Offering Circular - India INX

NOTICE

THIS OFFERING IS AVAILABLE ONLY TO INVESTORS WHO ARE OUTSIDE THE

UNITED STATES IN ACCORDANCE WITH REGULATION S (AS DEFINED BELOW).

IMPORTANT: You must read the following before continuing. The following applies to the offering

circular (the “Offering Circular”) following this page, and you are therefore advised to read this carefully

before reading, accessing or making any other use of the Offering Circular. In accessing the Offering Circular,

you agree to be bound by the following terms and conditions, including any modifications to them any time

you receive any information from us as a result of such access.

NOTHING IN THIS ELECTRONIC TRANSMISSION CONSTITUTES AN OFFER OF

SECURITIES FOR SALE IN THE UNITED STATES OR ANY OTHER JURISDICTION WHERE IT

IS UNLAWFUL TO DO SO. THE SECURITIES HAVE NOT BEEN, AND WILL NOT BE,

REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933 (THE “SECURITIES ACT”), OR THE

SECURITIES LAWS OF ANY STATE OF THE U.S. OR OTHER JURISDICTION AND THE

SECURITIES MAY NOT BE OFFERED OR SOLD WITHIN THE U.S., EXCEPT PURSUANT TO AN

EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION

REQUIREMENTS OF THE SECURITIES ACT AND APPLICABLE STATE OR LOCAL

SECURITIES LAWS.

THE OFFERING CIRCULAR MAY NOT BE FORWARDED OR DISTRIBUTED TO ANY

OTHER PERSON AND MAY NOT BE REPRODUCED IN ANY MANNER WHATSOEVER, AND IN

PARTICULAR, MAY NOT BE FORWARDED TO ANY U.S. ADDRESS. ANY FORWARDING,

DISTRIBUTION OR REPRODUCTION OF THIS DOCUMENT IN WHOLE OR IN PART IS

UNAUTHORISED. FAILURE TO COMPLY WITH THIS DIRECTIVE MAY RESULT IN A

VIOLATION OF THE SECURITIES ACT OR THE APPLICABLE LAWS OF OTHER

JURISDICTIONS. IF YOU HAVE GAINED ACCESS TO THIS TRANSMISSION CONTRARY TO

ANY OF THE FOREGOING RESTRICTIONS, YOU ARE NOT AUTHORISED AND WILL NOT BE

ABLE TO PURCHASE ANY OF THE SECURITIES DESCRIBED IN THE OFFERING CIRCULAR.

Confirmation of your Representation: The Offering Circular is being sent at your request and by

accepting the e-mail and accessing the Offering Circular, you shall be deemed to have represented to us that the

electronic mail address that you gave us and to which this e-mail has been delivered is not located in the United

States and that you consent to delivery of such Offering Circular by electronic transmission. The attached

Offering Circular is being furnished in connection with an offshore transaction as defined in the Securities Act

in compliance with Regulation S under the Securities Act (“Regulation S”).

You are reminded that the Offering Circular has been delivered to you on the basis that you are a person

into whose possession the Offering Circular may be lawfully delivered in accordance with the laws of

jurisdiction in which you are located and you may not, nor are you authorised to, deliver the Offering Circular

to any other person.

The materials relating to any offering of securities described in the Offering Circular do not constitute,

and may not be used in connection with, an offer or solicitation in any place where offers or solicitations are

not permitted by law. If a jurisdiction requires that the offering be made by a licensed broker or dealer and the

underwriters or any affiliate of the underwriters is a licensed broker or dealer in that jurisdiction, the offering

shall be deemed to be made by the underwriters or such affiliate on behalf of the relevant Issuer in such

jurisdiction.

As per the provisions of applicable Indian regulations, only investors that are compliant with the ECB

Investor Requirements (as defined in the Offering Circular) are eligible to purchase the Indian Issuer Notes (as

defined in the Offering Circular) issued by the relevant Domestic Issuer (as defined in the Offering Circular).

This Offering Circular is being sent at your request and by accepting the e-mail and accessing this Offering

Circular you shall be deemed to have represented to us that you meet the ECB Investor Requirements.

The Offering Circular has not been and will not be registered, produced or made available to all as an

offer document (whether a prospectus in respect of a public offer or an information memorandum or private

placement offer letter or other offering material in respect of any private placement under the Companies Act,

2013 or any other applicable Indian laws) with the Registrar of Companies of India or the Securities and

Exchange Board of India or the Reserve Bank of India or any other statutory or regulatory body of like nature

in India, save and except for any information from any part of this Offering Circular which is mandatorily

required to be disclosed or filed in India under any applicable Indian laws, including, but not limited to, the

Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations 2015, as amended, and

under the listing agreement(s) with any Indian stock exchange pursuant to the Securities and Exchange Board

of India (Listing Obligations and Disclosure Requirements) Regulations 2015, as amended, or pursuant to the

sanction of any regulatory and adjudicatory body in India. The Offering Circular or any other offering document

or material relating to the Notes has not been and will not be circulated or distributed, directly or indirectly, to

any person or the public in India or otherwise generally distributed or circulated in India which would constitute

an advertisement, invitation, offer, sale or solicitation of an offer to subscribe for or purchase any securities in

violation of applicable Indian laws for the time being in force.

The Offering Circular has been sent to you in an electronic form. You are reminded that documents

transmitted via this medium may be altered or changed during the process of electronic transmission and

consequently none of the Issuers (as defined in the Offering Circular), the Guarantor (as defined in the Offering

Circular), Citigroup Global Markets Limited (“Citigroup”), Standard Chartered Bank (Singapore) Limited

(together with Citigroup, the “Arrangers” and the “Dealers”) nor any person who controls each of them nor

any director, officer, employee nor agent of each of them or affiliate of any such person accepts any liability or

responsibility whatsoever in respect of any difference between the Offering Circular distributed to you in

electronic format and the hard copy version available to you on request from the Arrangers and the Dealers.

Actions that you may not take: if you receive this document by e-mail, you should not reply by e-mail

to this notice, and you may not purchase any securities by doing so. Any reply e-mail communications, including

those you generate by using the “Reply” function on your e-mail software, will be ignored or rejected.

You are responsible for protecting against viruses and other destructive items. Your use of this e-

mail is at your own risk and it is your responsibility to take precautions to ensure that it is free from viruses and

other items of a destructive nature.

OFFERING CIRCULAR

OIL AND NATURAL GAS CORPORATION LIMITED(incorporated with limited liability in the Republic of India)

ONGC VIDESH LIMITED(incorporated with limited liability in the Republic of India)

U.S.$2,000,000,000Medium Term Note Programme

Under the U.S.$2,000,000,000 Euro Medium Term Note Programme (the “Programme”), Oil and Natural Gas Corporation Limited (“ONGC”), ONGC Videsh Limited (“ONGC Videsh”) and any New Issuer (as defined in the terms and conditions of the Notes (the “Terms and Conditions of the Notes”)) (the “Issuers”, and each an “Issuer”), subject to compliance with all relevant laws, regulations and directives, may from time to time issue notes (“Notes”) denominated in any currency agreed between the relevant Issuer and the relevant Dealer (as defined below). Notes issued by ONGC Videsh and any New Issuer (each a “Guaranteed Issuer”) will be guaranteed by ONGC (in such capacity, the “Guarantor”), such guarantee (the “Guarantee”) and such Notes (the “Guaranteed Notes”), provided that, at all times, the Guarantee shall, in respect of each Series of Guaranteed Notes, be in respect of an amount not exceeding 109.00 per cent. of the total aggregate nominal amount of such Series of Guaranteed Notes outstanding from time to time (the “Applicable Limit”). The aggregate nominal amount of Notes outstanding will not at any time exceed U.S.$2,000,000,000 (or its equivalent in other currencies calculated as described herein), subject to increase as described herein.

The Programme Agreement, the Trust Deed and the Agency Agreement (each as defined herein) each contain provisions enabling ONGC, from time to time, to nominate any Subsidiary (as defined in the Terms and Conditions of the Notes) of ONGC Videsh to accede as an issuer to issue Notes under the Programme. In such event, ONGC, ONGC Videsh and such New Issuer shall make available a supplemental Offering Circular in relation to such accession. Unless and until a supplemental Offering Circular is published providing details of the accession of such New Issuer, references in this Offering Circular to “the Issuer” or “Issuers” should be taken as references to ONGC and ONGC Videsh, as applicable, only.

The Notes may be issued on a continuing basis to one or more of the Dealers specified under the section entitled “Summary of the Programme” and any further Dealer appointed under the Programme from time to time by the relevant Issuer(s) (each a Dealer and together the Dealers), which appointment may be for a specific issue or on an ongoing basis. References in this Offering Circular to the relevant Dealer shall, in the case of an issue of Notes being (or intended to be) subscribed by more than one Dealer, be to all Dealers agreeing to subscribe to such Notes.

Approval in-principle has been received from the Singapore Exchange Securities Trading Limited (the “SGX-ST”) for the establishment of the Programme and application will be made to the SGX-ST for the permission to deal in, and for the quotation of, any Notes that may be issued pursuant to the Programme and which are agreed at or prior to the time of issue thereof to be so listed on the SGX-ST. Such permission will be granted when such Notes have been admitted to the Official List of the SGX-ST. The SGX-ST assumes no responsibility for the correctness of any of the statements made or opinions expressed or reports contained herein. Admission to the Official List and quotation of any Notes on the SGX-ST are not to be taken as an indication of the merits of the Issuers, the Guarantor, their subsidiaries, their associated companies, the Programme or the Notes. Notice of the aggregate nominal amount of Notes, interest (if any) payable in respect of Notes, the issue price of Notes and any other terms and conditions not contained herein which are applicable to each Tranche (as defined in the Terms and Conditions of the Notes) of Notes will be set out in a pricing supplement (the “Pricing Supplement”) which, with respect to Notes to be listed on the SGX-ST, will be delivered to the SGX-ST on or before the date of issue of the Notes of such Tranche.

The Programme provides that Notes may be listed on such other or further stock exchange(s) as may be agreed between the relevant Issuer, (in the case of Guaranteed Notes) the Guarantor and the relevant Dealer. The Issuers may also issue unlisted Notes.

The Issuers and (in the case of Guaranteed Notes) the Guarantor may agree with any Dealer and Citicorp International Limited as trustee (the “Trustee”) that Notes may be issued in a form not contemplated by the Terms and Conditions of the Notes, in which event (in the case of Notes intended to be listed on the SGX-ST) a supplementary Offering Circular, if appropriate, will be made available which will describe the effect of the agreement reached in relation to such Notes.

Investing in Notes issued under the Programme involves certain risks and may not be suitable for all investors. Prospective investors should have sufficient knowledge and experience in financial and business matters to evaluate the information contained in this Offering Circular and in the relevant Pricing Supplement and the merits and risks of investing in a particular issue of Notes in the context of their financial position and particular circumstances. Prospective investors should have regard, inter alia, to the factors described in the section entitled “Investment Considerations”.

Notes to be listed on the SGX-ST will be accepted for clearance through Euroclear Bank SA/NV (“Euroclear”) and Clearstream Banking S.A. (“Clearstream, Luxembourg”).

