A PROJECT REPORT ON OIL AND NATURAL GAS CORPORATION LIMITED

SUBMITTED TO:
Priyanka Tailor

Submitted by:
Gajera Chetan Priti Patel Dipak Vora 15 16 17 117110592076 117110592194 117110592086

Table of Contents
SECTION 1 2 3 4 5 6 7 PARTICULAR Introduction of ONGC Mission and vision Human Resource Department SWOT Analysis of ONGC Competitors Porters Five Force Analysis BIBLIOGRAPHY PAGE NO

INTRODUCTION
The Oil and Natural Gas Corporation popularly known to the people as ONGC is todays No.1 gem among the Navratnas Public sector Companies of India. With a small beginning in 1956 as a division within the Geological survey of India for the task of exploration and exploitation of hydrocarbons (i.e. crude oil and natural gas), it attained the status of commission, to be called Oil and Natural Commission under the Ministry of Natural Resources in the same year. An Act of Parliament in October, 1959 converted the commission into a statutory body. ONGC soon spread its activities for search of oil and gas throughout the land of country from Gujarat in West to Assam in East and Jammu in North to madras in south by discovering oil and gas fields in innumerable locations. Thereafter ONGC diversified its search for hydrocarbons under the sea bed and discovered the gigantic Bombay High in 1974, located in Western Offshore of Bombay. Born over four decades ago in 1956 in a modest corporate house-Tel Bhawan within serene Himalayan setting at Dehradun, with strategic national objective to explore and exploit hydrocarbon resources of the country, ONGC since then has grown into a full fledged horizontally integrated upstream petroleum company with adequate in house capabilities and infrastructure in the entire range of oil and gas exploration and production (E&P) activities and related oil field and engineering services. ONGC today, is endeavoring to become a world-class oil and gas company in pursuit of E&P business in the domestic and international arena and related opportunity specific energy businesses. ONGCs principle business is Petroleum. At home they explore and produce oil and natural gas from acreages both on land and offshore in diverse logistics conditions, from rugged mountains to deserts and deep oceans. They have the requisite experience to explore and produce from Caustic, Carbonate and Fractured basement reservoirs from depths as deep as 5000 meters. ONGC is Indias largest producers of Crude Oil, Natural Gas and LPG. They also produce other value added products such as NGL, C2-C3, Aromatic Rich Naphtha and Kerosene.

ONGCS MISSION AND VISION

To be a world-class Oil and Gas Company integrated in energy business with dominant Indian leadership and global presence.

HUMAN RESOUREC DEPARTMAENT

The HR Department forms the foundation of any organization so is the case with Hazira gas processing complex. The HR department is headed by DGM (HR), who is assisted by other officers and staff. The HR Dept. of the corporation undertakes all those activities, which are concerned with its personnel. Its responsibility is to see that the corporations policies relating to personnel policies and procedures are carried out in an effective manner.

ALLOWANCES
House rent allowance Leased accommodation Self leased facility Drilling allowance Hard duty allowance Offshore compensation allowance Operational allowance Shift allowance Food compensatory allowance North eastern allowance Remote locality allowance Tribal area allowance Hill compensatory allowance Overtime allowance Kit maintenance allowance Washing allowance

TRAVELING ALLOWANCE
Local travel charges on tour Daily allowance Transfer TA Payment of TA on First appointment Reimbursement of taxi hire charges to inspection staff

RECRUITMENT
The recruitment in ONGC Hazira plant is done for two types of levels. 1. Executive level 2. Staff level The recruitment at executive level is done through a national level open recruitment test conducted at different centres all over India. While for recruitment of staff, test is conducted by various ONGCs plant individually at regional level.

