players - Tie ups in India i) Riser Maintenance yard in Kakinada in Andhra Pradesh has been developed by Transocean, to avoid the need to periodically export & re-import the "Risers" for inspection and reconditioning. This facility includes Riser certification, Floatation repairs, Preservation - enhancing the life of costly asset and adequate storage area. The facility is operated through JVs with international companies Vetco/NOV for riser joints and Dynaglass for floatation modules. ii) Equipment and Services Centre set up by NOV India Pvt. Ltd. (NOVIPL) extends aftermarket support services to all Oil/Gas producing companies for Service, Repair, Parts Supply and extending Technical Training. NOVIPL has acquired 4 workshops in India, Mumbai (2), Chennai and Pune one each for repair, recertify, all NOV supplied equipment. Previously all these jobs were done in Singapore and UAE. These workshops are supported by many small Vendors, fabricators, and suppliers within India. NOV is also sourcing parts manufactured in India through strategic partnership with local manufacturers. iii) Offshore Vessels and Rig Repair set up by Sembmarine Kakinada Limited (SKL) is a JV between Sembwang Shipyard Pte. and Kakinada Seaports Limited. SKL is operating within the vicinity of Kakinada Seaports and will be developed in 3 phases to offer shipowners and offshore operators a one-stop integrated offshore service facility for the repairs and servicing of offshore vessels and ships, oil and gas riser/equipment repairs as well as platforms and modules fabrication. Your Company has awarded repair job of its floater rig Sagar Vijay. SKL is also engaged in repair of various other Indian flag vessels. iv) Land Rig Manufacturing unit set up by Drillmec India Pvt Ltd. Drillmec India has manufactured the First Mobile Rig Workover & Drilling Mod. MR 8000. It is a joint venture company between Drillmec S.p.A Italy and KMOC Kakinada Marine and Offshore Complex Ltd. India. b) Domestic Ancillary Companies in India by Global Players i) NOV Rig system: Repair and servicing of major drilling equipment like BOPs, Risers, Pressure control equipment, etc. ii) Hydril Pressure Control Pvt. Ltd. : Hydril BOPs are being inspected and repaired at Hydril facility in Chennai. 11. 'ONGC Start-up' Initiative "Start-up India" initiative was launched by the Hon'ble Prime Minister of India on January 16, 2016, which aims at fostering entrepreneurship and promoting innovation by creating an ecosystem that is conducive for growth of "Start-ups". Your Company has launched Rs.1000 million Start-up fund on its 60th Foundation Day, i.e. on 14th August 2016 to foster, nurture and incubate new ideas related to energy sector. 'ONGC Startup' Fund shall cater to the "Energy Sector". Your Company intends to provide the entire support chain for start-ups including seed capital, hand-holding, mentoring, market linkage and follow-ups. The aim of 'ONGC Start-up' is to increase the contribution of fresh implementable ideas in the oil and gas sector. The following road-map has been considered for implementation of the Start-up Initiative. a) Creating a Start Up Fund: - Your Company has already announced launch of Rs.1000 million Start-up fund on 14th August 2016 b) Creating Awareness & Invitation of Proposals - Your Company created a webpage on its corporate website for creating awareness about the initiative on 14th August 2016 - Dedicated Website: A dedicated website startup.ongc.co.in for 'ONGC Startup' initiative has been created, which was launched by Honorable, Union Minister of State (I/C) Petroleum and Natural Gas on 7th December 2016. Start-ups are registering their interest through this website for sharing their ideas and seeking support from ONGC. c) Collaboration for Technology Business Incubation - Your Company entered into a MoU with IIT Bombay (IITB) and Society of Innovation and Entrepreneurship (SINE), on 7th December, 2016. In collaboration with IITB and SINE, your Company intends to nurture and incubate new ideas related to energy sector. The first batch of incubation of Start-Ups is likely to happen in early 2017-18. 12. Health, Safety and Environment (HSE) Accreditations and Other Achievements Being a high risk industry, safety of its employees is topmost priority for your Company. Achieving the annual targets with "Mission-Zero Fatality" is the theme adopted for the year 2016-17 with each employee of the organization as safety officer. Globally recognized QHSE Management System is implemented conforming to requirements of QHSE Certifications ISO 9001 ISO 14001 and ISO 18001 (OHSAS) at the Company's facilities and certified by reputed certification agencies at all its operational units. Corporate guidelines on online incident reporting, investigation and compliance monitoring of various rules and regulations have been developed and implemented for maintaining uniformity throughout the organization in line with international practices. Accreditations: a. Your Company is accredited by National Accreditation Board for Education & Training (NABET) - Quality Council of India (QCI) accreditation as the Consultant Organization for the purpose of carrying out Environment Impact Assessments of offshore and onshore Oil and Gas Exploration, Development & Production and Petroleum refining industry sectors. This helps in saving substantial time and money in getting EC which helps in an early commencement of the operations. Highlights of HSE during 2016-17: a) Performance of Memorandum of Understanding (MoU) with MoPNG on HSE parameters: Your Company gives highest priority to the implementation of the observations raised during External Safety Audits (ESA) and Internal Safety Audits (ISA). Highest compliance to the observations has been achieved, as under: External Safety Audits Internal OISD DGMS Safety Audits 97.54% 94.09% 88.5% b) The Mines Vocational Training: 2546 (1329 ONGC+ 1217 Contractual employees) have been provided to the field going personnel. c) Various safety awareness programs were conducted at all work centres with the theme "Safety Rules Saves Lives" for the year 2017. d) Review of HSE policies including Improvement in policies on training of Contractual Employees, HSE Manpower Reporting, Safety briefing guidelines, Behavioural Based Safety, Compliance pending M B Lal recommendations, Safety critical equipment, Issuing of SOPs, Accident/ incident analysis by Third party and Setting of ERC at Corporate Office. e) Online incident reporting started as per the requirement of PNGRB regulation. f) A detailed HSE dossier for each work centre was provided to all Asset/Basin Managers and Services Chiefs for monthly monitoring. Dossier includes ISA compliance status, OISD audit observations, DGMS observations, EC decision compliance, SOPs, Safety Champion, issues related to Environment, Mock Drills, ERP upgradation, Hazard Alert Card, Accident/Incidence reporting in SAP, compliance to recommendations of inquiry committees in fatal & major accidents in last three years, PME and Safety Critical Equipment. The VCC at each work centre will discuss all the HSE pending issues as per EC decision and status/ ATR will be submitted to Chief HSE on monthly basis. g) DGMS in association with the Company and other upstream oil companies reviewed and prepared the Draft OMR 2014 based on OISD standards & submitted to the Ministry of Labour and Employment. The draft OMR Regulation 2016 has been finalised and is expected to be published shortly. h) In order to improve monitoring of DGMS observations, first time an initiative was taken to upload DGMS observations in ICE system, in pursuance of which all planned 6794 observations have been uploaded in ICE system for online monitoring. i) For onshore locations, roll out ofe-PTW started with go live at GGS7-Kalol, Ahmedabad Asset on 6th March 2017. The process of training and roll out at Onshore shall be completed by September 2017. e-PTW is already running at Uran, Hazira, all offshore process complexes and ONGC owned Rigs. j) The first Asian Ministerial Conference on Disaster Risk Reduction was hosted by Government of India in collaboration with the United Nations International Strategy for Disaster Reduction (UNISDR) from 3rd to 5th November, 2016 at Vigyan Bhavan which was inaugurated by Hon'ble Prime Minister of India. Your Company showcased its capabilities contributing towards effective disaster risk reduction, mitigation and preparedness with the help of two working models of fire-fighting systems of fixed oil and gas production installation and drilling / work-over rig. A brochure on crisis management team activities was also released. k) Third Party Audit of 14" & 16" Hazira-KRIBHCO pipelines, 10" Sonamura -Monarchak pipeline and 20" Uran Trombay Pipeline has been conducted as per PNGRB regulations. l) Safety Audit generic observations compendium has been prepared by scanning through all observations raised during external and internal audits for last four years. A mechanism has been designed in SAP system (ICE) for monitoring regular compliances of these observations every six months installation and rig wise. m) In view of notification issued for drill cutting (from water base mud) waste under non-hazardous category issued in Schedule -1 of Hazardous and Other Wastes (Management & Trans boundary Movement) Rules, 2016, the disposal of drill cuttings from water based mud does not attract the provisions ofHazardous and Other Wastes (Management & Trans boundary Movement) Rules, 2016 and this will save a lot of time as authorization under Hazardous Waste Rules will not be required. n) Dispensation has been obtained from the Ministry of Environment, Forest and Climate Change regarding requirement of Forest Clearance for Shot Hole drilling during seismic survey. o) The Environment ministry permitted ground flaring without the provision of 100 meters green belt. In view of scarcity of land, the provision of ground flaring without 100 m green belt will be helpful for your Company. p) Preparation of 5 Nos. of in-house EIA reports resulting in notional savings of approximately Rs.22 million and saving of valuable time. 13. Carbon Management & Sustainable Development Your Company's hydrocarbon exploration & production (E&P) operations are being carried out in varied climate and environment areas ranging from deserts to coastal areas, hilly terrains to forest areas, shallow water to deep waters and also in ultra-deep water areas. These E&P activities often interact with the ecosystems and may have physico-chemical & bio-geochemical impact on the surrounding environment. Your Company, being responsible Corporate not only cares and preserves the environment but also makes efforts for its protection. It is fully conscious to see that ecology & environment are preserved and even improved by taking consistent steps and also through technological upgradation. Your Company has put in place an effective Environment Management Plan and is also taking advance preventive actions so that environment is protected and its activities can remain in harmony with nature. Your Company has also set up a dedicated Institute viz. Institute of Petroleum Safety and Health Management (IPSHEM) at Goa for conducting trainings for industrial health, safety and environment management and also to promote practices