The Notes may be issued in bearer form (“Bearer Notes”) or in registered form (“Registered Notes”). Each Tranche of Bearer Notes of each Series (as defined in the section entitled “Form of the Notes”) will initially be represented by either a temporary bearer global note (a “Temporary Bearer Global Note”) or a permanent bearer global note (a “Permanent Bearer Global Note” and, together with a Temporary Bearer Global Note, the “Bearer Global Notes”, and each a “Bearer Global Note”) as indicated in the applicable Pricing Supplement, which, in either case, will be delivered on or prior to the original issue date of the Tranche to a common depositary for Euroclear and Clearstream, Luxembourg. On and after the date (the “Exchange Date”) which, for each Tranche in respect of which a Temporary Bearer Global Note is issued, is 40 days after the Temporary Bearer Global Note is issued, interests in such Temporary Bearer Global Note will be exchangeable (free of charge) upon a request as described therein either for (i) interests in a Permanent Bearer Global Note of the same Series or (ii) definitive Bearer Notes of the same Series.

Registered Notes sold in an “offshore transaction” within the meaning of Regulation S (“Regulation S”) under the U.S. Securities Act of 1933 (the “Securities Act”), which will be sold outside the United States (“U.S.”), will initially be represented by a global note in registered form, without receipts or coupons, (a “Registered Global Note”) deposited with a common depositary for Euroclear and Clearstream, Luxembourg, and registered in the name of a nominee of such common depositary.

The applicable Pricing Supplement will specify that a Permanent Bearer Global Note will be exchangeable for definitive Bearer Notes in certain limited circumstances.

This Offering Circular has not been and will not be registered as a prospectus or a statement in lieu of a prospectus in respect of a public offer, information memorandum or private placement offer letter or any other offering material with the Registrar of Companies of India (the “RoC”) in accordance with the Companies Act, 2013, as amended from time to time (the “Companies Act 2013”), and other applicable Indian laws for the time being in force. This Offering Circular has not been and will not be reviewed or approved by any regulatory or statutory authority in India, including, but not limited to, the Securities and Exchange Board of India, the Reserve Bank of India, any Registrar of Companies or any stock exchange in India. This Offering Circular and the Notes are not and should not be construed as an advertisement, invitation, offer or sale of any securities whether to the public or by way of private placement to any person resident in India. The Notes have not been and will not be, offered or sold to any person resident in India. If you purchase any of the Notes, you will be deemed to have acknowledged, represented and agreed that you are eligible to purchase the Notes under applicable laws and regulations and that you are not prohibited under any applicable law or regulation from acquiring, owning or selling the Notes.

The Notes and the Guarantee have not been and will not be registered under the Securities Act or with any securities regulatory authority of any state or other jurisdiction of the United States, and the Notes may include Bearer Notes that are subject to U.S. tax law requirements and restrictions. Subject to certain exceptions, the Notes may not be offered, sold or in the case of Bearer Notes, delivered within the United States. The Notes are subject to certain restrictions on transfer, for further information see the section entitled “Subscription and Sale”. The Notes are being offered outside the United States in reliance on Regulation S under the Securities Act.

Notes issued under the Programme may be rated or unrated. Where a Tranche of Notes is to be rated, its rating will not necessarily be the same as the rating (if any) applicable to the Programme and (where applicable) such rating will be specified in the applicable Pricing Supplement. A rating is not a recommendation to buy, sell or hold securities and may be subject to suspension, change or withdrawal at any time by the assigning rating agency.

Arrangers and Dealers

Citigroup Standard Chartered Bank

The date of this Offering Circular is 27 August 2019.

A39729228 i

NOTICE TO INVESTORS

Each Issuer and the Company accepts responsibility for the information contained in this Offering

Circular. To the best of the knowledge and belief of each Issuer and the Company (each having taken all

reasonable care to ensure that such is the case) the information contained in this Offering Circular is in

accordance with the facts and does not omit anything that would make the statements therein, in light of the

circumstances under which they were made, misleading. Each Issuer and the Company, having made all

reasonable enquiries, confirms that this Offering Circular contains or incorporates all information which is

material in the context of the Programme and the Notes, that the information contained or incorporated in this

Offering Circular is true and accurate in all material respects and is not misleading, that the opinions and

intentions expressed in this Offering Circular are honestly held and that there are no other facts the omission of

which would make this Offering Circular or any of such information or the expression of any such opinions or

intentions misleading. Each Issuer and the Company accepts responsibility accordingly.

This Offering Circular is to be read in conjunction with all documents which are deemed to be

incorporated herein by reference (for further information, see the section entitled “Documents Incorporated by

Reference”). This Offering Circular shall be read and construed on the basis that such documents are

incorporated and form part of this Offering Circular.

No person is or has been authorised by any of the Issuers or the Company to give any information or to

make any representation other than those contained in this Offering Circular or any other information supplied

in connection with the Programme or the Notes and, if given or made by any other person, such information or

representations must not be relied upon as having been authorised by any Issuer, the Company, any of the

Arrangers or the Dealers, the Trustee or the Agents (as defined in the Terms and Conditions of the Notes) or

any person who controls any of them, or any of their respective officers, employees, advisers or agents, or any

affiliate of any such person. Save as expressly stated in this Offering Circular, nothing contained herein is, or

may be relied upon as, a promise or representation as to the future performance or policies of the Issuers or the

Company.

The Arrangers, the Dealers, the Trustee and the Agents have not separately verified the information

contained in this Offering Circular. None of the Arrangers, the Dealers, the Trustee, the Agents or any person

who controls any of them, or any of their respective officers, employees, advisers or agents, or any affiliate of

any such person, is making any representation or warranty expressed or implied as to the merits of the Notes or

the subscription for, purchase or acquisition thereof, the creditworthiness or financial condition or otherwise of

the Issuer. Further, none of the Arrangers, the Dealers, the Trustee or the Agents or any person who controls any

of them, or any of their respective officers, employees, advisers or agents, or any affiliate of any such person,

makes any representation or warranty as to the Issuers or the Company or as to the accuracy, reliability or

completeness of the information set out herein and the documents which are incorporated by reference in, and

form part of, this Offering Circular.

To the fullest extent permitted by law, none of the Arrangers, the Dealers, the Trustee, the Agents or any

person who controls any of them, or any of their respective officers, employees, advisers or agents, or any

affiliate of any such person, accepts any responsibility for the contents of this Offering Circular or for any other

statement made or purported to be made by the Arrangers, the Dealers, the Trustee or the Agents or on their

behalf in connection with the Issuers, the Company, the Programme or the issue and offering of the Notes. Each

of the Arrangers, each Dealer, the Trustee and each Agent and each person who controls any of them, and each

of their respective officers, employees, advisers and agents, and each affiliate of any such person, accordingly

disclaims all and any liability whether arising in tort or contract or otherwise (save as referred to above) which

it might otherwise have in respect of this Offering Circular or any such statement.

A39729228 ii

Neither the delivery of this Offering Circular (or any part thereof) nor any sale, offering or purchase

made in connection herewith shall, under any circumstances, create any implication that there has been no

change in the prospects, results of operation or general affairs of the Issuers or the Company since the date

hereof or the date upon which this Offering Circular has been most recently amended or supplemented or that

there has been no adverse change in the financial position of the Issuers or the Company since the date hereof

or the date upon which this Offering Circular has been most recently amended or supplemented or that any

other information supplied in connection with the Programme is correct as of any time subsequent to the date

on which it is supplied or, if different, the date indicated in the document containing the same. Investors should

review, inter alia, the most recently published documents incorporated by reference into this Offering Circular

when deciding whether or not to purchase any Notes.

This Offering Circular does not constitute an offer to sell or the solicitation of an offer to buy any Notes

in any jurisdiction to any person to whom it is unlawful to make the offer or solicitation in such jurisdiction.

The distribution of this Offering Circular and the offer or sale of Notes may be restricted by law in certain

jurisdictions. The Issuers, the Company, the Arrangers, the Dealers, the Trustee, the Agents and any person who

controls any of them, and each of their respective officers, employees, advisers and agents, and each affiliate of

any such person, do not represent that this Offering Circular may be lawfully distributed, or that any Notes may

be lawfully offered, in compliance with any applicable registration or other requirements in any such

jurisdiction, or pursuant to an exemption available thereunder, or assume any responsibility for facilitating any

such distribution or offering. In particular, no action has been taken by any of the Issuers, the Company, any of

the Arrangers or the Dealers, the Trustee or the Agents or any person who controls any of them, or any of their

respective officers, employees, advisers or agents, or any affiliate of any such person, which would permit a

public offering of any Notes or distribution of this Offering Circular in any jurisdiction where action for that

purpose is required. Accordingly, no Notes may be offered or sold, directly or indirectly, and neither this

Offering Circular nor any advertisement or other offering material may be distributed or published in any

jurisdiction, except under circumstances that will result in compliance with any applicable laws and regulations.

Persons into whose possession this Offering Circular or any Notes may come must inform themselves about,

and observe, any such restrictions on the distribution of this Offering Circular and the offering and sale of Notes.

In particular, there are restrictions on the distribution of this Offering Circular and the offer or sale of Notes in

the United States, the European Economic Area, the United Kingdom, the Republic of Italy, India, Japan,

Singapore and Hong Kong, for further information, see the section entitled “Subscription and Sale”.

In accordance with applicable provisions of Indian regulations, only investors that meet the ECB

Investor Requirements (as defined in this Offering Circular) are eligible to purchase or subscribe to the Indian

Issuer Notes issued by a Domestic Issuer. By purchasing the Indian Issuer Notes, each investor shall be deemed

to have acknowledged, represented and agreed that such investor is eligible to purchase such Indian Issuer Notes

issued by a Domestic Issuer under applicable laws and regulations and meets the ECB Investor Requirements

and is not otherwise prohibited under any applicable law or regulation from acquiring, owning or selling the

Indian Issuer Notes and that so long as it holds any of the Indian Issuer Notes, it will continue to meet the ECB

Investor Requirements and shall comply with applicable provisions of Indian regulations. For further

information, see the sections entitled “Summary of Relevant Indian Laws and Regulations – Foreign Exchange

Laws” and “Subscription and Sale”.

Neither this Offering Circular nor any other document or information (or any part thereof) delivered and

supplied under or in relation to the Programme or any Notes is intended to provide the basis of any credit or

other evaluation of the Issuer and should not be considered as a recommendation by any of the Issuers, the

Company, the Arrangers, the Dealers, the Trustee, the Agents or any person who controls any of them, or any

of their respective officers, employees, advisers or agents, or any affiliate of any such person, that any recipient

of this Offering Circular or any other financial statements should purchase the Notes. Each potential purchaser

of Notes shall make its own assessment of the foregoing and other relevant matters including the financial

A39729228 iii

condition and affairs and its appraisal of the creditworthiness of the Issuers and the Company and obtain its

own independent legal or other advice thereon, and its investment shall be deemed to be based on its own

independent investigation of the financial condition and affairs and its appraisal of the creditworthiness of the

Issuers and the Company. Accordingly, notwithstanding anything herein, none of the Arrangers, the Dealers,

the Trustee, the Agents or any person who controls any of them, or any of their respective officers, employees,

advisers or agents, or any affiliate of any such person, shall be held responsible for any loss or damage suffered

or incurred by the recipients of this Offering Circular or such other document or information (or such part

thereof) as a result of or arising from anything expressly or implicitly contained in or referred to in this Offering

Circular or such other document or information (or such part thereof and the same shall not constitute a ground

for rescission of any purchase or acquisition of any of the Notes by a recipient of this Offering Circular or such

other document or information (or such part thereof). None of the Arrangers, the Dealers, the Trustee or the

Agents or any person who controls any of them, or any of their respective officers, employees, advisers or

agents, or any affiliate of any such person, undertakes to review the financial condition or affairs of the Issuer

during the life of the arrangements contemplated by this Offering Circular nor to advise any investor or potential

investor in the Notes of any information coming to the attention of any of the Dealers, the Arrangers, the Trustee,

the Agents or any person who controls any of them, or any of their respective officers, employees, advisers or

agents, or any affiliate of any such person.