METHOD OF RECRUTMENT
ONGC advertises the vacancies in the newspapers and displays the same online. Only the applications specific to the advertisements are entertained which are received during the time limit stipulated in the vacancy notification/advertisement. Individuals applications which are without reference to specific vacancy notification are neither entertained nor replied to. Broad terms and conditions and general instructions which are specific to the advertised posts are incorporated in the advertisements/vacancy notification. Vacancies are notified or advertised as and when there is manpower requirement for any discipline. The executives in ONGC are transferable to any of its Projects, Regions, Institutions and Workcenters in India or abroad.

SWOT ANALYSIS OF ONGC

STRENGTHS Fully integrated company in all the sectors of Oil and Gas businessExploration and Production ,Refining,Sales of crude Oil and Gas and Entry in retailing sector Market Leader in Oil and Gas Sector in India. Strong and Visionary Leadership. Strong financial position of the Company with huge Oil and gas Reserves. Existing Product of Value Added Products like Kerosene,Naptha,Diesel,etc. International and National Creditability as a firm of repute. Owns equity of Oil and Gas abroad. Has a subsidiary as MRPL,which has highest capacity utilization among all PSU refiners.

WEAKNESS Constraints of a PSU wherein many decisions to enter downstream energy sector are adversely affected. No major Oil and Gas find since Mumbai High. Manpower which is not accustomed to working in deregulated Oil And Gas Sector. Dated system and processes which are in process of change.

OPPORTUNITIES The progressive removal of price controls in the Oil and Gas sector are enabiling the company to generate financial surpluses for investment. The de- control in the Oil and Gas sector enables forward integration for ONGC and also for direct marketing of petroleum products. Entry into CBM, Gas hydrates, Underground Coal Gasification, etc to improve the availability of Gas for sale. Increase in Oil and Gas equity abroad through its overseas subsidiary, OVL. Entry into Energy sector through power generation.

THREATS Increased competitor activity in the Oil and Gas business in India and emergence of other integrated like RIL. Backward integration by Oil refining companies like IOCL, Gas and Power generating companies like GAIL and NTPC respectively. Limited availability of fossil reserves.

COMPETITORS
1. Bharat Petroleum Corporation Limited 2. INDIAN OIL CORPORATION LIMITED 3. HINDUSTAN PETROLEUM CORPORATION LIMITED 4. First PSU to market ATF abroad 5. Reliance Industries Limited 6. Essar Oil Limited

PORTERS FIVE FORCES ANALYSIS

Michael . E. Porter provided a widely used framework that models the industry as being influenced by five forces. The straight business manager seeking to develpop an edge over rival firms can use this model to better understand the industry context in which the firm operates. the five forces are: Internal rivalry Threat to substitutes Bargaining power of buyers Bargaining power of suppliers Threat to new entrants

The model is here used to analyze the existing and foreseeable competitive situation for ATF activities.

INTERNAL RAIVALRY The present ATF market in the country is characterized by the supply from the three OMCs. Airlines are required to purchase ATF from these Governmentcontrolled companies- IOC, HPCL and BPCL as they are the only companies which have been permitted to have facilities within airports. Currently, these government-owned all companies enjoy exclusive privilege over supply (domestic and imported) of ATF and control fuel hydrants and associated infrastructure located at the airports. For the supply of ATF, customers enter into contracts with these companies. The price charged by these companies is uniform and is revised every month based on the international price of crude oil. All the three government-owned oil companies continue to charge the same price. Furthermore, an examination of the fuel price at various points in the supply chain suggests that these companies may be overcharging at the expense of air carriers. The monopoly of government-owned companies in the supply of ATF is grossly incongruent with the ongoing process of liberalization in the oil sector but is changing as Government has started giving marketing rights to other companies like Reliance,Essar Oil Ltd., MRPL and ONGC. Presently the sector is arranged by swap arrangement by the OMCs and hence the internal rivalry is low but is bound to increase with opening up of the sector.