in the organization about the safety, health and environment aspects in every phase of operations by evolving best practices and providing trainings in virtual environments. Your Company has taken requisite measures to minimize the impact of E&P activities and taken various measures to mitigate the pollution. It has introduced clean technologies for emission control including design and construction facilities for different, gaseous, liquid and solid effluent generated due to drilling, production and processing facilities from onshore and offshore operations. Measures taken for Mitigating Air Pollution There are no major risk for air pollution like process industry. The source of air emissions are flaring of natural gas, exhaust from running of DG sets, use of heavy equipments, construction activities, movement of vehicles etc. In order to reduce the gas flaring, generators have been installed in the field to utilize low pressure gas for generation of electricity for internal consumption. Regular ambient air quality monitoring studies are carried out around drill sites and production installations as per statutory requirement to measure and monitor concentration of air pollutants in ambient air. The concentration of air pollutants have been found to be within the permissible limits. Gaseous Emissions Control through BoxFlare: Box flare facilities have been installed at Uran Terminal, Hazira Gas Processing Complex and Assam Group Gathering Stations to achieve following - Complete combustion of the flared gases using several stage multiple burners. - Use of low NOx burners. - Cladded in refractory shells with steel enclosures to control the effect of heat and light radiations. - Acoustical insulation for noise control. Smokeless Flaring: The smokeless flare is achieved by properly designed tall stacks with following facilities. - Use of steam injections - Providing additional Oxygen - Height of the stack is maintained in such a way that when emissions strike the ground, they should have ground level concentration within permissible limits. Real Time Monitoring Stations (RTMS): 5 no's of RTMS are installed each at Uran Terminal and Hazira Gas Processing complex to monitor the ambient air quality in and around plants round the clock. Reduction in Gas Flaring/Low Carbon Fuel: In order to reduce GHG emissions, the low pressure gases and other natural gas is being utilised to operate Compressors, Turbines and DG Sets. Vapour Recovery System: Vapour Recovery system has been installed at the crude oil storage tanks to prevent release of fugitive emissions, VOCs etc. besides to check the loss of HC. De-sulphurization of Sour Gas: The sour gas produced from South Bassein Field of West Coast is sweetened at processing plant through Sulphur Recovery Units (SRUs) to avoid the release of acidic gas to the atmosphere. Measures taken for Mitigating Water Pollution and its Management Conservation of fresh water: Towards conservation of an important natural resource 'fresh water' through its replenishment in the aquifer to prevent its further depletion and to sustain ground water table. Six wells to collect the discharge water at different locations of the KDMIPE campus are active. Waste Water Management: Your Company monitors the use of water resources and quality of effluent discharge. Effluent Treatment Plants have been installed in work centres to treat effluent generated during processing of oil and gas to meet statutory requirements for discharge of treated effluent at surface/subsurface. Water Conservation through Rain Water-Harvesting: For conservation of fresh water, your Company has a policy on Rain Water Harvesting which is mandatory for all future projects. Details of existing Rain Water Harvesting projects are given in the section 'Sustainable Development'. Treated water is used for various purposes during drilling at drill site and injecting into the formation for the purpose of maintaining formation pressure. Treated effluent is also used for gardening purpose, floor cleaning and other utilities. Your Company follows the policy of Recycle, Reuse and Recovery for water conservation. Effluent Treatment Plants: In view of environmental friendly disposal of produced effluent, ONGC has set up 26 Nos. of ETPs at different work centres of your Company to treat about 78110 m3/d of waste water produced during E&P operations. Lining of drill site waste pit with High Density Poly Ethylene Sheets (HDPE): To avoid contamination of ground water quality of surrounding areas, HDPE lining is laid in waste pit at drill site. In this way percolation of waste water in the ground during drilling of wells is checked and ground water quality is protected. Produced Water Conditioners (PWCs): Produced Water Conditioners (PWCs) have been installed for treatment of offshore effluent (produced water). For treatment of sewage water being generated at living quarters at offshore platforms, Sewage Treatment Plants (STPs) have been installed before discharging it at offshore. Therefore, the waste water separated from oil and gas is treated and pollutants values are maintained as per prescribed limits before discharging it at onshore/offshore. Offshore Monitoring to check Marine pollution at West & East Coast: To study the impact of E&P operations on Marine Environment, your Company has instituted regular offshore monitoring at West Coast and East Coast covering the entire operational areas. The reports are regularly submitted to regulatory authorities. Oil Spill Management - Response and Combat: Your Company has the capability to handle 700 MT of oil spillage using its Oil Spill Response equipment stockpile kept on 5 different Multi Support Vessels which are strategically positioned 24 x7 round the year to cover the entire operational area to ensure minimum response time during emergency. It has also in place a Contingency Plan duly approved by the Indian Coast Guard for both West and East Coast. For oil spills of Tier - 3 level i.e. - 10,000 MT. Your Company has an agreement with Oil Spill Response Limited, UK for oil spill combatment. Besides, the Company participates in various National Level Exercises with Indian Coast Guard thereby ensuring commitment for marine Environment Protection. Soil Pollution control: Bio-remediation: The oil is recovered from the oily waste produced during drilling operation as far as possible. The remaining waste and oil contaminated soil is subjected to Bioremediation where the oil content is reduced to less than 1% TPH using a consortium of Hydrocarbon degrading bacteria by the OTBL since March 26, 2011. During 2016-17, 25220 MT of oily sludge/ oil contaminated waste has been bio-remediated. Noise Pollution Control: Following mitigation measures to control noise impacts: - Regular noise monitoring is done to measure and monitor sound levels around equipments and machineries and high noise areas are demarcated. - Acoustic enclosures are provided around gen-sets to reduce noise pollution. - Personnel Protective Equipment (PPE) like ear muff/plugs is provided to personnel working in noise prone areas. - Green belt is developed and maintained around major installations which also contribute in mitigating noise pollution. Afforestation projects resulting in CO2 Fixation through Mangrove & Ringal Plantation: Creating Green and Clean Environment: Green belts have been developed up to one third of total area around all the production installations and processing plants to comply with the stipulations of various permissions obtained from state as well as central government. In addition to regular plantation at drill sites and production installations, your Company has undertaken following massive plantation as part of your Company's Corporate Social Responsibility for Environment Protection & for mitigation of Climate Change impacts and also to conserve biodiversity. Mangrove Plantation: A project on mangrove plantation along the shores of Dhadar River on West Coast has been taken up by the Company to protect erosion of shoreline. In the Phase 1 of the project, more than 21.11 lakh mangroves have been planted in the soil erosion-prone area along the coast of the Dhadar River at Gandhar, Ankleshwar and Hazira area. Ringal Plantation: Ringal plantation (Hill bamboo) has been undertaken by the Company in Joshimath and Kedarnath forest areas of Upper Himalayas to strengthen fragile Himalayan eco-system. Plantation of 1.075 million Ringal Plantation in Upper Himalayas is already completed in an area of 430 Hectares in three phases resulting in 1.97 million tonnes of CO2 fixation per annum. Another 0.75 million Ringal plants will be planted in two phases in an area of 300 Ha in Upper Himalayan region which shall result in an additional 1.37 million tonnes of CO2 fixation per annum. An Agreement was also signed with Uttarakhand Bamboo and Fiber Development Board, Dehradun on 01.03.2016 for fourth phase of Ringal Plantation. Other initiatives: a. Green Building: Your Company acknowledges that buildings have major environmental impact over their entire life cycle. Hence, the Company has taken up concept of constructing green building, the essence of which would be to address all these issues in an integrated and scientific manner with due compliance to the guidelines of GRIHA (Green Rating for Integrated Habitat Assessment). As part of its commitment to sustainable development, it is planned to build Green Buildings at Delhi, Mumbai, Kolkata and Dehradun. These buildings are expected to save 50% to 60% energy, save water by about 30%, harvest 100% rainwater and discharge zero sewage and as compared to baseline buildings. Currently, Green buildings at Delhi, Mumbai, and Dehradun house the officers of the Company. b. Replacement of Halons: Corporate HSE has obtained a clarification from the Ozone Cell, MoEF & CC regarding the issue of replacement of Halon based Fire Suppression System. The clarification issued by the Ozone Cell permitted the use of recycled/ recovered Halon. Further, it was clarified that the roadmap was developed for phasing out of production and consumption of Hydro-fluorcarbons (HCFCs) in India and is not applicable for Halon. Therefore, use of the Company's existing stock of Halon can be continued. c. Use of Renewable Energy: Wind Energy: Your Company's holistic focus on sustainable growth ensures its thrust on pursuing renewable sources of energy, decreasing our internal carbon footprint and exploring unconventional hydrocarbons. Further, the Company has commissioned two energy efficient Wind Power Project, one a 51 MW Unit at Bhuj, Gujarat and another 102 MW Wind Farm in Jaisalmer, Rajasthan. Solar Energy: Many of the residential colonies in ONGC have solar water heaters and solar powered street lights. Unmanned platforms in offshore areas also use solar energy for navigation lights and telemetry units. d. Sustainable Development: i. Sustainable Water Management (SWM): As an E&P Company, the Company business depends on sustainability of fresh water resources which are presently under pressure. Globally, per capita availability of freshwater is steadily decreasing and trend will inevitably continue with the increasing consumption levels and climate change unfolds. In this situation, it is imperative for the Company to develop new strategies for water management in order to achieve sustainable growth and development. The details of existing rain water harvesting projects of the Company are given below. - 29 ground water recharge wells at various locations of Ahmedabad Asset. - Rain water from rooftop and surface run off harvesting at Green Building, Mumbai. - Percolation well for bore well recharge at Residential complex, Ankleshwar Asset. - Rain water harvesting system as integral part of C2-C3 plant, Dahej, Gujarat. - Rain water harvesting at Rajahmundry Asset base complex. - 16 infiltration well in IPSHEM, Goa. - 2 ground water recharge wells at IRS, Ahmedabad. - 6 ground water recharge wells at KDMIPE, Dehradun. - 1 ground water recharge well at base complex, RFB, Jodhpur. - RWH system at K. V. School, NOBH and officers' club at Agartala, Tripura Asset. - RWH system, PPCL building, Uran Plant, Raigad, Maharashtra. - Bhavale Hill RWH system, Panvel, Maharashtra. - RWH system at SPIC campus, Panvel, Maharashtra. - RWH systems at various locations at Western Onshore Basin, Vadodara. ii. Clean Development Mechanism Projects Emission Reduction through CDM Projects: Your Company commenced its Clean Development Mechanism (CDM) journey in 2006. Currently, it has 15 registered CDM projects with the United Nations Framework Convention on Climate Change (UNFCCC) that yield (potential) Certified Emissisons Reductions (CER) approx. 