Any purchase or acquisition of the Notes is in all respects conditional on the satisfaction of certain

conditions set out in the Programme Agreement (as defined herein) and the issue of the Notes by the relevant

Issuer pursuant to the Programme Agreement. Any offer, invitation to offer or agreement made in connection

with the purchase or acquisition of the Notes or pursuant to this Offering Circular shall (without any liability or

responsibility) on the part of the relevant Issuer or any of the Arrangers or Dealers lapse and cease to have any

effect if (for any other reason whatsoever) the Notes are not issued by the relevant Issuer pursuant to the

Programme Agreement.

This Offering Circular does not describe all of the risks and investment considerations (including those

relating to each investor’s particular circumstances) of an investment in Notes of a particular issue. Each

potential purchaser of Notes should refer to and consider carefully the relevant Pricing Supplement for each

particular issue of Notes, which may describe additional risks and investment considerations associated with

such Notes. The risks and investment considerations identified in this Offering Circular and the relevant Pricing

Supplement are provided as general information only.

In making an investment decision, investors must rely on their own examination of the Issuers, the

Company and the terms of the Notes being offered, including the merits and risks involved. Investors should

consult their own financial, tax, accounting and legal advisers as to the risks and investment considerations

arising from an investment in an issue of Notes and should possess the appropriate resources to analyse such

investment and the suitability of such investment in their particular circumstances.

None of the Issuers, the Company, the Arrangers, the Dealers, the Trustee, the Agents or any person who

controls any of them, or any of their respective officers, employees, advisers or agents, or any affiliate of any

such person, makes any representation to any investor in the Notes regarding the legality of its investment under

any applicable laws. Any investor in the Notes should be able to bear the economic risk of an investment in the

Notes for an indefinite period of time.

EEA RETAIL INVESTORS

If the Pricing Supplement in respect of any Notes includes a legend entitled “Prohibition of Sales to EEA

Retail Investors”, the Notes are not intended to be offered, sold or otherwise made available to and should not

be offered, sold or otherwise made available to any retail investor in the European Economic Area (the “EEA”).

For these purposes, a retail investor means a person who is one (or more) of: (i) a retail client as defined in point

A39729228 iv

(11) of Article 4(1) of Directive 2014/65/EU (as amended, “MiFID II”); (ii) a customer within the meaning of

Directive (EU) 2016/97 (the “Insurance Distribution Directive”), where that customer would not qualify as a

professional client as defined in point (10) of Article 4(1) of MiFID II; or (iii) not a qualified investor as defined

in Regulation (EU) 2017/1129 (the “Prospectus Regulation”). Consequently, no key information document

required by Regulation (EU) No 1286/2014 (as amended, the “PRIIPs Regulation”) for offering or selling the

Notes or otherwise making them available to retail investors in the EEA has been prepared and therefore offering

or selling the Notes or otherwise making them available to any retail investor in the EEA may be unlawful under

the PRIIPs Regulation.

MIFID PRODUCT GOVERNANCE/TARGET MARKET

The Pricing Supplement in respect of any Notes may include a legend entitled “MiFID II Product

Governance” which will outline the target market assessment in respect of the Notes and which channels for

distribution of the Notes are appropriate. Any person subsequently offering, selling or recommending the Notes

(a “distributor”) should take into consideration the target market assessment; however, a distributor subject to

MiFID II is responsible for undertaking its own target market assessment in respect of the Notes (by either

adopting or refining the target market assessment) and determining appropriate distribution channels.

A determination will be made in relation to each issue about whether, for the purpose of the MiFID

Product Governance rules under EU Delegated Directive 2017/593 (the “MiFID Product Governance

Rules”), any Dealer subscribing for any Notes is a manufacturer in respect of such Notes, but otherwise none

of the Arrangers or the Dealers or any of their respective affiliates will be a manufacturer for the purpose of the

MiFID Product Governance Rules.

PRODUCT CLASSIFICATION PURSUANT TO SECTION 309B OF THE SECURITIES

AND FUTURES ACT (CHAPTER 289 OF SINGAPORE)

In connection with Section 309B of the Securities and Futures Act (Chapter 289) of Singapore, as

modified or amended from time to time (the “SFA”) and the Securities and Futures (Capital Markets Products)

Regulations 2018 of Singapore (the “CMP Regulations 2018”), unless otherwise specified before an offer of

Notes, the Issuers have determined, and hereby notifies all relevant persons (as defined in Section 309A(1) of

the SFA), that the Notes are ‘prescribed capital markets products’ (as defined in the CMP Regulations 2018)

and Excluded Investment Products (as defined in MAS Notice SFA 04-N12: Notice on the Sale of Investment

Products and MAS Notice FAA-N16: Notice on Recommendations on Investment Products).

STABILISATION

In connection with the issue of any Tranche of Notes, the Dealer or Dealers (if any) named as the

Stabilising Manager(s) (or persons acting on behalf of any Stabilising Manager(s)) in the applicable Pricing

Supplement may over-allot Notes or effect transactions with a view to supporting the market price of the Notes

of the Series (as defined below) of which such Tranche forms part at a level higher than that which might

otherwise prevail. However, stabilisation may not necessarily occur. Any stabilisation action or over-allotment

may begin on or after the date on which adequate public disclosure of the terms of the offer of the relevant

Tranche of Notes is made and, if begun, may cease at any time, but it must end no later than the earlier of 30

days after the issue date of the relevant Tranche of Notes and 60 days after the date of the allotment of the

relevant Tranche of Notes. Any stabilisation action or overallotment must be conducted by the relevant

Stabilising Manager(s) (or persons acting on behalf of any Stabilising Manager(s)) in accordance with all

applicable laws and rules.

A39729228 v

PRESENTATION OF OIL AND GAS RESERVES DATA

The Company has provided certain estimates regarding crude oil and natural gas reserves in this Offering

Circular. These estimates are based solely on volumetric analysis of the Company’s various license areas. In

calculating the Company’s domestic reserves, the Company uses internally-developed definitions that are based

on Petroleum Resources Management System 2018 (“PRMS 2018”). For further information, see the section

entitled “Business – Reserves Classification Standards”. The Company’s internally-developed definitions do

not strictly comply with currently accepted international standards and therefore the Company’s reserves

estimates may not be comparable with other publicly listed companies. For further information, see the sections

entitled “Business — Exploration and Production Business — Presentation of Reserves Estimates” and

“Business — Reserves Classification Standards” for more information. Moreover, the Company’s international

reserves have been calculated based on standards that vary according to the jurisdiction in which the operator

and reserves are located. The Company’s domestic and international management estimates of the reserves are

approved by the Reserve Estimate Committee (the “REC”). The Company’s domestic reserves (other than

domestic reserves held through joint ventures) have historically been audited independently every five years

but there is no assurance that the Company will conduct such audits every five years in the future. Investors

should not place undue reliance on the Company’s management estimates of its reserves. For further

information, see the section entitled “Investment Considerations—Risks Relating to the Company’s Business—

The Company’s crude oil and natural gas reserves estimates involve a degree of uncertainty and may not prove

to be correct over time. Moreover, these estimates may be unaudited or may not be fully audited and may not

accurately reflect actual reserves, or even if accurate, technical limitations may prevent the Company from

producing crude oil or natural gas from these reserves”.

In this Offering Circular, the Company reports 1P, 2P and 3P reserves. “Proved Reserves”, or “1P”,

refers to those quantities of petroleum that, by analysis of geoscience and engineering data, can be estimated

with reasonable certainty to be commercially recoverable from a given date forward from known reservoirs and

under defined economic conditions, operating methods and government regulations. “Proved and Probable

Reserves”, or “2P”, refers to 1P plus those additional Reserves that analysis of geoscience and engineering data

indicates are less likely to be recovered than Proved Reserves but more certain to be recovered than Possible

Reserves. It is equally likely that actual remaining quantities recovered will be greater than or less than the sum

of the estimated Proved and Probable Reserves. In this context, when probabilistic methods are used, there

should be at least a 50 per cent. probability that the actual quantities recovered will equal or exceed the 2P

estimate. “Proved, Probable and Possible Reserves”, or “3P”, refers to 2P plus those additional reserves that

analysis of geoscience and engineering data indicates are less likely to be recoverable than Probable Reserves.

The total quantities ultimately recovered from the project have a low probability to exceed the sum of Proved,

Probable and Possible Reserves, which is equivalent to the high-estimate scenario. When probabilistic methods

are used, there should be at least a 10 per cent. probability (P10) that the actual quantities recovered will equal

or exceed the 3P estimate.

Unless stated otherwise, all of the Company’s 1P, 2P and 3P reserves consist of the Company’s

participating interest in total global reserves, which in turn consists of the Company’s 100.00 per cent. equity

interest in the Company’s independent oil and gas properties and the Company’s participating interest in joint

venture and production-sharing contracts, without reflecting (i) the Company’s share of cash royalties payable

to the Indian central government, Indian state governments and governmental bodies outside of India, (ii) other

contractual payments such as profit petroleum, production-linked payments and bonuses, and (iii)

reimbursement for exploration expenses attributable to the Company’s participating interest. Royalties and

taxes payable to Indian government entities are payable in cash and are not payable in kind. The Company’s

1P, 2P and 3P reserves also do not include an adjustment for taxes or other amounts payable by it.

A39729228 vi

Although the Company generally reports its reserves of crude oil and natural gas in metric tons and cubic

metres, respectively, for purposes of presentation in this Offering Circular, the Company has converted

quantities of domestic crude oil from metric tons to barrels at a rate of one metric ton to 7.5 barrels. The

conversion ratio of one metric ton to 7.5 barrels is based on the weighted average specific gravity of all crude

oil produced from the Company’s domestic fields, including fields operated through joint ventures. The

Company has used crude oil conversion ratios for its international fields based on the respective specific

gravities of crude oil/Condensate produced from those fields areas as follows:

Greater Nile Petroleum Operating Company (“GNPOC”) (Sudan): one metric ton to 7.14 barrels;

Greater Pioneering Operating Company (“GPOC”) (South Sudan): one metric ton to 7.3 barrels;

Block 5A (South Sudan): one metric ton to 6.81 barrels;

Vietnam Condensate: one metric ton to 8.38 barrels;

Sakhalin (Russia): one metric ton to 7.46 barrels;

ACG (Azerbaijan): one metric ton to 7.39 barrels;

Imperial (Russia): one metric ton to 7.58 barrels;

Al Furat (Syria): one metric ton to 7.3 barrels;

Block-24 (Syria): one metric ton to 7.41 barrels;

Mansarovar Energy Colombia Ltd. (“MECL”) (Colombia): one metric ton to 6.62 barrels;

Carabobo-1 (Venezuela): one metric ton to 6.29 barrels;

PIVSA (Venezuela): one metric ton to 6.572 barrels;

BC-10 (Brazil): one metric ton to 6.66 barrels; and

CPO-5 (Colombia): one metric ton to 6.65 barrels.

