State-run Oil and Natural Gas Corporation (ONGC) has entered the specialised ethane transportation segment through a strategic partnership with Japan’s Mitsui OSK Lines (MOL), marking a significant expansion of its petrochemical supply chain.
Under the arrangement, ONGC and MOL will form two joint venture companies, each owning one very large ethane carrier (VLEC). The partners will hold equal 50% equity in both ventures, with the combined investment in the two vessels estimated at around $370 million. The ships are scheduled to begin operations by mid-2028, transporting ethane from the United States to ONGC Petro Additions Ltd (OPaL), ONGC’s petrochemical subsidiary.
The joint ventures—Bharat Ethane One IFSC and Bharat Ethane Two IFSC—will be headquartered in Gujarat’s GIFT City. ONGC will invest by subscribing to 200,000 equity shares of ₹100 each in both entities, while MOL will be responsible for operating the Indian-flagged vessels.
ONGC’s entry into ethane shipping is driven by the need to secure long-term feedstock supplies for OPaL. The company expects reduced availability of ethane-rich gas from Qatar in the coming years, as supplies are likely to shift towards lean gas with lower ethane and propane content. To bridge this gap, ONGC plans to import approximately 800,000 tonnes of ethane annually starting in 2028.
MOL brings extensive experience to the partnership, including the operation of LNG carriers for Petronet LNG and ethane carriers for Reliance Industries. The two VLECs will be constructed at shipyards in South Korea, reflecting the technical complexity of ethane transportation.
OPaL operates India’s largest dual-feed cracker, capable of processing both naphtha and gaseous feedstocks such as ethane, propane and butane. As part of its broader integration strategy, ONGC has previously invested around ₹1,500 crore in a gas extraction facility at Dahej, with a processing capacity of 4.9 million tonnes of LNG per year.
The collaboration is expected to enhance ONGC’s downstream integration by combining MOL’s global shipping expertise with ONGC’s feedstock sourcing and petrochemical operations, ensuring stable and reliable ethane supplies over the long term.