2.1 million yearly. The registered CDM projects are as under: Sl. No. Project CER/annum 1 1 Waste heat recovery from Process Gas Compressors (PGCs), Mumbai high south (offshore platform). 5320 2 Up-gradation of Gas Turbine 1 (GT 1) and Gas Turbine 2 (GT 2) at co-generation plant of Hazira Gas Processing Complex (HGPC). 7802 3 Flare gas recovery project at Uran plant. 97740 4 Flare gas recovery project at Hazira Gas Processing Complex (HGPC), Hazira plant. 8793 5 Amine Circulation Pumps Energy Efficiency at Hazira Plant. 4043 6 51 MW wind power project of ONGC at Surajbari. 85762 7 Energy Efficient Green Building at Mumbai. 544 8 Energy Efficient Green Building at DehraDun. 735 9 Gas Flaring Reduction at Neelam & Heera Asset. 65811 10 OTPC Natural gas based combined cycle power plant in Tripura, India. 1612506 11 Energy Efficient Green Building at Kolkata. 1881 12 Energy Efficient Green Building at Delhi. 5944 13 Gas flare reduction at GGS Charali Assam. 15172 14 Replacement of MOL pumps at Neelam and Heera. 10539 15 102 MW Wind Power project at Jaisalmer, Rajasthan. 180177 Total 2102769 Four production installations (CPF Gandhar, Gandhar GGS-I, Ankleshwar CTF, and Nawagam CTF) were declared carbon neutral for the year 2015-16 after voluntarily retiring 1,34,419 CERs of CP-1 credit period from CDM registry account (UNFCC). iii. Global Methane Initiative (GMI): GMI launched by United States Environmental Protection Agency (USEPA) is a voluntary, multilateral partnership that aims to reduce methane emissions and to advance the recovery and use of methane as a clean energy source. Your Company signed a voluntary agreement with USEPA in 2007 for the purpose of reducing methane releases to the atmosphere by implementing cost effective emission reduction technologies and practices. Your Company has formed a dedicated in-house team, procured methane emission detection and measurement equipment in order to undertake fugitive emission detection and quantification at its operating facilities. ONGC has also drawn an effective plan to map all its production installations for fugitive hydrocarbon emission and make the installations leak-free in the near future through gas leak surveys at various production installations using Gas Find Infrared Camera for identification of methane emission reduction opportunities. iv. Sustainability Reporting ONGC Group Sustainability Report FY'16 was released on 14th March 2017. This being the seventh report of the Company and fourth of ONGC Group (comprising of your Company, ONGC Videsh and MRPL) in succession, was prepared as per latest GRI G4.0 framework with external assurance by third party under "Core" category. 14. Business Responsibility Report -2016-17 In terms of clause (f) of sub-regulation (2) of regulation 34 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, stipulates that the annual report shall contain a Business Responsibility Report describing the initiatives taken by the listed entity from an environmental, social and governance perspective in the format specified. Accordingly, the Business Responsibility Report - for 2016-17 has been drawn up and appended to this Annual Report. 15. Internal Control System over Financial Reporting A company's internal financial control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and preparation of standalone financial statements (Ind AS Compliant) for external purpose in accordance with generally accepted accounting principles. These internal financial control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of standalone Ind AS financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the Company are being made only in accordance with authorizations of management and Directors of the Company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the Company's assets that could have a material effect on the standalone Ind AS financial statements. Your company has adequate internal financial controls system over financial reporting in compliance with the provisions of section 134(3)(c) of the companies Act, 2013 and such internal financial controls over financial reporting were operating effectively. In addition to the above, your Company has a well-established and efficient internal control system and procedure. The Company has a well-defined delegation of financial powers to its various executives through the Book of Delegated Powers (BPD). The Integrated BDP is updated from time-to-time in line with the needs of the organization as well as to bring further delegation. The Company an in-house Internal Audit Department commensurate with its size of operations. Audit observations are periodically reviewed by the Audit & Ethics Committee of the Board and necessary directions are issued whenever required. 16. R&D Efforts Through ONGC Energy Centre Trust (OECT) Your company has taken steps to evaluate various forms of energy to fulfil the country's growing energy needs. Towards this end, your company has established an ONGC Energy Centre Trust (OECT), which is mandated to undertake or assist in programs/ projects of fundamental and applied research for improving and developing commercially viable energy mediums and sources beyond hydrocarbons, especially in clean and/or renewable energy options. ONGC Energy Centre (OEC) has been set-up under the aegis of the OEC Trust to work on various clean energy options. Patents granted Patents granted during FY 2016-17 against three International PCT patents on Cu-Cl cycle, filed earlier, jointly by OEC and ICT-Mumbai in six countries (USA, Canada, Japan, UK, Korea and China) were: 1. 'Hydrogen Production Method by Multi-Step Copper-Chlorine Thermo chemical Cycle' -granted in People's Republic of China. (This patent has now been granted in five out of six countries) 2. 'Effect of Operating Parameters on The Performance of Electrochemical Cell in Copper-Chlorine Cycle' - granted in Canada. (Patent already been granted in Japan and USA) 3. 'Electrochemical Cell Used in Production of Hydrogen Using Cu-Cl Thermochemical Cycle' - granted in UK (Patent already been granted in Canada, Japan and USA) I. R&D Projects by ONGC Energy Centre during 2016-17 The year commenced with 22 projects. Another 15 projects were taken up during the year. Out of the 37 projects under implementation during 2016-17, a total of 6 projects were concluded. The year ended with 31 projects in hand. II. New Projects taken up during the year During FY 2016-17, the Company's Energy Centre has taken up Fourteen (14) new in-house/ collaborative projects, besides two new initiatives. The details are given below: A. Uranium Exploration: 1. "Drilling, logging and coring operations in approx. Thirty Eight (38) no of parametric wells in Son valley and Sagar district in MP and Karjan-Padra in Gujarat": To validate the leads obtained from drilling and 3-D seismic modelling in the areas in order to assess the potential for sub-surface Uranium. B. Hydrogen Program: 2. "Scale-up of I-S, EED & ED based membrane processes for production and concentration of HI as Hydrogen source", in collaboration with CSIR-CSMCRI, Bhavnagar: To scale-up the I-S, EED and ED for producing HI by reducing I2, increasing the HI molality (concentration) in the presence of HIx solution using indigenously prepared cation-exchange membrane and anion-exchange membrane. 3. "Development of Ceramic Membranes for Gas Separation Applications in I-S and Cu-Cl cycles For Clean Energy Production", in collaboration with CSIR-CGCRI, Kolkata: To develop zeolite membranes for separation of H2 from HI/I2 in I-S cycle, H2 from HCl vapour, SO2 and O2 from SO3 in I-S cycle on indigenously prepared clay alumina support tube and demonstration of performance of the membrane at economically scaled uplevel. 4. "Design and development of Sulfuric Acid Concentrator and Internals for Bayonet Convertor in S-I Cycles", in collaboration with FITT/IIT Delhi: To Design & develop sulfuric acid concentrator for sulfuric acid concentration in S-I Cycle, and catalyst loading and distributor system to be used in bayonet convertor, and optimize the process/ equipment configuration for future scale up. 5. "Stability tests of IIT-D developed catalysts and materials of constructions for HI decomposition reaction of SI cycle", in collaboration with IIT-Delhi: Preparation of Activated Carbon supported bimetallic Ni-Pt catalyst by impregnation-reduction method and performs long term stability tests of 600 hours and immersion corrosion coupon test to screen the potential material of construction for HI decomposition reaction. 6. "Thermo-chemical Hydrogen Generation through Partially Open-Loop S-I process involving H2S incineration: H2S incineration to SO2", in collaboration with CSIR-IIP, Dehradun: Laboratory study for the incineration of H2S to generate SO2 to develop process know-how in perspective of partially open loop S-I cycle. 7. "Development & demonstration of closed loop I-S process in all glass assembly", in collaboration with FITT/IIT Delhi: To demonstrate integrated closed loop to enable stable, continuous, and long-term operation of I-S process for hydrogen production in all glass /quartz assembly of capacity 5 NL/hr. of hydrogen production continuously for at least 10 hours. 8. "Selective Conversion of CO2 to CO using an inexpensive Nano-porous Carbon doped oxides through plasma/photocatalysis", in collaboration with Maulana Azad National Institute of Technology (MANIT), Bhopal: To develop inexpensive catalysts (nanoporous carbon doped oxides), that can convert carbon dioxide into carbon monoxide using plasma-photocatalytic technology. C. Biotechnology Program 9. "Hotwiring microbial communities for enhanced unconventional gas production" in collaboration with TERI, as Indian partner and University of New South Wales, Australia, as Australian partner, under the Australia-India Scientific Research Fund - 2015 (AISRF-2015) for collaborative research on Clean Energy Technologies. 