Where natural gas volumes have been converted into oil equivalent numbers, this has been done using a

factor of 1,000 standard cubic metres of natural gas equalling one metric ton of oil equivalent.

The Company’s reporting policy is not, and is not required to be, derived from, or consistent with oil

and gas reserves reporting requirements for filings with the U.S. Securities and Exchange Commission (“SEC”)

and differs from such requirements in certain material respects. The Company’s reserves would differ from

those described herein if determined in accordance with oil and gas reserves reporting requirements for filings

with the SEC. There are currently no clear regulations governing public disclosure of potential reserves by oil

and gas companies operating in India or their use in securities offering documents.

Information in this Offering Circular is derived or reproduced from the Company’s internal management

estimates. Prospective investors should read the section entitled “Business” for more information on the

Company’s reserves and resources, the assumptions, methods and procedures used in the preparation of the

reserve estimates and the underlying assumptions thereof and the reserves and resources definitions that the

Company uses.

PRESENTATION OF FINANCIAL AND OTHER INFORMATION

Since 1 April 2016, the Company has maintained its financial books and records, and prepared its

financial statements, in Rupees, in accordance with the Companies (Indian Accounting Standards) Rules, 2015.

A39729228 vii

The Indian Accounting Standards (“IND-AS”) differ in certain important respects from International Financial

Reporting Standards (“IFRS”). For a discussion of the principal differences between IFRS and IND-AS as they

relate to the Company, see the section entitled “Summary of significant differences between IFRS and IND-AS”.

The audited consolidated financial statements of the Company for the years ended 31 March 2018 and

31 March 2019 included in this Offering Circular have been prepared in accordance with IND-AS and have

been audited by the auditors as set out in paragraph 6 of the section entitled “General Information”. The audited

consolidated financial statements of the Company for the years ended 31 March 2018 and 31 March 2019 are

set out on pages F-18 to F-229 and pages F-230 to F-421, respectively, in this Offering Circular. The audited

consolidated financial statements of the Company for the years ended 31 March 2018 and 31 March 2019

should be read in conjunction and in entirety with the related notes thereto.

The unaudited and reviewed consolidated financial statements of the Company for the three months

ended 30 June 2019 and the unaudited and reviewed non-consolidated financial statements of the Company for

the three months ended 30 June 2019 included in this Offering Circular have each been prepared in accordance

with IND-AS and have been reviewed by the auditors as set out in paragraph 6 of the section entitled “General

Information”. The unaudited and reviewed consolidated financial statements of the Company for the three

months ended 30 June 2019 and the unaudited and reviewed non-consolidated financial statements of the

Company for the three months ended 30 June 2019 should not be relied upon by investors to provide the same

quality of information associated with information that has been subject to an audit. None of the Arrangers, the

Dealers or any of their respective affiliates, directors or advisers makes any representation or warranty, express

or implied, regarding the sufficiency of such unaudited and reviewed consolidated financial statements of the

Company for the three months ended 30 June 2019 and unaudited and reviewed non-consolidated financial

statements of the Company for the three months ended 30 June 2019, for an assessment of, and potential

investors must exercise caution when using such data to evaluate, the Company’s financial condition, results of

operations and results. The unaudited and reviewed consolidated financial statements of the Company for the

three months ended 30 June 2019 and the unaudited and reviewed non-consolidated financial statements of the

Company for the three months ended 30 June 2019 should not be taken as an indication of the expected financial

condition, results of operations and results of the Company (whether on a consolidated or non-consolidated

basis) for the full financial year ending 31 March 2020. The unaudited and reviewed consolidated financial

statements of the Company for the three months ended 30 June 2019 and the unaudited and reviewed non-

consolidated financial statements of the Company for the three months ended 30 June 2019 are set out on pages

F-2 to F-9 and pages F-10 to F-17, respectively, in this Offering Circular. Each of the unaudited and reviewed

consolidated financial statements of the Company for the three months ended 30 June 2019 and the unaudited

and reviewed non-consolidated financial statements of the Company for the three months ended 30 June 2019

should be read in conjunction and in entirety with their respective related notes thereto.

The Company publishes its financial statements in Indian Rupees. Unless otherwise stated, all

translations from Indian Rupees to United States dollars have been made on the basis of the RBI Reference

Rate as of 31 March 2019 of Rs. 69.1713 = U.S.$1.00. All amounts translated into United States dollars in this

Offering Circular are provided solely for the convenience of the reader, and no representation is made that the

Indian Rupees or United States dollar amounts referred to in this Offering Circular could have been or could be

converted into any other currency, at any particular rate, at the above rates or at all.

CERTAIN DEFINITIONS

In this Offering Circular, references to “India” are to the Republic of India, references to “Indian

Government” or the “Government” are to the Government of India and references to the “RBI” are to the

Reserve Bank of India. References to specific data applicable to particular subsidiaries or other consolidated

entities are made by reference to the name of that particular entity.

A39729228 viii

In this Offering Circular, references to “Fiscal Year” are to the year starting from 1 April and ending on

31 March. For example, “2017 Fiscal Year” is to the 12-month period ended on 31 March 2017, “2018 Fiscal

Year” is to the twelve-month period ended on 31 March 2018 and “2019 Fiscal Year” is to the 12-month period

ended on 31 March 2019.

Unless the context otherwise indicates, all references to the “Company” are to ONGC and its

consolidated subsidiaries, as the context requires, and to “ONGC Videsh” are to ONGC Videsh Limited.

In this Offering Circular, references to “FATF Compliant Country” are to a country that is a member

of the Financial Action Task Force (“FATF”) or a member of a FATF-style regional body and should not be a

country identified in the public statement of the FATF as (a) a jurisdiction having a strategic Anti-Money

Laundering or Combating the Financing of Terrorism deficiencies to which counter measures apply; or (b) a

jurisdiction that has not made sufficient progress in addressing the deficiencies or has not committed to an

action plan developed with the FATF Financial Action Task Force to address the deficiencies, and references to

“IOSCO Compliant Country” are to a country that whose securities market regulator is a signatory to the

International Organisation of Securities Commission's (“IOSCO”) Multilateral Memorandum of

Understanding (Appendix A Signatories) or a signatory to a bilateral Memorandum of Understanding with the

Securities and Exchange Board of India (“SEBI”) for information sharing arrangements.

In this Offering Circular, references to “ECB Guidelines” refers to the Foreign Exchange Management

(Borrowing or Lending) Regulations 2018 and circulars or notifications issued thereunder by the RBI, from

time to time including the Master Direction External Commercial Borrowings, Trade Credits and Structured

Obligations dated 26 March 2019, as amended from time to time and the Master Direction on Reporting under

Foreign Exchange Management Act, 1999, dated 1 January 2016, each as amended from time to time.

All references in this document to “U.S. dollars” and “U.S.$” refer to United States dollars, all

references to “Rupee”, “Rupees”, “INR”, “Rs.” and “₹” refer to Indian Rupees and all references to “S$” and

“SGD” refer to Singapore dollars. In addition, all references to “Sterling”, “GBP” and “£” refer to pounds

sterling and all references to “euro”, “EUR” and “€” refer to the currency introduced at the start of the third

stage of European economic and monetary union pursuant to the Treaty on the Functioning of the European

Community, as amended.

References to “crores” and “lakhs” in the Company’s consolidated financial statements are to the

following:

One lakh ...................................................... 100,000 (one hundred thousand)

One crore .................................................... 10,000,000 (ten million)

Ten crores .................................................... 100,000,000 (one hundred million)

One hundred crores ..................................... 1,000,000,000 (one thousand million or one billion)

In this Offering Circular, where information has been presented in millions or billions of units, amounts may

have been rounded, in the case of information presented in millions, to the nearest ten thousand or one hundred

thousand units or, in the case of information presented in billions, one, ten or one hundred million units.

Accordingly, the totals of columns or rows of numbers in tables may not be equal to the apparent total of the

individual items and actual numbers may differ from those contained herein due to rounding.

INDUSTRY AND OTHER MARKET DATA

While the Company has compiled, extracted, reproduced market or other industry data from external

sources, including third parties, analysts or industry or general publications, the Issuers, the Company, the

Arrangers and the Dealers have not independently verified that data or ascertained the underlying economic

A39729228 ix

assumptions relied upon therein. Reasonable actions have been taken by the Company to ensure that the

information in this Offering Circular that is based on third party sources have been accurately reproduced and,

as far as the Issuers, the Company, the Arrangers and the Dealers are aware and are able to ascertain from

information published by third parties, no facts have been omitted that would render the reproduced information

inaccurate or misleading. Subject to the foregoing, none of the Issuers, the Company, the Arrangers, the Dealers,

the Trustee or the Agents can assure investors of the accuracy and completeness of, or take any responsibility

for, such data. The source of such third-party information is cited whenever such information is used in this

Offering Circular.

FORWARD-LOOKING STATEMENTS

This Offering Circular contains certain “forward-looking statements”. These forward-looking statements

generally can be identified by words or phrases such as “aim”, “anticipate”, “believe”, “estimate”, “expect”,

“intend”, “objective”, “plan”, “project”, “will”, “will continue”, “will pursue” or other words or phrases of

similar import. Similarly, statements that describe the Company’s objectives, strategies, plans or goals are also

forward-looking statements. All forward-looking statements are subject to risks, uncertainties and assumptions

about us that could cause actual results to differ materially from those contemplated by the relevant forward-

looking statement.

Important factors that could cause actual results to differ materially from the Company’s expectations

include, but are not limited to, the following:

the project completion dates, estimated project costs and total value of contracts awarded;

variation in reserves data and estimates relating to contingent and prospective resources, and the Company’s

actual production, revenues and expenditure;

production volumes;

the outcome of exploration and development activity;

the Company’s ability to find, develop or acquire additional reserves;

fluctuations or a substantial or extended decline in international prices for oil and gas;

regulatory changes pertaining to the industries in India or other countries in which the Company has its

businesses and the Company’s ability to respond to them;

claims against the Company due to an environmental disaster, exploration accidents or any other uninsured

event;

the Company’s ability to successfully implement its strategy, growth and expansion;

regulatory changes in the oil and gas sector;

general economic and business conditions in the markets in which the Company operates and in the local,

regional and national economies;

technological changes in the future;

the Company’s exposure to market risks;

general economic and political conditions in India and which have an impact on the Company’s business

activities or investments;

terrorist attacks, civil disturbances, regional conflicts, accidents and natural disasters;

A39729228 x

the monetary and fiscal policies of India, inflation, deflation, unanticipated turbulence in interest rates,

foreign exchange rates, equity prices or other rates or prices;

the performance of the financial markets in India and globally;

changes in domestic laws, regulations and taxes; and

increasing competition in or other factors affecting the industry segments in which the Company operates.