THREAT OF POTENTIAL ENTRANTS

This is low but is slated to be high with the easing of the regulatory framework Indian refining has been witnessing consolidation, with Oil marketing companies taking over standalone refiners .Indian Oil Corporation (IOC) gained strategic control over IBP Co. Ltd., while Oil and Natural Gas Corporation (ONGC) began implementing its plans for vertical integration by acquiring the majority stake in Mangalore refineries and petrochemicals Ltd. (MRPL) for the AVBirla group. The entry barriers are high in the industry due to huge level of capital investments , high asset specialty , etc. Hence the number of players in the business shall remain limited and oligopolistic conditions are likely to prevail. On the marketing front, competition has begun to increase.Private oil firm like Reliance has been able to grab a pie of the aviation refueling market so far at few airports where there is land to spare for more oil storage facilities. AAI is working out modalities to unbundled the aircraft refueling infrastructure, a move that has allowed private players like Reliance and Essar to enter the lucrative market ATF. Thus, the petroleum marketing sector, which is currently controlled by the three public sector unit (PSU) marketing companies, is becoming more competitive and is expected to gather momentum in the next few years as private participation increases. Despite the healthy demand, there will be an increase in ATF surplus. Going forward, capacity additions and the higher production of light and middle distillates will outplace the demand growth. ATF producers will start exploring in big way as the supply will grow at a CAGR of 10.0 percent from 2005-06 to 2010-11.

BARGANING POWER OF SUPPLIER The power of the suppliers i.e ONGC and Oil is limited as the IOC, HPCL and BPCL are supplied the crude from them at the fixed price of $45/bbl because of Government regulation. Crude imports are generally done through commercial agreements or contracts named as term contracts entered into by various Indian companies with National Oil Companies of Oil producing countries. Crude is also procured from open market on spot basis through tenders. Hence it is driven by international market prices and therefore limited power of suppliers. In the case of ONGC, ATF is being produced from the gas and condensate from the Mumbai offshore and hence is the forward integration of the E&P business.

BARGANING POWER OF BUYERS

The power of the buyers is limited and set to increase in the near future with the increase in number of ATF suppliers. If we consider the domestic airlines there are 9 buyers only, and they have access to the ATF supplied by the three OMCs who have the required infrastructure at all the airports. Hence they have to buy the ATF from these companies only. There is very limited scope for the buyers to vertically integrate into the refining business as entirely different competencies are required for the industry.

THREAT OF SUBSTITUTE There does not appear to be any threat of substitute fuel.

GOVERNMANT AND REGULATORY SETUP The biggest factor that can impact the Porters five force analyses is the government and the regulation. The impact on which has been analysed earlier. On the whole, though there is convergence of the views that the market economics will have freer end in the end. However, even the change in the pace of reforms has the potential to alter the dynamics of the ATF market in general.

Threat of Entrants Entry barriers are high due to high capital investment, etc. and Govt. regulations

Government and Regulatory setup

RIVALRY Little Rivalry at present but building up through case of Govt. Regulations Bargaining Power of suppliers Bargaining power of buyers

The threat is also limited as controlled by Govt. and international market

Threat of Substitutes There is no threat of the substitutes

The power of bargaining power of buyers the buyers is limited and is set to increase in the near future with the increase in number of ATF suppliers.

CONCLUSION

I have come to know about all the strengths and weaknesses of the plant. ONGC Hazira plant has started producing Aviation Turbine Fuel (ATF) from year 2005. There has a wide opportunity to produce more amount of ATF and subsequently do marketing of ATF in the market. Because aviation industry is booming and other private companies like Kingfisher Airlines, Jet Airways, Sahara Airlines, Air Deccan are expanding their market. Foreign airlines are also increasing their market in India. So there is unlimited demand in the future for ATF .

BIBLIOGRAPHY
P.c.Tripathy,Principlesof Management, 4th edition, Tata McGraw Hill, James A.F.Stoner, R.Edwards freeman, Daniel R. Gilbert, JR Management6th edition, pearson. Websites of ONGC, IOCL, Shell, CRIS INFAC www.petroleum.nic.in www.indianpetro.com BROCHURES OF ONGC