10. "Development of hybrid nano-zyme-bacterial hydrogels for augmentation of uranium leaching from subsurface soil", in collaboration with PSG Institute of Advanced Studies (PSGIAS), Coimbatore: To develop hybrid nano-zyme-bacterial hydrogels for augmentation (by 0.01 to 0.35%) of uranium leaching from subsurface soil. 11. "Proof-of-Concept for Investigation on Microbial Bioleaching of Uranium from Secondary Uranium Deposits", in collaboration with Savitribai Phule Pune University (SPPU), Pune: To understand the geochemical composition and the indigenous microbial community structure of uranium bearing sediments and to develop enriched microbial consortia with the potential of uranium bioleaching. D. Geothermal program 12. "Feasibility of Geothermal Energy in India using Single Well and Production Method", in collaboration with Indian Institute of Technology, Delhi (IIT-D): On development of simulation model, experimental work will be planned for Single Well Engineered Geothermal Pilot Power Plant. 13. "Thermal modelling to assess Geothermal Energy Potential in Gandhar area of Cambay Basin", in collaboration with KDMIPE, Dehradun: To carry out thermal modelling of area identified by OEC for assessing Geothermal Energy resources in Gandhar Field. E. Solar Program: 14. "Development of Self-Cleaning Coatings Based on Super-hydrophobicity for Solar Panel Applications", in collaboration with PSG Institute ofAdvanced Studies (PSGIAS), Coimbatore: To develop a transparent and super-hydrophobic, self-cleaning coatings for photovoltaic solar cells, solar thermal and hybrid applications. 17. Human Resources Your Company values its Human Resources the most. To keep their morale high, your company extends several welfare benefits to the employees and their families by way of comprehensive medical care, education, housing and social security. 18. Human Resource Development - 33,660 ONGCians (as on 31st March, 2017) dedicated themselves for the excellent performance of your company during the year. The workforce intake strategy pursued by your Company caters to meeting the demands of maintaining a steady flow of talent, in a business which is characterized by high risks and uncertainties, enormous costs, fast changing level of technology, physically challenging work environment, fluctuating product prices and growing competition. Your Company has drawn up a scientific manpower induction plan aligned to the business plans as well as factoring the manpower profile of the Company. - Your Company believes that continuous development of its human resources fosters engagement and drives competitive advantage. Towards that end, during the year, your Company conducted Business Games to hone the business acumen of its executives in a competitive scenario under simulated business constraints. Business Game has proved to be very popular initiative and tests the ability of the executives through business quizzes, business simulations and case-study presentations. During the year 2016-17, a total of 163 teams and 652 executives participated in the event. Fun Team Games (FTG) were organized for E0 and below level employees to inculcate MDT (Multi-disciplinary Team) concept and spirit of camaraderie and belongingness to the organization, which was very well received by the participants. A total of 94 teams and 376 employees participated in FTG during the year 2016-17. The winners of Business Games and Fun Team Games were felicitated by the CMD on Republic Day Celebrations. - Your Company attaches utmost importance to the development of its human resource. During the year, a total of 15846 executives and 5703 non-executives were imparted appropriate training, spanning 187712 executive mandays and 20548 non-executive mandays respectively during 2016-17 to all our work centres. - In order to absorb new and emerging technological advancements pertaining to oil and gas exploration and production, 65 programmes, including 21 foreign faculty programmes pertaining to functional disciplines, were organized with the best of faculties from India and abroad during the year. 19. Employee Welfare Your Company continues to extend welfare benefits to the employees and their dependants by way of comprehensive medical care, education, housing, and social security. Your Company continues to align company policies with changing economy and business environment. Employee Welfare Trusts - Your Company has established the following major Trusts for welfare of employees:- - Employees Contributory Provident Fund (ECPF) Trust, manages Provident Fund accounts of employees of your Company. - The Post Retirement Benefit Scheme (PRBS) Trust of your Company manages the pension fund of employees of your company. The Scheme was converted into a Defined Contribution Scheme as per DPE guidelines in November, 2013. In the converted Defined Contribution Scheme, the corpus in the individual employee account shall include employer/ employee contributions and interest thereon. The benefits under the scheme are dependent on corpus in the individual employee account and accordingly, would be market determined which depends on interest rate, annuity price etc. During FY 2016-17, 1940 cases of retired employees were settled amounting to Rs.8400 million. - The Composite Social Security Scheme (CSSS) formulated by your company provides an assured ex-gratia payment in the event of unfortunate death or permanent disability of an employee in service. In case of separation other than death/permanent total disability, employees own contribution along with interest is refunded. - Gratuity Fund Trust exists for payment of gratuity as per the provisions of the Gratuity Act. - Your Company has a Sahayog Trust for its Sahayog Yojana to provide ex-gratia financial grant for sustenance, medical assistance, treatment, rehabilitation, education, marriage of female dependent and alleviation of any hardship or distress to secure the welfare of the workforce and their kin, who do not have adequate means of support. The beneficiaries under this scheme include casual, contingent, daily rated, part-time, adhoc, contract appointees, tenure-based employees, apprentices and trainees employed by your Company besides regular and past employees. Under the scheme an amount of Rs.54.60 million was disbursed by the Trust during 2016-17. Extension of Benefits under the Asha Kiran Scheme to Retired Employees:- You Company has Asha Kiran Scheme to meet the emergency needs of the ex-employees retired prior to 01.01.2007, who are passing through distressful situation. The scheme was launched as per DPE guidelines by creating a corpus of 1.5% of PBT. During the year, under this scheme financial assistance of Rs.1,594.59 million was provided to 14,600 ex-employee as on 31.03.2017. Persons with Disabilities Your Company believes in affording equal opportunities to physically challenged people. As on 31.03.17, there were 245 permanent employees with disabilities (0.73%) on the rolls of your Company. Implementation of Govt. Directives for Priority Section Your Company complies with the Government directives for Priority Section of the society. The percentage of Scheduled Casts (SC) and Scheduled Tribe (ST) employees were 15 percent and 9.9 percent respectively as on 31st March, 2017. Your Company is fully committed for the welfare of SC and ST communities. The following welfare activities are carried out by your Company for their upliftment in and around its operational areas:- Annual Component Plan: Under Annual Component Plan for SC/ST, every year an allocation of Rs.200 million is made w.e.f. FY 2011-12. Out of this, Rs.60 million is distributed amongst all the work centres for taking up activities for welfare of SC/ST Communities in and around the areas of our operations. In addition, Rs.140 million is managed centrally, and is earmarked for special projects/proposals/schemes for the welfare of areas/persons belonging to SC/ST communities. The amount under component plan is utilised for taking up various welfare measures for the welfare and upliftment of the needy people of SC/ST Communities. This fund is especially meant for providing help and support in Education and Training, Community Development and Medical and Health Care. Scholarship to SC/ST meritorious students for pursuing higher professional courses at different Institutes and Universities in the country. Your Company provides 500 scholarships for meritorious SC & ST students for pursuing higher professional courses at different Institutes and Universities across the country in Graduate Engineering, MBBS, PG courses of MBA and Geo-Sciences. The major feature of the scheme is that the scholarships have been equally divided for both boys and girl students and the amount of scholarship has been made @ Rs.4,000/- per month amounting to Rs.48,000/- per annum per student subject to the conditions of the scheme. The financial implication involved in a cycle of four years with 500 scholarships awarded every year is around Rs.76 million per annum. 20. Industrial Relations During the year your Company maintained harmonious Industrial Relations throughout the Corporation. Mandays loss due to internal industrial action was reported as 'NIL' for the year 2016-17. 21. Grievance Management System A structured four-tier Grievance Management System in place in the Company to address employee grievances related to policy/policies. The channel of grievance is Reporting Authority of Individual, Sectional in charge, Key executive, Appeals Committee. Appeals Committee has outside professionals as members and empowered to suggest measures to prevent similar grievances in future. CMD takes the final decision in totality on the grievance of the employee with inputs from Director (HR). For external stakeholders, the Company has a well laid down grievance redressal system in place with adequate provisions to escalate the matters up the hierarchy up to the Board (Stakeholders Relationship Committee - a Board level Committee headed by an independent Director). Your Company voluntarily facilitates resolving grievances through Independent External Monitors (IEMs) and through Outside Expert Committee (OEC). Further, a separate website is maintained for grievance redressal (https:// grievance.ongc.co.in). 22. Implementation Under the Right to Information Act -2005 An elaborate mechanism has been set up throughout the organization to deal with requests received under the RTI Act, 2005. A Nodal Officer in the rank of a General Manager has been appointed for the purpose who is based at the Registered Office at Delhi. Besides this, 22 Central Public Information officers (CPIOs) have been designated at different work centers across the country in compliance of Sections 5(1) and 5(2) of the Act. Further, an Officer of the level of Executive Director has been appointed to discharges the role of an Appellate Authority under the Act. The particulars of all the quasi-judicial authorities under the ambit of RTI Act, 2005 have been uploaded on the ONGC Corporate portal (www.ongcindia.com ) for wider information of the general public. A total of 123 RTI applications were carried forward from the year 2015-16. Further, 947 applications were received during the period from April, 2016 to July, 2016 before migration to the RTI online system. A total number of 1397 applications were received during the period from August 2016 to March 2017; making a total of 2344 applications. Out of these 2244 applications were replied to during the year. Additionally, the Department of Public Information/RTI Cell also processed 169 Second Appeals which were listed for hearing at the CIC during the FY 2016-17 and took follow-up actions to dispose off the same. 23. Implementation of Official Language Policy Your Company makes concerted efforts to promote Official Language. In this regard, some of the steps taken during the year were: - - Unicode Hindi software installed in all our offices. - Hindi workshops conducted at regular intervals. - Hindi Technical seminars, 'Kavi Gosthies' and Hindi plays organized at various work centres. - Vishwa Hindi Diwas (10th January) celebrated at various work centres of ONGC. - Hindi Teaching Scheme of Govt. of India effectively implemented at all regional work centres. 