For further discussion of factors that could cause the Company’s actual results to differ, see the section

entitled “Investment Considerations”. By their nature, certain market risk disclosures are only estimates and

could be materially different from what actually occurs in the future. As a result, actual future gains or losses

could materially differ from those that have been estimated. None of the Issuers, the Company, the Arrangers,

the Dealers, the Trustee, the Agents or any person who controls any of them, or any of their respective officers,

employees, advisers or agents, or any affiliate of any such person, have any obligation to update or otherwise

revise any statements reflecting circumstances arising after the date hereof or to reflect the occurrence of

underlying events, even if the underlying assumptions do not come to fruition.

ENFORCEMENT OF FOREIGN JUDGMENTS IN INDIA

Under the Programme, the Notes may be issued by ONGC, ONGC Videsh or any New Issuer (as defined

in the Terms and Conditions of the Notes). ONGC and ONGC Videsh are limited liability public companies

incorporated under the laws of India. A New Issuer may be a company incorporated outside India (an “Offshore

Subsidiary Issuer”) or a company incorporated under the laws of India (a “Domestic Subsidiary Issuer” and

together with the ONGC (in its capacity as an issuer) and ONGC Videsh, the “Domestic Issuers”). ONGC will

be a guarantor in respect of Notes issued by ONGC Videsh or any New Issuer.

All of ONGC Videsh’s directors and executive officers are residents of India and such persons are located

in India. As a result, it may not be possible for investors to effect service of process on ONGC Videsh or such

persons in jurisdictions outside of India, or to enforce against them judgments obtained in courts outside of

India predicated upon civil liabilities of ONGC Videsh or such directors and executive officers under laws other

than Indian law. All of ONGC’s directors and executive officers are residents of India and all or a substantial

portion of the assets of ONGC and such persons are located in India. As a result, it may not be possible for

investors to effect service of process on ONGC or such persons in jurisdictions outside of India, or to enforce

against them judgments obtained in courts outside of India predicated upon civil liabilities of ONGC or such

directors and executive officers under laws other than Indian law. Each Domestic Issuer’s (other than ONGC

Videsh and ONGC) directors and executive officers may be residents of India and all or a substantial portion of

the assets of such Domestic Issuer and such persons may be located in India. As a result, it may not be possible

for investors to effect service of process on such Domestic Issuer or such persons in jurisdictions outside of

India, or to enforce against them judgments obtained in courts outside of India predicated upon civil liabilities

of such Domestic Issuer or such directors and executive officers under laws other than Indian law.

In addition, India is not a party to any international treaty in relation to the recognition or enforcement

of foreign judgments. Recognition and enforcement of foreign judgments is provided for under section 13 and

section 44A of the Indian Code of Civil Procedure, 1908, as amended (the “Civil Code”). Section 44A of the

Civil Code provides that where a foreign judgment has been rendered by a superior court in any country or

territory outside India which the Indian Government has by notification declared to be a reciprocating territory,

it may be enforced in India by proceedings in execution as if the judgment had been rendered by the relevant

court in India. However, section 44A of the Civil Code is applicable only to monetary decrees not being in the

nature of any amounts payable in respect of taxes or other charges of a like nature or in respect of a fine or other

penalty and is not applicable to arbitration awards even if such awards are enforceable as a decree or judgment.

A39729228 xi

The United Kingdom has been declared by the Indian Government to be a reciprocating territory for the

purposes of section 44A of the Civil Code and the High Courts in England as the relevant superior courts.

Accordingly, a judgment of a superior court in the United Kingdom may be enforced by proceedings in

execution and a judgment not of a superior court, by a fresh suit resulting in a judgment or order. A judgment

of a court in a jurisdiction which is not a reciprocating territory may be enforced only by a new suit upon the

judgment and not by proceedings in execution. Section 13 of the Civil Code provides that a foreign judgment

shall be conclusive as to any matter thereby directly adjudicated upon except: (i) where it has not been

pronounced by a court of competent jurisdiction; (ii) where it has not been given on the merits of the case; (iii)

where it appears on the face of the proceedings to be founded on an incorrect view of international law or a

refusal to recognise the law of India in cases where such law is applicable; (iv) where the proceedings in which

the judgment was obtained were opposed to natural justice; (v) where it has been obtained by fraud; or (vi)

where it sustains a claim founded on a breach of any law in force in India. The suit must be brought in India

within three years from the date of the judgment in the same manner as any other suit filed to enforce a civil

liability in India. It is unlikely that a court in India would award damages on the same basis as a foreign court

if an action were brought in India. Furthermore, it is unlikely that an Indian court would enforce a foreign

judgment if it viewed the amount of damages awarded as excessive or inconsistent with Indian practice. A party

seeking to enforce a foreign judgment in India is required to obtain approval from the RBI under the Foreign

Exchange Management Act, 1999, as amended (the “FEMA”) to repatriate outside India any amount recovered

pursuant to execution. Any judgment in a foreign currency would be converted into Indian Rupees on the date

of the judgment and not on the date of the payment. Also, a party may file suit in India against each of the Issuer

and the Guarantor, its directors or its executive directors as an original action.

ENFORCEMENT OF THE GUARANTEE

The primary exchange control legislation in India is FEMA. Pursuant to FEMA, the Indian Government

and the RBI have issued various regulations, rules, circulars and press notes in connection with various aspects

of exchange control. The primary regulations governing overseas direct investments outside India by Indian

residents as well as issuances of guarantees by Indian companies in favour of their overseas subsidiaries are the

Foreign Exchange Management (Guarantees) Regulations, 2000, as amended from time to time, (the “FEMA

Guarantees Regulations”), the Foreign Exchange Management (Transfer or Issue of any Foreign Security)

Regulations, 2004, as amended from time to time (the “Foreign Security Regulations”) and “Master Direction-

Direct Investment by Residents in Joint Venture (JV)/ Wholly Owned Subsidiary (WOS) Abroad” dated 1

January 2016 issued by the RBI, as amended from time to time (the “FEMA ODI Regulations”, together with

the Foreign Security Regulations and FEMA Guarantees Regulations, the “FEMA Guarantee Laws”). The

term “direct investment outside India” has been defined by the FEMA Guarantee Laws to mean investment by

way of contribution to the capital or subscription to the Memorandum of Association (i.e. charter documents)

of a foreign entity or by way of purchase of existing shares of a foreign entity either by market purchase or

private placement or through stock exchange, but does not include portfolio investment.

Indian entities may offer any form of guarantee, corporate or personal (including the personal guarantee

by indirect resident individual promoters of an Indian entity), guarantee by the promoter company, or guarantee

by a group company, sister concern or associate company in India subject to certain conditions.

Pursuant to the FEMA Guarantee Laws, an Indian company is permitted to make direct investments

outside India in its wholly-owned subsidiaries (“WOS”) and joint ventures (“JV”), under the limits of 400 per

cent. of the net worth of the Indian entity in accordance with the last audited balance sheet prescribed by RBI.

Any financial commitment exceeding U.S.$1 billion (or its equivalent) in a financial year requires prior RBI

approval even when the total financial commitment of the Indian entity is within the eligible 400 per cent. net

worth limit under the automatic route. The Indian entity can extend a guarantee to an overseas JV/WOS through

A39729228 xii

(a) an automatic route if it has direct or indirect equity participation in such JV/WOS, or (b) through RBI

approval if it does not have equity contribution in the JV/WOS, in each case provided that such JV/WOS is

located in a FATF Compliant Country. Under the FEMA Guarantee Laws, all financial commitments including

all forms of guarantees should be within the overall ceiling prescribed.

For the purposes of the FEMA Guarantee Laws, “total financial commitment” includes, inter alia, 100

per cent. of the amount of the guarantee (other than any performance guarantee) issued by the Indian entity. The

Indian company (which is making the direct investment outside India) should not be on the RBI’s exporters’

caution list or list of defaulters to the system circulated by specified entities or be under investigation by any

investigation or enforcement agency or regulatory body. However, all such guarantees must specify a maximum

amount and duration of the guarantee upfront, so no guarantee can be open-ended or unlimited. There are

reporting instructions that are applicable in Form ODI which is submitted by the authorised dealer bank of the

Indian entity in India to the RBI.

If a guarantee issued by an Indian company on behalf of its JV/WOS is enforced by a competent court

in a territory other than a “reciprocal territory”, the judgment must be enforced in India by a new suit upon the

judgment and not by proceedings in execution. Such a suit has to be filed in India within three years from the

date of the judgment in the same manner as any other suit filed to enforce a civil liability in India. A party

seeking to enforce a foreign judgment in India is required to obtain RBI approval to repatriate outside India any

amount recovered pursuant to the execution of such a judgment.

The Guarantor is not entitled to immunity on the basis of sovereignty or otherwise from any legal

proceedings in India to enforce the Guarantee or any liability or obligation of the Guarantor arising thereunder.

As the Guarantee is an obligation of a type which Indian courts would usually enforce, the Guarantee

should be enforced against the Guarantor in accordance with its terms by an Indian court, subject to the

following exceptions: (a) enforcement may be limited by general principles of equity, such as injunctions; (b)

the remedy of specific performance may not be available in certain circumstances; and (c) actions may become

barred under the Limitation Act, 1963, or may be or become subject to set-off or counterclaim, and failure to

exercise a right of action within the relevant prescribed limitation period will operate as a bar to the exercise of

such right; (d) any certificate, determination, notification, opinion or the like will not be binding on an Indian

court, which will have to be independently satisfied on the contents thereof for the purpose of enforcement

despite any provisions in the relevant documents to the contrary; and (e) all limitations resulting from the laws

of reorganisation, suretyship or similar laws of general application affecting creditors’ rights.

For details on the requisite filings and the approval granted by the RBI pursuant to which the Guarantee

is issued, see the section entitled “Government Approvals/Filings” below. At all times, the Guarantee by the

Guarantor in respect of each Series of Guaranteed Notes, shall be in respect of an amount not exceeding 109.00

per cent. of the outstanding nominal amount of such Series of Guaranteed Notes. For further information, see

the section entitled “Terms and Conditions of the Notes”.

GOVERNMENT APPROVALS/FILINGS

The relevant Issuer will make all required filings, registrations or reports with the relevant governmental

authorities of its jurisdiction of incorporation from time to time.

The Domestic Issuers will make all required filings, registrations or reports with the relevant governmental

authorities of India from time to time. In respect of any offering of Indian Issuer Notes made by ONGC (in its

capacity as issuer) or ONGC Videsh or by any Domestic Subsidiary Issuer and guaranteed by the Guarantor,

the relevant Domestic Issuer will need to file Form ECB with their authorised dealer bank (the “AD Bank”) to

obtain a loan registration number from the RBI before an issuance of Indian Issuer Notes by such a Domestic

Issuer is effected. A monthly filing in the prescribed form of Form ECB – 2 is also required to be made by the

A39729228 xiii

relevant Domestic Issuer. The maximum amount that can be raised by way of external commercial borrowing

under the automatic route by each Domestic Issuer is U.S.$750 million per financial year or its equivalent. For

any amounts over and above this, a prior RBI approval will be required to be obtained.

For any offering of Notes made by any Offshore Subsidiary Issuer which are guaranteed by the Guarantor,

the guarantee must comply with the FEMA Guarantee Laws if the guarantee is to be provided under the

automatic route and without prior RBI approval. If any of the conditions are not satisfied, then a prior RBI

approval will be required for the guarantee to be provided. The Guarantor will make or procure to make all

required filings or reports with the requisite regulatory or governmental agency or body in India from time to

time, including, but not limited to, the filing of Form ODI prescribed under the FEMA Guarantee Laws of India

in relation to the Guarantee every year on or before 31 December through an authorised dealer of the Indian

entity in India with the RBI.

NOTICE TO POTENTIAL INVESTORS IN NOTES ISSUED BY A DOMESTIC ISSUER

Holders and beneficial owners of Notes to be issued by a Domestic Issuer under this Programme shall be

responsible for compliance with restrictions on the ownership of the Notes imposed from time to time by

applicable laws or by any regulatory authority or otherwise. In this context, holders and beneficial owners of

Notes issued by an Issuer shall be deemed to have acknowledged, represented and agreed that such holders and

beneficial owners are eligible to purchase such Notes under applicable laws and regulations and are not

prohibited under any applicable law or regulation from acquiring, owning or selling such Notes issued by an

Issuer. Potential investors should seek independent advice and verify compliance prior to any purchase of the

Notes.

The holders and beneficial owners of Indian Issuer Notes shall be deemed to confirm that for so long as

they hold any Indian Issuer Notes, they will comply with the ECB Investor Requirements (for further

information, see the section entitled “Summary of Relevant Indian Laws and Regulations – Foreign Exchange

Laws”). Further, all Noteholders (including holders and beneficial owners) represent and agree that the Indian

Issuer Notes issued by a Domestic Issuer will not be transferred or sold or offered on the secondary market to

any person who does not comply with the ECB Investor Requirements or comply with the ECB Guidelines.

To comply with applicable laws and regulations, the relevant Issuer or its duly appointed agent may from

time to time request Euroclear and Clearstream, Luxembourg to provide them with details of the accountholders

within Euroclear and Clearstream, Luxembourg, as may be appropriate, that hold the Notes issued by a

Domestic Issuer and the number of Notes held by each such accountholder.

Euroclear and Clearstream, Luxembourg participants which are holders of the Notes or intermediaries

acting on behalf of such Noteholders would be deemed to have hereby authorised Euroclear and Clearstream,

Luxembourg, as may be appropriate, to disclose such information to the relevant Issuer or its duly appointed

agent.

A39729228 xiv

TABLE OF CONTENTS

Page

DOCUMENTS INCORPORATED BY REFERENCE ...................................................................................... 1

GENERAL DESCRIPTION OF THE PROGRAMME ..................................................................................... 2

SUMMARY OF THE PROGRAMME .............................................................................................................. 3

INVESTMENT CONSIDERATIONS ..............................................................................................................10

FORM OF THE NOTES ...................................................................................................................................67

FORM OF PRICING SUPPLEMENT ..............................................................................................................71

TERMS AND CONDITIONS OF THE NOTES ..............................................................................................82

USE OF PROCEEDS ...................................................................................................................................... 118

CAPITALISATION AND INDEBTEDNESS OF THE COMPANY .............................................................. 119

SELECTED FINANCIAL INFORMATION AND OTHER DATA ...............................................................121

OVERVIEW OF THE OIL INDUSTRY OF INDIA .......................................................................................127

DESCRIPTION OF ONGC VIDESH LIMITED ............................................................................................151

BUSINESS ......................................................................................................................................................157

MANAGEMENT ............................................................................................................................................229

PRINCIPAL SHAREHOLDERS’ AND DIRECTORS’ INTERESTS IN THE COMPANY..........................243

RELATIONSHIP WITH THE INDIAN GOVERNMENT AND CERTAIN RELATED PARTY

TRANSACTIONS ..................................................................................................................................244

SUMMARY OF RELEVANT INDIAN LAWS AND REGULATIONS ........................................................249

TAXATION .....................................................................................................................................................274

CLEARANCE AND SETTLEMENT ARRANGEMENTS ............................................................................278

SUBSCRIPTION AND SALE ........................................................................................................................280

SUMMARY OF SIGNIFICANT DIFFERENCES BETWEEN IFRS AND IND-AS ....................................288

GENERAL INFORMATION ..........................................................................................................................296

GLOSSARY OF CERTAIN GENERAL AND TECHNICAL TERMS ..........................................................299

INDEX TO FINANCIAL STATEMENTS ...................................................................................................... F-1

A39729228 1

DOCUMENTS INCORPORATED BY REFERENCE

The following documents published or issued from time to time after the date hereof shall be deemed to

be incorporated in, and to form part of, this Offering Circular:

(a) the most recently published audited consolidated annual financial statements, and any consolidated

and/or unconsolidated financial statements (whether audited or unaudited) published subsequent to such

annual financial statements, of the Company from time to time (if any), in each case with the report of

the Company’s auditors in connection therewith (if any); and

(b) all supplements or amendments to this Offering Circular circulated by any Issuer from time to time.

Any statement contained herein or in a document which is deemed to be incorporated by reference herein

shall be deemed to be modified or superseded for the purpose of this Offering Circular to the extent that a

statement contained in any such subsequent document which is deemed to be incorporated by reference herein

modifies or supersedes such earlier statement (whether expressly, by implication or otherwise). Any statement

so modified or superseded shall not be deemed, except as so modified or superseded, to constitute a part of this

Offering Circular.

Each Issuer will provide, without charge, to each person to whom a copy of this Offering Circular has

been delivered, upon the request of such person, a copy of any or all of the documents deemed to be incorporated

herein by reference unless such documents have been modified or superseded as specified above. Requests for

such documents should be directed to the relevant Issuer at its office set out at the end of this Offering Circular.

In addition, such documents as are deemed to be incorporated in, and to form part of, this Offering Circular (as

specified in the first paragraph of this section “Documents incorporated by reference”) will be available for

inspection by any Noteholder at the principal place of business of the Trustee (being at the date of this Offering

Circular at 20/F, Citi Tower, One Bay East, 83 Hoi Bun Road, Kwun Tong, Kowloon, Hong Kong) at all

reasonable times during normal business hours (being 9.00 a.m. to 3.00 p.m.) following prior written request

and proof of holding and identity satisfactory to the Trustee and subject to such documents having been provided

to the Trustee by the relevant Issuer.

If the terms of the Programme are modified or amended in a manner which would make this Offering

Circular, as so modified or amended, inaccurate or misleading, to an extent which is material in the context of

the Programme, a new offering circular will be prepared.

A39729228 2

GENERAL DESCRIPTION OF THE PROGRAMME

Under the Programme, the Issuers may from time to time issue Notes denominated in any currency,

subject as set out in the Programme Agreement. A summary of the terms and conditions of the Programme and

the Notes appears below. The applicable terms of any Notes will be agreed between the relevant Issuer, (in the

case of Guaranteed Notes) the Guarantor and the relevant Dealer prior to the issue of the Notes and will be set

out in the Terms and Conditions of the Notes endorsed on, attached to, or incorporated by reference into, the

Notes, as modified and supplemented by the applicable Pricing Supplement attached to, or endorsed on, such

Notes, as more fully described under the section entitled “Form of the Notes”.

This Offering Circular and any supplement will only be valid for listing Notes on the SGX-ST in an

aggregate nominal amount which, when added to the aggregate nominal amount then outstanding of all Notes

previously or simultaneously issued under the Programme, does not exceed U.S.$2,000,000,000 or its

equivalent in other currencies. For the purpose of calculating the U.S. dollar equivalent of the aggregate nominal

amount of Notes issued under the Programme from time to time:

(a) the U.S. dollar equivalent of Notes denominated in another Specified Currency (as specified in the

applicable Pricing Supplement in relation to the relevant Notes, described under the section entitled

“Form of the Notes”) shall be determined, at the discretion of the relevant Issuer, either as of the date on

which agreement is reached for the issue of Notes or on the preceding day on which commercial banks

and foreign exchange markets are open for business in London, in each case on the basis of the spot rate

for the sale of the U.S. dollar against the purchase of such Specified Currency in the London foreign

exchange market quoted by any leading international bank selected by the relevant Issuer on the relevant

day of calculation;

(b) the U.S. dollar equivalent of Dual Currency Notes, Index Linked Notes and Partly Paid Notes (each as

specified in the applicable Pricing Supplement in relation to the relevant Notes, described under the

section entitled “Form of the Notes”) shall be calculated in the manner specified above by reference to

the original nominal amount on issue of such Notes (in the case of Partly Paid Notes regardless of the

subscription price paid); and

(c) the U.S. dollar equivalent of Zero Coupon Notes (as specified in the applicable Pricing Supplement in

relation to the relevant Notes, described under the section entitled “Form of the Notes”) and other Notes

issued at a discount or a premium shall be calculated in the manner specified above by reference to the

net proceeds received by the relevant Issuer for the relevant issue.

The offering of the Notes will be made entirely outside India. This Offering Circular may not be

distributed directly or indirectly in India or to residents of India and the Notes are not being offered or sold and

may not be offered or sold directly or indirectly in India or to, or for the account or benefit of, any resident of

India.

Each purchaser of Notes will be deemed to represent that it is neither located in India nor a resident of

India and that it is not purchasing for, or for the account or benefit of, any such person, and understands that the

Notes may not be offered, sold, pledged or otherwise transferred to any person located in India, to any resident

of India or to, or for the account of, such persons, unless determined otherwise in compliance with applicable

law.

Each Issuer will issue Notes under the Programme in accordance with applicable laws.

The Indian Government does not provide any guarantee or financial support in relation to any payment

or obligation in respect of the Notes and has no commitment or obligation whatsoever in relation to any payment

or obligation in respect of the Notes.

A39729228 3

SUMMARY OF THE PROGRAMME

The following summary does not purport to be complete and is taken from, and is qualified in its entirety by, the

remainder of this Offering Circular and, in relation to the terms and conditions of any particular Tranche of

Notes, the applicable Pricing Supplement. Words and expressions defined in the sections entitled “Form of the

Notes” and “Terms and Conditions of the Notes” shall have the same meanings in this summary.

Issuers: .......................................................... ONGC, ONGC Videsh and any New Issuer.

Accession of New Issuers: ............................ The Programme Agreement, the Trust Deed and the Agency

Agreement each contain provisions enabling any Subsidiary (as

defined in the Terms and Conditions of the Notes) of ONGC Videsh

to accede as an issuer to issue Notes under the Programme. In such

event, ONGC, ONGC Videsh and such New Issuer shall make

available a supplemental Offering Circular in relation to such

accession.

Legal Entity Identifiers: ................................ Oil and Natural Gas Corporation Limited:

335800FPDZ9MRSNO7N41

ONGC Videsh Limited:

335800WPRPCRI524XG72

Guarantor (in the case of Guaranteed Notes

only): .........................................................

Notes issued by any Guaranteed Issuer will be guaranteed by

ONGC. References in this Offering Circular to the Guarantor shall

only apply to any Guaranteed Notes that are issued under the

Programme.

Investment Considerations: ........................... There are certain factors that may affect the relevant Issuer’s and

(in the case of Guaranteed Notes) the Guarantor’s ability to fulfil

its obligations under Notes issued under the Programme. These are

set out under the section entitled “Investment Considerations”

below. In addition, there are certain factors which are material for

the purpose of assessing the market risks associated with Notes

issued under the Programme. These are set out under the section

entitled “Investment Considerations” and include certain risks

relating to the structure of particular Series of Notes and certain

market risks.

Description: .................................................. Medium Term Note Programme.

Arrangers: ..................................................... Citigroup Global Markets Limited and Standard Chartered Bank

(Singapore) Limited.