24. Women Empowerment Women employees constituted over 6.6 percent of your Company's workforce. During the year, programmes on women empowerment and development, including programmes on gender sensitization were organized. Your Company actively supported and nominated its women employees for programmes organized by reputed agencies. Disclosure under the sexual harassment ofwomen at workplace policy (prevention, prohibition & redressal) Act, 2013 The Company has in place an Anti-Sexual Harassment Policy in line with the requirements of the sexual Harassment of Women at the Workplace (Prevention, Prohibition & Redressal) Act, 2013. Internal Complaints Committee (ICC) has been set up to redress complaints received regarding sexual harassment. All employees (permanent, contractual, temporary, trainees) are covered under this policy. The following is a summary of sexual harassment complaints received and disposed of during FY'17: - No. of Complaints received: 02 - No. of Complaints disposed of: 02 25. Work-Life Balance Your Company continued in its endeavors to ensure work-life balance of its employees. The townships at many work-centers were provided facilities like gymnasiums, music rooms, etc. Outbound programmes with families were also organized at various work-centers. Plays on the importance of 'Work-Life Balance' were staged to create awareness amongst the employees. In addition, cultural programmes involving employees and their families were also conducted. Mahila Samitis and Resident Welfare Associations (RWAs) were involved in the organization of these cultural programs. Your Company has an adventure wing named 'ONGC Himalayan Association' which organizes adventure programmes like mountaineering, trekking, white water rafting, snow skiing, desert safari, aero sports etc. which adds towards morale, engagement, team-spirit, camaraderie, stress management and spirit to explore unknown traits among the employees. 26. Sports Your Company continued its large scale support for development of sports in the country in the form of job offers and scholarships to deserving sportspersons. Sponsorships to various sports associations / federations / sports-bodies to organise sports events as well as develop infrastructure were also extended. Your Company extended support in 23 game disciplines to 166 players on regular rolls and 201 players on scholarship. The support has enabled many sportspersons to achieve and bring home laurels for the nation and the organisation. Some of the key achievements during the year are given below: - Five ONGCians were conferred the prestigious "Arjuna Award" for the year 2016 namely Shiv Thapa (Athletics), Amit Kumar (Wrestling), Sourav Kothari (Cue Sports), Sandeep Singh Maan (Athletics (Para)) and Rajat Chouhan (Archery). - Cricketer Virat Kohli, was conferred the prestigious "Padam Shri Award" for the year 2016. The total number of National Awardees in the organization stand at 31 (Khel Ratna - 1, Padma Shri - 3 & Arjuna - 27) - In Rio Olympics 2016, 7 ONGCians namely Ms. Kavita Raut (Marathon), Ms. M.R. Poovamma (4x400m relay Athlete), Ms. Ashwini Ponnappa (Doubles Badminton), Ms. Heena Sidhu (Shooting), Shiva Thapa (Boxing), Ms. Jisna Mathew (Scholarship 4x400m relay Athlete) and R. Mohan Kumar (Scholarship 4x400m relay Athlete) participated. - Shri Pankaj Advani won 16th world title in cue sports. In the year 2016-17 he won World Billiards title in point format and also in 6 Red Asian Snooker. - Shri Dhruv Sitwala won his 2nd Asian Billiards Title in April 2016. - ONGCian Shri Virat Kohli has been appointed as Indian Cricket team's captain in all match format i.e. Test, One Day & T-20. - Shri Pranaav Jerry Chopra of ONGC won Syed Modi GP Gold Badminton Tournament title in the year 2016-17. - Two Kabaddi players namely Jasvir Singh and Scholarship holder Sandeep Narwal won World cup kabaddi Championship in the year 2016-17. - 5 scholarship players namely Mandeep Singh, Gurjant Singh, Sumit, Simranjeet Singh & Vikramjit Singh secured Gold medal at Junior World Hockey Cup as a member of Indian team in the year 2016-17. - ONGC Scholarship Athlete Ms. Jisna Mathew (400 mt) and Ajay Kumar Saroj (1500mt) won Gold medal in Asian Jr. Athletics Championship in 2016-17. 27. Corporate Social Responsibility (CSR) Your Company as a responsible corporate has always been committed towards creating a conducive environment to bring about an inclusive growth in the society. The Company is fully engaged in ensuring equitable and sustainable growth specially in the area of its operations besides complying with government directives to discharge its social responsibility as a leading Indian corporate. It is for the first time in the history of the company that the CSR expenditure has exceeded Rs.5,000 million and funds required for continuing with some of the Projects in the next fiscal year is Rs.4,010 million. Out of the total CSR budget of Rs.5,356.66 million for the year 2016-17, the expenditure is Rs.5,259 million, which includes, additional overhead expenditure of Rs.87.4 million towards salary of officers/ personnel dealt with CSR on full time basis. This translates to overall utilization of 98.18% of the CSR budget. Rs.97.66 million are unspent during the year FY 2016-17. CSR activities of the company are guided by project based approach in line with the provisions of Companies Act 2013 promulgated by Ministry of Corporate Affairs. Necessary CSR & SD Policy has been framed and put in place in line with Companies Act 2013. A separate report on Corporate Social Responsibility (CSR) activities undertaken by your Company during the FY'17 is enclosed as Annexure 'C'. Reason for non-utilization of CSR budget: Around 98.18 % of CSR budget has been spent during the financial year 2016-17 wherein major PAN India CSR initiatives and work centre specific projects have been implemented successfully. Major flagship CSR projects have a project duration of more than one year with milestone based payment spread in different fiscals. Additionally, a number of CSR projects were in the formulation and approving stage. Against the carry forward budget of Rs.15,209 million from balance of CSR unspent funds of previous years, Rs.7,111.60 million has been committed as on date towards these various ongoing projects and projects under approving stage. Expenditure against these will be met in the financial years 2017-18 onwards. Major emphasis was laid towards taking up various projects under Swachhata Programme and these concerted efforts resulted in an expenditure of Rs.1,542.30 million for such projects during the year 2016-17 across the country. With a view to create health infrastructure the company contributed Rs.801.60 million and Rs.2,001.80 million towards different type of education & skill development related projects. Apart from Health and Education, project worth Rs.748.50 million have been implemented in North Eastern Region, Rs.113.20 million was spent towards projects for empowerment of women and project worth Rs.152.90 million were undertaken for welfare of SC/ST. Board of Directors take pride in reporting the brief details of the important CSR projects implemented during the year 2016-17: (a) Healthcare Initiative: i. Multi-Specialty Hospital at Sivasagar: The 362 bed Multi-Specialty Hospital at, Sivasagar is the largest ever CSR project to be undertaken by your company. The hospital will be developed in three phases at a cost of Rs.3,123.4 million. Dr Babasaheb Ambedkar Vaidyakiya Pratishthan (BAVP) will be the Construction, Operating and Management (COM) partner for this project. MOA has been signed with BAVP on 10th March 2017. The prime objective of the hospital is to provide quality health care services to the people of Northeast at an affordable cost. The charges for treatment will be as low as 70% of the market price and further discount of 50% will be provided to economically disadvantaged people. The phase wise medical facilities and the timeline are as follows: Phase Phase-I Phase-II Phase-III Total Cost (Rs. in million) 990.7 960.5 1,172.2 3,123.4 Number of Beds 100 120 142 362 Medical Facilities Internal Medicine Paediatrics General Surgery ENT Orthopaedic Gynaecology & Obst Pulmonary Medicine Ophthalmology Cardiolog y Cardiac Surgery Gastroenterolog y Nephrology Urology Neurology Neurosurgery Paediatric Surgery Surgical Gastroenterology Plastic & Cosmetic Surgery Renal Transplant IVF Endocrinology Surgical Oncology Medical Oncology Radiation Timeline July 2019 July 2021 July 2023 ii. Varisthajana Swasthya Sewa Abhiyan: This flagship CSR project of the Company has succeeded in providing 1.921 million door step medical treatment to 63797 elderly citizen through Medical Mobile Unit in the operational areas of ONGC in last six years at a cost of Rs.164.5 million. Considering the number of elderly citizen being benefited through this project, 11 new MMUs were initiated in the year 2016-17 in addition to the existing fleet of 20 MMUs for serving the community in the remote areas for the next three years at a cost of Rs.199 million. Help-Age India is the implementing agency for this project. The total amount sanctioned for this project till 31.03.2017 is Rs.363.4 million (for 9 years, since 2010) iii. Lady Goschen Hospital : Your Company has undertaken this CSR initiative for construction of new 'ONGC-MRPL Wing' for Government Lady Goschen Hospital, Mangalore with financial support of Rs.127.8 million. Lady Goschen Hospital was established in 1849, at the heart of Mangalore City. This hospital is exclusively dedicated to the women patient. Women from Karnataka and others areas ofKonkon region are largely dependent on this hospital for their treatment. On an average the hospital had to deal with 500 to 600 deliverer cases. Due to increase inflow of patients there was an urgent need for additional facilities. The new ONGC-MRPL wing of the hospital will address the long standing need of the women patient of the region. The hospital is schedule to be commissioned in August 2017. MRPL has also contributed Rs.88.9 million towards this project. iv. Integrated Muscular Dystrophy Rehabilitation Centre (IMDRC) at Solan: Your Company is supporting Indian Association of Muscular Dystrophy is setting up an Integrated Muscular Dystrophy Rehabilitation Centre' (IMDRC) at Solan, Himachal Pradesh at a cost of Rs.6.6 million. v. Eye-Care Initiative: Your Company has undertaken eye-care initiative for the benefit of both adult and children with two different NGO's namely Anugraha Drishtidan and Praani. While Praani specifically aims at undertaking screening and eye treatment for school going children ofNC R region whereas Anugraha Drishtidan focuses on eye treatment ofadult population near Company's operational area of Assam, Jharkhand and Andhra Pradesh. Through both these programs more than one lakh people have been benefited. The project includes screening, providing medicine, spectacles and cataract operation. vi. Health Care Initiative in Arunachal Pradesh: Your Company is working towards improving the health care facilities in the remote hilly areas of Arunachal Pradesh. In the last one year the Company had provided support for: I. Ambulance, ultra-sound and X-Ray machine for District Government Hospital Ziro II. Ambulance and Medical equipment for Community Health Center, Basar (West Siang) III. Medical equipment and hearse van for Government Hospital Aalo, IV. Ambulance for Govt. hospital Tawang. V. Medical equipment's for District. Govt. Hospital Tezu. The total financial implication for all these project is Rs.16.8 million. vii. Indian Menopause Society: Your Company has supported to Indian Menopause Society towards undertaking Urogynaecological Surgeries. These surgeries were performed by organizing three mobile surgical camps at Herbetpur, Uttrakhand, Raxaul, Bihar and Manali, Himachal Pradesh for the benefit of the underprivileged women who otherwise remain deprived from getting medical facilities. Some of the surgeries which cannot be performed in remote location are operated in a Hospital in Delhi. More than 90 such surgeries are carried out through this project. The total cost of this project is Rs.983 million (b) Promoting education Skill Development and livelihood enhancement Your Company's initiatives promoting education covers a wide range of subject from promoting Sanskrit language to setting up B. Ed. College for improving the literacy rate of Arunachal Pradesh. It has undertaken various projects which contribute towards promotion of education, skill development and enhancement of livelihood. Some of the major initiative in the field of education and skill development are: i. Setting up of B. Ed. College: With an objective to improve the literacy rate of Arunachal Pradesh, your company is setting up a B. Ed. college at Nirjuli, Arunachal Pradesh in association with Vivekanand Kendra Vidyalaya Arunachal Pradesh Trust at a cost of Rs.59 million. The college will be imparting training to more than 200 students in a year in B. Ed. and shall also conduct other in-house training activities. ii. ONGC Super 30: Your Company has set up a Super 30 center at Sivasagar to train 30 aspiring students to get admission in IITs and other premier engineering institutes of our country. Two batch had already completed the course successfully since 2014 with financial implication of Rs.13.2 million The 3rd batch of 30 students for the year 2016-17 is currently undergoing training with the financial implication of Rs.6.33 million. The project is being undertaken in partnership with Center for Social Leadership. iii. Establishment of Indian Institute of Petroleum and Energy (IIPE), Visakhapatnam: In order to establish IIPE, Vizag which will primarily focus on teaching and research in Petroleum and Energy, your company has contributed Rs.600 million to IIPE, Vizag towards corpus/ Endowment fund for establishment of Indian Institute of Petroleum and Energy (IIPE), Visakhapatnam, Andhra Pradesh. iv. Promotion of Sanskrit Language In order to revive the Sanskrit language, your company has taken up this initiative through Sanskrit Promotion Foundation with a total financial implication of Rs.50 million. This project includes development of online tools & tutorials for students, teachers and guardians at formal and in-formal school levels. It also involves workshops, seminars, leadership programme, technology orientation programme, continuous learning programme to the teaching community. Research on Sanskrit education, nationwide survey, and data collection, translation of contemporary literature in Sanskrit including children's literature and editing and publications of rare manuscripts etc., are the other highlights of the project. This Project is a step-forward towards the revival of Sanskrit in India and abroad. v. ONGC's Support for S-VYASA University, Bangalore: Your Company has supported 'Vivekananda Yoga Anusandhana Samsthana' (VYASA) by granting Rs.120 million towards construction of a 350 bed boy's hostel at S-VYASA University campus located at Gidden Halli, Jigani Hobli, Bangalore. The hostel will have all the latest facilities including solar lights, solar heating system, CCTV, lift, interior furniture, electrical, etc. Free accommodation will be provided to ST/SC and Tribal students of S-VYASA University whereas deserving poor students will be given 50% concession vi. Ekal Vidyalaya: Your Company has joined hands with Bharat Lok Shiksha Parishad for reaching remote villages in different parts of the country in order to provide free education to children through 'Ekal Vidyalaya'. The beneficiaries are the poor children in 6 to 14 years age-group who do not have access of education. The classes are being conducted in these Vidyalayas by a local educated youth who has minimum education of metric level and trained by team of experts. This project covers 420 Ekal Vidyalayas in as many villages of rural, tribal and backward areas in 10 states. After the completion of the 1st year in November 2016, the project has entered the 2nd year of implementation. vii. Job Oriented Computer Training and soft skills development for students mainly belonging to the weaker sections of Society: Your Company in association with Bharatiya Vidya Bhavan (BVB) has undertaken a project titled, "Free Job/ Entrepreneurship Oriented Computer education and soft skills development for students mainly belonging to the weaker sections of Society". This project provides free computer education is through BVB's Gandhi Institute of Computer Education and Information Technology, (GICEIT) at five work centers located at Mehsana, Dehradun, Nazira, Karaikal and Rajahmundry. These centers have been named as "ONGC-GICIET" centers. The project started in the year 2010-11. The total cost of the project is Rs.100 million. During the year 2016-17, an amount of Rs.30 million has been released towards implementation of this project and more than 5500 students have been trained in computer literacy and soft skill through five centers. viii. Green Hub Project: This is an unique initiative to train 20 youth of North East every year in wildlife videography and documentation. The Green Hub project is implemented in partnership with North East Network. The main objective of the project is to create a team of environment enthusiast having expertise in conservation. In the last two year 40 youth has been trained. The Centre has recently been conferred with Manthan Awards in the category of Environment & Green Energy for leveraging the power of youth to conserve biodiversity through a digital platform. The total cost of the project for two years is Rs.3.94 million. ix. ONGC ISKON Skill Development Center: Your Company in partnership with Bhaktivedanta Gurukula and International School, an educational wing ofISKCON has set up a Vocational Education Centre at Ajhai, near Vrindavan, in Mathura at a cost of Rs.80 lakhs. The Company's Centre for Skill development will be exclusively for imparting training in electrician, carpentry (wood), organic grower, hand embroidery and self-tailor. x. Skill Development through CIPET: The project is for job oriented technical skill development training on plastic processing & manufacturing in tool room mechanic operator and injection molding machine operator. 120 no. of youth would be identified through transparent selection procedure who would be trained by CIPET. The youth from the State of West Bengal, Odisha and North Eastern will be benefitted from the project activities. The total cost of the project is Rs.8.28 million. xi. Water Hyacinth Craft: 50 Women of Sivasagar district in Assam are being trained in Water Hyacinth Craft by a team of professional from North East Development Financial Corporation Ltd. Out of the fifty women, 20 women have been selected to undergo advance training program through National Institute of Design, Ahmedabad. All these women will become expert in designing craft made of water hyacinth which are in high demand in North East. The total cost for undertaking this training program is Rs.3.2 million. xii. Skill Development Program for Girls ofJammu & Kashmir: This CSR project is for training of 60 Kashmiri girls of Baramulla region of Jammu & Kashmir in Fashion Designing course through RICHA in association with Chinar 9 Jawan Club (Indian Army). These girls are chosen from Baramulla and nearby areas. The total cost of the project is Rs.1.65 million. The project will be for a period of one year. (c) Adoption of Monuments and iconic places 1. Restoration of Kunds in Varanasi: Your Company has undertaken a flagship initiative for restoration and beautification of four ancient Kunds of Varanasi. Work is in advance stage of progress in three Kunds having historical importance i.e Durga Kund, Lakshmi Kund and Lat Bhairav Kund. An amount of Rs.114.6 million was allocated towards implementation of this project. The project is being undertaken through M/s National Buildings Construction Corporation Ltd. with active support from Nagar Nigam Varanasi. The renovation and beautification of Kunds are near completion. ii. Cleanliness drive at Tirumala Tirupati Devasthanams (TTD), Tirupati: The Company's Board has approved an amount of Rs.149.5 million towards undertaking various cleanliness initiatives at Tirumala, which includes setting up of solid waste management plant, laying pipeline for utilization of recycled water, deployment of eco-friendly vehicle and equipment for waste disposal & cleaning, etc. iii. Beautification of Park near Jantar Mantar: This is a proactive CSR initiative of your Company towards 'Rejuvenation/Beautification of Park adjacent to Jantar Mantar'. The project was implemented through Indian National Trust for Arts and Cultural Heritage (INTACH), Delhi Chapter. The total cost of the project is Rs.7.77 million. iv. Green Rameshwram Project: The 'Green Rameshwram' project is another unique project of your Company implemented in association with Hand in Hand India in 4 wards of Rameshwaram Municipality, Tamil Nadu. The objective of the project is to improve Solid Waste Management System through door-to-door garbage collection, effective waste segregation, waste recycling / processing, using modern technologies like GPS, behavioural change in households / commercial establishments / waste pickers / local bodies through various IEC activities and sustainable financial model through user charges. Your Company has extended financial support of Rs.6.72 million for two years. (d) Ensuring Environmental Sustainability and Ecological Balance i. Eastern Swamp Deer Conservation project: Your Company implemented the project for conservation of Eastern