Dealers: ......................................................... Citigroup Global Markets Limited and Standard Chartered Bank

(Singapore) Limited

and any other Dealers appointed in accordance with the Programme

Agreement.

Certain Restrictions: ..................................... Each issue of Notes in respect of which particular laws, guidelines,

regulations, restrictions or reporting requirements apply will only

be issued in circumstances which comply with such laws,

guidelines, regulations, restrictions or reporting requirements from

time to time (for further information, see the section entitled

“Subscription and Sale”) including the following restrictions

applicable at the date of this Offering Circular.

A39729228 4

Trustee: ......................................................... Citicorp International Limited.

Principal Paying Agent: ................................ Citibank, N.A., London Branch.

Transfer Agent: ............................................. Citibank, N.A., London Branch.

Registrar: ...................................................... Citigroup Global Markets Europe AG.

Programme Size: ........................................... U.S.$2,000,000,000 (or its equivalent in other currencies calculated

as described under the section entitled “General Description of the

Programme”) in aggregate nominal amount of Notes outstanding

at any time. The Issuers and the Guarantor may increase the amount

of the Programme in accordance with the terms of the Programme

Agreement.

Distribution: .................................................. Notes may be distributed by way of private or public placement and

in each case on a syndicated or non-syndicated basis.

Currencies: .................................................... Subject to any applicable legal or regulatory restrictions, any

currency agreed between the relevant Issuer, (in the case of

Guaranteed Notes) the Guarantor and the relevant Dealer.

Maturities: ..................................................... Such maturities as may be agreed between the relevant Issuer and

the relevant Dealer, subject to such minimum or maximum

maturities as may be allowed or required from time to time by the

relevant central bank (or equivalent body) or any laws or

regulations applicable to the relevant Issuer, (in the case of

Guaranteed Notes) the Guarantor including but not limited to the

minimum maturity period specified under the ECB Guidelines or

the relevant Specified Currency.

Issue Price: .................................................... Notes may be issued on a fully-paid or a partly-paid basis and at an

issue price which is at par or at a discount to, or premium over, par.

Form of Notes: .............................................. The Notes will be issued in bearer and/or registered form as

described in the section entitled “Form of the Notes”.

Fixed Rate Notes: ......................................... Fixed interest will be payable at such rate or rates in arrear and on

such date or dates as may be agreed between the relevant Issuer and

the relevant Dealer, subject to any regulatory requirement

(including but not limited to the ECB Guidelines) and on

redemption and will be calculated on the basis of such Day Count

Fraction as may be agreed between the relevant Issuer and the

relevant Dealer, subject to any regulatory requirement (including

but not limited to the ECB Guidelines).

Each Fixed Rate Note shall have an interest rate which shall be in

accordance with applicable Indian regulatory requirements

(including but not limited to the ECB Guidelines or the FEMA

Guarantee Laws, as applicable) or any specific approval received

by the relevant Issuer (where relevant) from the RBI or the AD

Bank, as the case may be, or any other governmental or regulatory

authority.

Floating Rate Notes: ..................................... Floating Rate Notes will bear interest at a rate, subject to any

regulatory requirement including but not limited to the ECB

Guidelines, determined:

(i) on the same basis as the floating rate under a notional interest

rate swap transaction in the relevant Specified Currency

A39729228 5

governed by an agreement incorporating the 2006 ISDA

Definitions (as published by the International Swaps and

Derivatives Association, Inc., and as amended and updated as

at the Issue Date of the first Tranche of the Notes of the

relevant Series); or

(ii) on the basis of a reference rate appearing on the agreed screen

page of a commercial quotation service; or

(iii) on such other basis as may be agreed between the relevant

Issuer and the relevant Dealer.

The margin (if any) relating to such floating rate will be agreed

between the relevant Issuer and the relevant Dealer for each Series

of Floating Rate Notes, subject to any regulatory requirement

(including but not limited to the ECB Guidelines).

The rate of interest shall be in accordance with applicable Indian

regulatory requirements (including without limitation, the ECB

Guidelines or the FEMA Guarantee Laws, as applicable) or any

specific approval received by the relevant Issuer (where relevant)

from the RBI or the AD Bank, as the case may be, or any other

governmental or regulatory authority.

Floating Rate Notes may also have a maximum interest rate, a

minimum interest rate or both.

Index Linked Notes: ..................................... Payments of principal in respect of Index Linked Redemption

Notes or of interest in respect of Index Linked Interest Notes will

be calculated by reference to such index and/or formula or to

changes in the prices of securities or commodities or to such other

factors as the relevant Issuer and the relevant Dealer may agree,

subject to any regulatory requirement (including but not limited to

the ECB Guidelines).

The rate of interest shall be in accordance with applicable Indian

regulatory requirements (including without limitation, the ECB

Guidelines or the FEMA Guarantee Laws, as applicable) or any

specific approval received by the relevant Issuer (where relevant)

from the RBI or the AD Bank, as the case may be, or any other


Other provisions in Floating Rate Notes and

Index Linked Interest Notes:......................

Floating Rate Notes and Index Linked Interest Notes may also have

a relation to a maximum interest rate, a minimum interest rate or

both, subject to any regulatory requirement (including but not

limited to the ECB Guidelines).

Interest on Floating Rate Notes and Index Linked Interest Notes in

respect of each Interest Period, as agreed prior to issue by the

relevant Issuer and the relevant Dealer, will be payable on such

Interest Payment Dates, and will be calculated on the basis of such

Day Count Fraction, as may be agreed between the relevant Issuer

and the relevant Dealer.

Dual Currency Notes: ................................... Payments (whether in respect of principal or interest and whether

at maturity or otherwise) in respect of Dual Currency Notes will be

made in such currencies, and based on such rates of exchange, as

the relevant Issuer and the relevant Dealer may agree, subject to

A39729228 6

any regulatory requirement (including but not limited to the ECB

Guidelines).

Each Dual Currency Interest Note shall have an interest rate which

shall be in accordance with Indian regulatory requirements

(including but not limited to the ECB Guidelines or the FEMA

Guarantee Laws, as applicable) or any specific approval received

by the relevant Issuer (where relevant) from the RBI or the AD

Bank, as the case may be, or any other governmental or regulatory

authority.

Partly Paid Notes: ......................................... Each Issuer may issue Notes in respect of which the issue price is

paid in separate instalments in such amounts and on such dates as

the relevant Issuer and the relevant Dealer may agree.

Each Partly Paid Note shall have an interest rate which shall be in

accordance with Indian regulatory requirements (including but not

limited to the ECB Guidelines or the FEMA Guarantee Laws, as

applicable) or any specific approval received by the relevant Issuer

(where relevant) from the RBI or the AD Bank, as the case may be,

or any other governmental or regulatory authority.

Zero Coupon Notes: ...................................... Zero Coupon Notes will be offered and sold at a discount to their

nominal amount and will not bear interest.

Other Notes: .................................................. The relevant Issuer and (in the case of Guaranteed Notes) the

Guarantor may agree with any Dealer, the Trustee and the Principal

Paying Agent that Notes may be issued in a form not contemplated

by the Terms and Conditions of the Notes, in which event the

relevant provisions will be included in the applicable Pricing

Supplement.

Redemption: .................................................. Unless otherwise indicated in the applicable Pricing Supplement

the relevant Notes cannot be redeemed prior to their stated maturity

other than (i) in specified instalments, if applicable, (ii) for taxation

reasons, (iii) following a Change in Control (as defined in

Condition 7.3 of the Terms and Conditions of the Notes) or (iv)

following an Event of Default (as defined in Condition 10.1 of the

Terms and Conditions of the Notes).

ECB Guidelines would require any Domestic Issuer to obtain the

prior approval of the RBI or the AD Bank as the case may be, before

providing notice for or effecting such a redemption prior to the

stated maturity date and such approval may not be forthcoming.

The applicable Pricing Supplement may provide that Notes may be

redeemable in separate instalments in such amounts and on such

dates as are indicated in the applicable Pricing Supplement, subject

to any regulatory requirement including but not limited to the ECB

Guidelines.

Denomination of Notes: ................................ Notes will be issued in such denominations as may be agreed

between the relevant Issuer, (in the case of Guaranteed Notes) the

Guarantor and the relevant Dealer save that the minimum

denomination of each Note will be such as may be allowed or

required from time to time by the relevant central bank (or

A39729228 7

equivalent body) or any laws or regulations applicable to the

relevant Specified Currency.

Taxation: ....................................................... All payments of principal and interest in respect of the Notes,

Receipts and Coupons by the relevant Issuer or the Guarantor

(where relevant) will be made without withholding or deduction for

or on account of any present or future taxes, duties, assessments or

governmental charges of whatever nature (“Taxes”) imposed or

levied by or on behalf of any Relevant Jurisdiction unless such

withholding or deduction of Taxes is required by law. In such event,

the relevant Issuer or the Guarantor (where relevant) will pay such

additional amounts as shall be necessary in order that the net

amounts received by the holders of the Notes, Receipts or Coupons

after such withholding or deduction shall equal the respective

amounts which would otherwise have been receivable in respect of

the Notes, Receipts or Coupons, as the case may be, in the absence

of such withholding or deduction; except that no such additional

amounts shall be payable in relation to any payment with respect to

any Note, Receipt or Coupon in the circumstances as provided in

Condition 8 of the Terms and Conditions of the Notes.

Negative Pledge: ........................................... The terms of the Notes will contain a negative pledge provision as

further described in Condition 4 of the Terms and Conditions of the

Notes.

Events of Default: ......................................... The events of default applicable to the Notes are set out and further

described in Condition 10 of the Terms and Conditions of the

Notes.

Status of the Notes: ....................................... The Notes and any relative Receipts and Coupons are direct, senior,

unconditional and (subject to the provisions of Condition 4 of the

Terms and Conditions of the Notes) unsecured obligations of the

relevant Issuer and (subject as stated above) rank and will rank pari

passu, without any preference among themselves, with all other

outstanding unsecured and unsubordinated obligations of the

relevant Issuer, present and future, but, in the event of insolvency,

only to the extent permitted by applicable laws relating to creditors’

rights.

Guarantee: ..................................................... In the event the Notes are guaranteed by the Guarantor (the

“Guaranteed Notes”), the payment of principal and interest in

respect of the Guaranteed Notes and all other moneys expressed to

be payable by the relevant Issuer under or pursuant to the Trust

Deed will be unconditionally and irrevocably guaranteed by the

Guarantor (the “Guarantee”). The obligations of the Guarantor

under the Guarantee will constitute direct, senior, unconditional

and unsecured obligations of the Guarantor and (subject as stated

above) will rank pari passu with all other outstanding unsecured

and unsubordinated obligations of the Guarantor, present and

future, but, in the event of insolvency, only to the extent permitted

by applicable laws relating to creditors’ rights.

All guarantees by ONGC, as the Guarantor, which would be

applicable to the Notes when the Notes are issued by ONGC Videsh

or a Domestic Issuer shall be subject to the ECB Guidelines. All

A39729228 8

guarantees by ONGC, as the Guarantor issued by an Offshore

Subsidiary Issuer, shall be subject to the FEMA Guarantee Laws.