Swamp Deer in Kaziranga in partnership with Wild Life Trust of India and Department of Environment & Forest, Govt. of Assam. Currently, the project is in the third phase of implementation. After the initial research work undertaken in the first phase to understand the habitat and different traits of Eastern Swamp deer, 19 Swamp Deers were translocate to Manas National Park from Kaziranganga National Park in the second phase. In Phase III another 17 eastern deer swamp deer were trans-located from Kaziranga National Park in the month of Feb 2017 to Manas National Park, creating an alternate breeding ground for the Eastern Swamp Deer other than Kaziranga National Park. An amount of Rs.22.65 million, has been sanctioned towards implementing the three phases of this project. ii. Statue of Unity at Gujarat: The project aims at building 182 meters (392 feet) tall, the World Largest Statue of Sardar Vallabhbhai Patel at the Sadhu Bet Island, approximately 3.5 kms south of Sardar Sarovar Dam at Kevadia in the Narmada district of Gujarat. The monument will have development oriented Initiatives like Development of banks of River Narmada up to Bharuch, Clean Technology Research Park & Agriculture Training Centers, Schools, colleges and universities for tribal development, Education Research Centre and Knowledge City etc. The project activities will boost tourism and facilitate development in the surrounding tribal areas. Your Company has supported 'Sardar Vallabhbhai Patel Rashtriya Ekta Trust' with financial support of Rs.500 million towards this project. iii. Pradhan Mantri Ujjwala Yoj ana (PMUY): This project is being implemented as per the directives of Ministry of Petroleum & Natural Gas (MoPNG) wherein your company has contributed 20% of its CSR budget for providing new LPG connection to BPL families free of cost. This project aims at environment sustainability and social upliftment by providing smokeless clean fuel in rural/underserved areas so that standard of life in rural areas improves and dependency on fire wood reduces in these areas of the country. In the year 2016-17 your Company has contributed Rs.1,071.3 million towards this initiative, which has been implemented by IOCL. iv. Ringal Plantation in Upper Himalayas: Your Company being responsible organization for protection of environment has always given great importance to tree plantation not only at its operational work areas but also in the areas outside its work center, with emphasis on survival ofplanted saplings. Your Company undertook an initiative for tree plantation in Uttarakhand on a proposal submitted by Uttaranchal Bamboo and Fiber Development Board (UBFDB), an autonomous organization under the Forest Department, Govt. of Uttarakhand. This plantation drive had carbon sequestering potential, water recharge and soil conservation capacity. It has provided livelihood to rural community of Uttaranchal living at 5000 - 6000 feet above sea level. Till 31.03.2017 plantation is done in 430 hectares resulting in 1.97 million tonnes of CO2 fixation/annum. v. Harit Moksha: Green Cremation System: This is a unique CSR initiative of your company undertaken with Mokshda Paryavaran Evam Van Suraksha Samiti (MPEVSS) to reduce wood consumption during traditional cremations through Mokshda Green Cremation Systems (MGCS). The ongoing project commenced in 2010 includes installing 30 units of green cremation system in 8 cities of7 different states with a budget of Rs.91.9 million. The project was successfully completed and helped in saving approximately 13,700 tonnes of wood & reduced 26,500 tonnes of GHG emissions annually till date. Considering the impact of this project, 4 new units has been approved in FY 2016-17, for installation of one unit at Pilhibit and 3 unit at Delhi at a cost of Rs.13.8 million. vi. Solar Lights: More than 4900 numbers of Solar Street Lights have been installed in the states of Andhra Pradesh, Rajasthan, Gujarat, Punjab, Rajasthan, Tamil Nadu, Telangana, Uttar Pradesh, Uttrakhand and Jharkhand availing services of MNRE Channel partners empanelled under rate contract at a total financial implication of Rs.98.2 million. e. Swachh Bharat Abhiyan i. Information, Education, Communication program: Your Company is the only company to initiate Information, Education, Communication (IEC) activities in 5592 school across India. After the successfully completing the construction of toilets under Swachh Vidhyalaya Abhiyan , the Company has taken a step forward by carrying out School Led Total Sanitation (SLTS) initiative through Aroville Foundation in all 5592 school across India. The project aims at the behavioural and habitual changes among the students and local public. An amount of Rs.70 million is earmarked towards implementing this project. Operation & Maintenance of the school toilets through community/ parents, teachers association has been established in 3003 schools by 31.03.2017 and efforts are under progress in other schools. ii. Open Defecation Free Initiative: Your Company has undertaken an initiative for making villages near its operation area Open Defecation Free (ODF). In the last one year more than 3540 Individual House Hold Latrine (IHHL) had been constructed in the operational areas at cost of Rs.64.2 million. Besides project worth Rs.106.8 million has been approved for construction of 7749 IHHL in Assam. iii. Swachhata Initiative of ONGC reaches Himalaya: Your Company is one of the first company to take the Swachh Bharat initiative to the Himalaya. The project is implemented in partnership with Indian Mountaineering Foundation (IMF) through which tons of garbage's are brought down from the high altitude mountain ranges of Uttarakhand. Specialized trained mountaineers are engaged to carry out this task. In the last two years the Company had undertaken the following Swachhata initiative in different mountain ranges of the Himalayas with IMF at a cost of Rs.5.22 million. (Rs. in Million) Duration Mountain Ranges covered Project cost (Rs.) Aug -Sept 2015 Peak Stok Kangri in Ladakh, Shigri Glacier Region, Spiti Valley, Tapovan, Gangotri Region, Pindari Area in Uttarakhand Himalaya 1.82 May 2016 and Oct 2016 Gaumukh, Tapovan, Nandanvan and Gangotri 1.44 Jan-Feb 2017 Chanshal Valley, Dhauladhar Range, Yamunotri, Anini / Mechuka (Arunachal Pradesh) 1.96 iv. Community Toilets at Dharavi: To address the sanitation problem in the slums of Dharavi (Mumbai), your Company has implemented a project for construction of five community toilets at a cost of Rs.7.72 million. This project is being implemented through Sulabh International Social Service organization. v. Mobile Water ATM: This project is for provision of clean drinking water for the local population and tourists of Lucknow through Mobile Water ATM. The project has a dual benefit. First, the project has helped in provision of clean and safe drinking water for the local population and tourists in Lucknow. Secondly, the project has helped 7 Person with Disability (PwD) earn livelihood by operating these Mobile Water ATM. All seven mobile water ATM's are operated by PwD, who collect the water from a centralized RO plant and sell them to on-the-go commuters in various location of Lucknow at a very nominal cost. The project is undertaken in association with Margdarshak at a cost of Rs.1.97 million. Decentrik Technologies (DT) who has developed this innovative Water ATM technology is the technical service provider of the project. vi. Deep Water Tube Wells: The project for installation of six deep water tube well through National Consumer Cooperative Federation in six different locality of Kamrup district of Assam in under implementation. The locations has been identified in consultation with district administration where there is acute problem of clean drinking water. vii. Hand Pumps: More than 400 hand-pumps are installed across different location of the country. The project locations are identified based on need, where there is scarcity of drinking water. An amount of Rs.23.6 million has been earmarked for installation of these hand pumps. f. CSR initiatives exclusively for benefit of SC-ST and tribal population: Efforts have always been made by your company towards identification and implementation of CSR projects meant exclusively for the benefit of SC-ST in the country. Implementation of such projects has never been restricted to operational areas of the Company alone. Project worth Rs.152.9 million are implemented during the year 2016-17 for the same. Besides, as per the bilateral understanding with AISCSTEWA, an amount of Rs.155 Million is allocated towards 1000 merit scholarship for a period of 4 years commencing from 2016-17 exclusively for the benefit of students belonging to ST/SC. Some of the other major CSR initiative for the benefit of SC/ST and Tribal community are: i. Development of Model Village at Korbongpara: In Tripura, your company in partnership with Tripura Engineering Society (TES) has contributed towards development of Model Village at Karbongpara under Champabari ADC village ofJirania Block, West Tripura District with a total project cost of Rs.6.6 million. The Karbong community of Tripura with 120 inhabitants and low literacy rate is on the verge of extinction. They are deprived of basic needs and belong to the weakest section of society. Under this project, it is planned to develop the said village into a selfsustained model village which includes developing the infrastructural facilities like community centre, sanitation, drinking water facilities, irrigation, market shed, internal road connectivity, education, healthcare, income generation to support the livelihoods. ii. Multi-Purpose Skill Development and Community Centre at Natun Jelom: Your Company, under Sansad Adarsh Gram Yojna supported for construction of Multipurpose Skill development and community center at Natun Jelom, Jonai in Dhemaji district of Assam at a cost of Rs.4 million. More than 98% of Natun Jelom population belongs to ST community. iii. Infrastructure development of Rongagora Junior College: This project was implemented under ST/SC component plan for construction of Rongagora Junior college at Golaghat at a cost of Rs.2.69 million. iv. Construction of Community Hall and Schools: Your Company has supported construction of three community center, one school building, 12 unit of school toilets and 8 teachers quarter at West Siang District of Arunachal Pradesh at a cost of Rs.10.4 million. The majority of the population of these villages belongs to ST community. v. Infrastructure development of school and hostel: Your Company in partnership with Kalyan Ashram Tripura has undertaken an initiative for construction of Ratnamani Sishu Siksha Niketan School and hostel building at Kanchancherra, Tripura with an estimated cost of Rs.3.5 million which will provide hostel facilities to the tribal students and access to healthy educational environment. g. Promotion of Sports: i. Chau Lung Syukapha Indoor Stadium. The Chau Lung Syukapha Indoor Stadium, constructed in Sivasagar with funding from your company is one of the major sports infrastructure development project undertaken under CSR. The stadium is constructed at a cost of Rs.15.2 million, which is going to help the budding young sportsmen of Sivasagar and other district of Assam. ii. Training of Indian Wrestlers: Your Company has contributed Rs.11.5 million to Wrestling Federation of India towards development of wrestling in India. 28. Accolades Consistent with the trend in preceding years, your Company, its various operating units and its senior management have been recipients of various awards and recognitions. Details of such accolades are placed at Annexure- 'D'. 29. Directors' Responsibility Statement Pursuant to the requirement under Section 134(3)(c) of the Companies Act, 2013, with respect to Directors' Responsibility Statement, it is hereby confirmed that: (i) In the preparation of the annual accounts, the applicable accounting standards have been followed and there are no material departures from the same; (ii) The Directors have selected such accounting policies and applied them consistently and made judgements and estimates that are reasonable and prudent, so as to give a true and fair view of the state of affairs of the Company as on 31st March, 2017 and of the profit of the Company for the year ended on that date; (iii) The Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013, for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities; (iv) The Directors have prepared the annual accounts of the Company on a 'going concern' basis. (v) The Directors have laid down internal financial controls which are being followed by the company and that such internal financial controls are adequate and are operating effectively. (vi) The Directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating. 30. Corporate Governance Your Company has taken structured initiatives towards Corporate Governance and its practices are valued by various stakeholders. The practices emanate from the need to position multi-layered checks and balances at various levels to ensure transparency of its operations in the decision making process. In terms of SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015, a report on Corporate Governance for the year ended March 31, 2017along with a certificate from the Company's Statutory Auditors confirming compliance of conditions forms part of this report. Your Company has implemented the mandatory Guidelines of Department of Public Enterprises (DPE), Government of India, on Corporate Governance to the maximum extent possible. Your Company has formulated and uploaded the following policies/codes on its website in line with the Companies Act, 2013 and Listing Regulations: (a) Code of Conduct for Board Members and Senior Management Personnel (b) Related Party Transactions - Policy & Procedures, 2014 (c) Material Subsidiary Policy (d) The Code of Internal Procedures and Conduct for prohibition of insider trading in dealing with the securities of ONGC (e) Corporate Policy on Materiality for Disclosure of events to the Stock Exchanges (f) Corporate Policy on Preservation of Documents and their archiving (g) Policy for Training of Directors (h) Dividend Distribution Policy In line with global practices, your Company has made available all information, required by investors, on the Company's corporate website www.ongcindia.com In line with the SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015, your Company has also implemented other measures of Corporate Governance (mandatory/voluntary) which have been brought out in the Corporate Governance Report and are as follows: i. Whistle Blower Policy/ Vigil Mechanism: A total of 40 Protected Disclosures till 31.03.2017 have been processed through the Whistle Blower mechanism of your Company which was implemented from December 01, 2009. The policy ensures that a genuine Whistle Blower is granted due protection from any victimization. The Policy is applicable to all employees of the Company and has been uploaded on the intranet of the Company. In addition, the Company has a full-fledged Vigilance Department, which is headed by Chief Vigilance Officer who holds the rank of a Functional Director of the Company. With a view to maintain his independence, the CVO reports to the Chief Vigilance Commissioner of the Government of India. ii. Enterprise-wide Risk Management (ERM) Framework: In line with the requirements of SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015, your Company has developed and rolled out a comprehensive Enterprise-wide Risk Management (ERM) Policy throughout the organization. The Audit & Ethics Committee periodically reviews the risk assessment and minimization process in ONGC. The Risk Management policy of your Company is as follows: "ONGC shall identify the possible risks associated with its business and commits itself to put in place a Risk Management Framework to address the risk involved on an ongoing basis to ensure achievement of the business objective without any interruptions. ONGC shall optimize the risks involved by managing their exposure and bringing them in line with the acceptable risk appetite of the Company" iii. Meeting of Independent Directors: Four Meetings of Independent Directors were held during FY'17. iv. Certificate of Independence by Independent Directors: The Independent Directors have submitted declaration that they meet the criteria of Independence as per section 149(6) of the Companies Act, 2013. 31. Statutory Disclosures Your Directors have made necessary disclosures, as required under various provisions of the Act and SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015. Extract of Annual Return As per requirement of section 92(3) of the Companies Act, 2013, the extract of the annual return in form MGT-9 is placed at Annexure-E. Particulars of Employees Your Company being a Government Company, the provisions of section 197(12) of the Companies Act, 2013 and relevant Rules do not apply in view of the Gazette notification dated 05.06.15 issued by Government of India, Ministry of Corporate Affairs. The terms and conditions of the appointment of Functional Directors are subject to the applicable guidelines issued by the Dept. of Public Enterprise, Government of India. The salary and terms and conditions of the appointment of Company Secretary, a KMP of ONGC, is in line with the parameters prescribed by the Government of India. 32. Energy Conservation The information required under section 134(m) of the Companies Act, 2013, read with the Companies (Accounts) Rules, 2014, is annexed as Annexure - 'F'. 33. Audit And Ethics Committee In compliance with section 177(8) of the Companies Act, 2013, the details regarding Audit & Ethics Committee is provided under Corporate Governance report which forms part of this Annual Report. There has been no instance where the recommendations of the Audit & Ethics Committee have not been accepted by the Board of Directors. 34. Auditors The Statutory auditors of your company are appointed by the Comptroller & Auditor General of India (C&AG) M/s. Dass Gupta & Associates, New Delhi, M/s. M K P S & Associates, Mumbai, M/s. Lodha & Co., Kolkata, M/s. PKF Sridhar & Santhanam LLP, Chennai, M/s. Khandelwal Jain & Co., Mumbai and M/s. K C Mehta & Co., Baroda Chartered Accountants were appointed as joint Statutory Auditors for the financial year 2016-17. The statutory auditors have been paid a total remuneration of Rs.43.41 million (previous year Rs.26.39 million) towards audit fees, certification and other services. The above fees are inclusive of applicable service tax but exclusive of re-imbursement of reasonable travelling and out of pocket expenses actually incurred. 35. Auditors' Report on the Accounts The comments of Comptroller & Auditor General of India (C&AG) form part of this Report and is attached as Annexure 'G'. There is no qualification in the Auditors Report on the Financial Statements of the Company. 36. Secretarial Audit In terms of section 204(1) of the Companies Act, 2013, the Company has engaged M/s P P Agrawal & Co., Company Secretaries in whole-time practice, as Secretarial Auditors for conducting Secretarial Compliance Audit for the financial year ended 31st March, 2017. The report has been annexed and forms part of the Annual report. 37. Cost Audit Six firms of Cost Accountants were appointed as Cost Auditors for auditing the cost accounts of your Company for the year ended 31.03.2017 by the Board of Directors. The Cost Audit Report for the year 2015-16 has been filed under XBRL mode on 23.09.2016 which was well within the due date of filing. 38. Directors Policy On Directors' Appointment Etc. Your Company being a Government Company, the provisions of section 134(3) (e) of the Companies Act, 2013 do not apply in view of the Gazette notification dated 05.06.15 issued by Government of India, Ministry of Corporate Affairs. Performance Evaluation The provisions of Section 134(3)(p) of the Companies Act, 2013 relating to evaluation of Board/ Directors do not apply to your Company since necessary exemptions are provided to all government companies. Further, similar exemption is awaited from SEBI under the provisions of Listing Regulations - 2015. Appointments / Cessation Etc Since the 23rd Annual General Meeting held on 08.09.2016, Shri Deepak Sethi, Shri Vivek Mallya, Shri Sumit Bose were inducted as Independent Directors of the Company with effect from 31.01.2017 and Dr. Santrupt B. Misra was inducted as Independent Director of the Company with effect from 06.02.2017. Shri A. P. Sawhney, Additional Secretary, MoP&NG, Government Nominee Director ceased to be Director on the Board of the Company w.e.f. 23.06.2017. The Board places on record its appreciation for his contribution during his tenure. Shri Rajiv Bansal, Additional Secretary, MoP&NG, joined the Board as Government Nominee Director on 10.08.2017 in place of Shri A. P. Sawhney. The strength of the Board of Directors of the Company is 16 comprising 7 Executive Directors (Functional Directors including CMD) and 9 Non-Executive Directors including two Government Nominees and seven Independent Directors. Ministry of Petroleum & Natural Gas has been requested to appoint requisite number of independent Directors including a woman Director to comply with the provisions of Companies Act, 2013 and Listing Regulations. A total of 13 meetings of the Board of Directors of ONGC were held during FY'17. Details of other Key Managerial Personnel as per Rule 8 (5) (iii) of the Companies (Accounts) Rules, 2014: Shri M. E. V. Selvamm took over as Company Secretary on 01.06.2017 in place ofShri V. N. Murthy who superannuated on 31.05.2017. 39. Acknowledgement Your Directors are highly grateful for all the help, guidance and support received from the Ministry of Petroleum and Natural Gas, Ministry of Finance, DPE, MCA, MEA, and other agencies in Central and State Governments. Your Directors acknowledge the constructive suggestions received from Statutory Auditors and Comptroller & Auditor General of India and are grateful for their continued support and cooperation. Your Directors thank all share-owners, business partners and all members of the ONGC Family for their faith, trust and confidence reposed in the Board. Your Directors wish to place on record their sincere appreciation for the unstinting efforts and dedicated contributions put in by the ONGCians at all levels, to ensure that the Company continues to grow and excel. On behalf of the Board of Directors Place: New Delhi (Dinesh K Sarraf) Date: 21.08.2017 Chairman & Managing Director