The Guarantor’s potential liability under the Guarantee of each

Series of Guaranteed Notes is capped at an amount equal to 109.00

per cent. of the total aggregate nominal amount of such Series of

Guaranteed Notes outstanding from time to time. Such aggregate

potential liability will (a) be increased in an amount equal to 109.00

per cent. of any increase in the aggregate nominal amount of such

Series of Guaranteed Notes outstanding and (b) be decreased in an

amount equal to 109.00 per cent. of any decrease in the aggregate

nominal amount of such Series of Guaranteed Notes outstanding,

in each case, concurrently with any such increase or decrease. The

Guarantor will comply with all requirements under applicable law,

including the ODI Regulations, that may be required to give effect

to such increase or decrease in its aggregate potential liability under

the Guarantee of each Series of Guaranteed Notes.

The Guarantee in respect of each Series of Guaranteed Notes shall

be in effect for the period commencing on (and including) the

relevant Issue Date and ending on (and including) the first

anniversary of the relevant Maturity Date (the “Guarantee

Period”). The Guarantee requires that demands under the

Guarantee must be received by the Guarantor within the Guarantee

Period. The Guarantee given by the Guarantor will be released upon

repayment in full of all amounts due under the relevant Series of

Guaranteed Notes.

Use of Proceeds: ........................................... The net proceeds from each issue of Notes will be applied by the

relevant Issuer for the purposes of meeting capital expenditure,

refinancing, working capital purposes, general corporate purposes

or any other purposes permitted in accordance with applicable laws

and regulations applicable to the relevant Issuer including but not

limited to the ECB Guidelines or the FEMA Guarantee Laws, or as

permitted by the RBI, and as may be set forth in the applicable

Pricing Supplement applicable to such Notes.

Rating: .......................................................... Where a Tranche of Notes is to be rated, its rating will not

necessarily be the same as the rating (if any) applicable to the

Programme and (where applicable) such rating will be specified in

the applicable Pricing Supplement.

A rating is not a recommendation to buy, sell or hold securities and

may be subject to suspension, change or withdrawal at any time by

the assigning rating agency.

Listing: .......................................................... Approval in-principle has been received from the SGX-ST for the

establishment of the Programme and application will be made to

the SGX-ST for the permission to deal in, and for the quotation of,

any Notes that may be issued pursuant to the Programme and which

are agreed at or prior to the time of issue thereof to be so listed on

the SGX-ST. Such permission will be granted when such Notes

have been admitted to the Official List of the SGX-ST. The SGX-

ST assumes no responsibility for the correctness of any of the

statements made or opinions expressed or reports contained herein.

A39729228 9

Admission to the Official List and quotation of any Notes on the

SGX-ST are not to be taken as an indication of the merits of the

Issuers, the Guarantor, their subsidiaries, their associated

companies, the Programme or the Notes. The Notes may also be

listed on such other or further stock exchange(s) as may be agreed

between the relevant Issuer, (in the case of Guaranteed Notes) the

Guarantor and the relevant Dealer in relation to each Series. If the

application to the SGX-ST to list a particular series of Notes is

approved, for so long as any Notes are listed on the SGX-ST and

the rules of the SGX-ST so required, such Notes listed on the SGX-

ST will be traded on the SGX-ST in a minimum board lot size of

S$200,000 (or its equivalent in other currencies).

Unlisted Notes may also be issued.

The applicable Pricing Supplement will state whether or not the

relevant Notes are to be listed and, if so, on which stock

exchange(s).

Governing Law: ............................................ The Notes and any non-contractual obligations arising out of or in

connection with the Notes will be governed by, and construed in

accordance with, English law.

Clearing System: ........................................... Euroclear, Clearstream, Luxembourg and/or any other clearing

system, as specified in the applicable Pricing Supplement (for

further information, see the section entitled “Form of the Notes”).

Selling Restrictions: ...................................... There are restrictions on the offer, sale and transfer of the Notes

under the Prospectus Directive and in the United States, the

European Economic Area, the United Kingdom, the Republic of

Italy, Japan, India, Hong Kong and Singapore and such other

restrictions as may be required in connection with the offering and

sale of a particular Tranche of Notes (for further information, see

the section entitled “Subscription and Sale”).

United States Selling Restrictions: ................ Regulation S, Category 1. TEFRA D, or TEFRA C rules or any

successor rules in substantially the same form that are applicable

for purposes of Section 4701 of the U.S. Internal Revenue Code of

1986, as amended, or TEFRA rules not applicable, as specified in

the applicable Pricing Supplement.

A39729228 10

INVESTMENT CONSIDERATIONS

Each investor should carefully consider the following investment considerations as well as the other

information contained in this Offering Circular and any pricing supplement prior to making an investment in

the Notes. In making an investment decision, each investor must rely on its own examination of the Company

and the terms of the offering of the Notes, including the merits and risks involved. The risks described below

are not the only ones that may affect the Notes. Additional risks not currently known to the Company or factors

that the Company currently deems immaterial may also adversely affect the Company’s business, financial

condition and results of operations. The market price of the Notes could decline due to any one or more of these

risks or such factors and all or part of an investment in the Notes could be lost.

Risks Relating to the Company’s Business

Fluctuations in crude oil prices may adversely affect the Company’s revenues and profits and a

substantial or extended decline in international prices for crude oil would have a material adverse effect

on the Company’s business, financial condition and results of operations.

Movements in the price of crude oil significantly affect the Company’s results of operations in both

upstream and downstream activities. Declines in crude oil prices may adversely affect the Company’s results

of operations, and substantial or extended declines may have a material adverse effect on the Company’s

business, financial condition and results of operations, including its liquidity and ability to finance planned

capital expenditure. Historically, international prices for oil have been volatile and have fluctuated widely in

response to changes in many factors. Lower oil prices may reduce the economic viability of projects planned

or in development. In addition, lower oil prices may result in the impairment of higher cost reserves and other

assets which may result in decreased earnings or losses. Conversely, the Indian Government’s mechanism for

sharing in the under-recovery by public sector oil marketing companies can reduce or eliminate any benefit

received by the Company with respect to increases in the price of crude oil. Rapid material and/or sustained

changes in oil, gas and refined product prices can impact the validity of the assumptions on which strategic

decisions are based and, as a result, the ensuing actions derived from those decisions may no longer be

appropriate. Periods of global recession, such as the global recession in 2008, could impact demand for the

Company’s products and the prices at which they can be sold and could affect the viability of the markets in

which it operates.

The prices the Company receives for its sales of crude oil are generally linked to international price

levels for crude oil. The prices the Company receives for crude oil produced from its nomination blocks are

also impacted significantly by the Company’s obligation to share in the under-recoveries of India’s public sector

oil marketing companies with respect to certain refined petroleum products. See the investment consideration

below titled “The requirement that the Company shares in the under-recovery of Indian oil marketing companies

as a result of Indian Government subsidies on SKO and LPG may adversely affect the Company’s results of

operations”. Crude oil and natural gas prices are also subject to external factors over which the Company has

no control, including product demand connected with global economic conditions, industry inventory levels,

production quotas imposed by the Organisation of Petroleum Exporting Countries (“OPEC”) and other major

oil producing countries, exchange rate fluctuations, weather-related damage and disruptions, competing fuel

prices, and regional supply interruptions or fears thereof that may be caused by military conflicts, civil unrest

or political uncertainty.

Fuel prices have been subject to high volatility and have historically fluctuated significantly. There can

be no assurance that global economic conditions and such political instability will not have an impact on crude

oil pricing in the future, which could materially and adversely impact the Company’s operations, both

domestically and internationally.

A39729228 11

Since crude oil is the largest cost component of refined products, one of the key economic risks of

companies in the refinery business pertains to refining margins. The Company’s refining margins are primarily

determined by the difference between the cost of crude oil and the prices of petroleum products produced by it.

Refining margins are also affected by the global and regional supply-and-demand balance for refined products

and by changes in the price of crude oil used for refinery feedstock. Consequently, the Company’s refining

business is also susceptible to fluctuations in crude oil prices. The movements in crude oil prices are also

accompanied by movements in product-crude cracks which consequently impact the margins. The Company

has historically sourced a substantial portion of its crude oil feedstock for its refining operations from the Middle

East, including Iran. Consequently, the Company’s refining business may be particularly susceptible to regional

supply interruptions, or fears thereof, that may be caused by military conflicts, civil unrest or political

uncertainty in the region. In addition, during periods of sharply increasing crude oil prices, refining margins

may be adversely affected and the Company may in turn suffer losses in its refining operations.

Any such fluctuations in crude oil prices may adversely affect the Company’s results of operations, and

a substantial or extended decline in international prices for crude oil may have a material adverse effect on the

Company’s business, results of operations and financial condition.

The requirement that the Company shares in the under-recovery of Indian oil marketing companies as

a result of Indian Government subsidies on SKO and LPG may adversely affect the Company’s results

of operations.

The Government has historically sought to control inflation and achieve other social and economic

objectives through intervention in prices of India’s public sector oil marketing companies (such as Bharat

Petroleum Corporation Limited (“BPCL”), Indian Oil Corporation Limited (“IOCL”)) for petroleum and gas

products such as motor spirit (“MS”) (until June 2010), high speed diesel (“HSD”) (until October 2014), LPG

for domestic use and superior kerosene oil sold under the public distribution system (collectively, “Controlled

Products”). The price caps are revised by the Indian Government from time to time. As a result, BPCL, IOCL

and the Company, via its subsidiary, Hindustan Petroleum Corporation Limited (“HPCL”), incur under-

recoveries when they sell their above-mentioned products at a regulated price. The Government has the ultimate

discretion to regulate the prices at which the Company may sell its controlled products.

The Indian Government operates a mechanism pursuant to which these under-recoveries are shared

among the Indian Government, the public sector oil marketing companies and the public sector upstream

companies (which includes the Company, Oil India Limited (“OIL”) and Gail (India) Limited (“GAIL”)).

The Indian Government has taken significant financial measures to reduce the burden of total under-

recoveries, such as by deregulating the price of MS in June 2010 and HSD for bulk consumers in January 2013.

The Indian Government has also capped the number of subsidised cylinders to consumers. Between 2014 and

2015, in order to prevent the misuse of LPG subsidy, the Indian Government launched the “Direct Benefits

Transfer for LPG Consumers Scheme” for the transfer of LPG subsidy directly into the bank accounts of

consumers. The Indian Government also deregulated the price of HSD in October 2014. These measures have

led to a significant reduction in total under-recoveries of oil marketing companies. Pursuant to Indian

Government directives, the public sector upstream companies shared under recoveries till June 2015.

The average price of Bonny Light Crude increased from U.S.$50.03 per barrel in the 2017 Fiscal Year

to U.S.$57.97 in the 2018 Fiscal Year and further increased to U.S.$71.60 in the 2019 Fiscal Year. The Company

realised prices of U.S.$50.27 (including VAT/CST) in the 2017 Fiscal Year, U.S.$57.33 (including VAT/CST)

in the 2018 Fiscal Year and U.S.$70.84 (including VAT/CST) in the 2019 Fiscal Year. The share of under-

recoveries for public sector upstream oil companies for the 2019 Fiscal Year was nil. The Company’s share of

under-recoveries was nil. Since the allocation of under-recoveries by the Ministry of Petroleum and Natural

Gas, Indian Government (the “MoPNG”) may vary from year to year, the allocations of under-recoveries for

A39729228 12

the 2019 Fiscal Year may not be indicative of the amount of under-recoveries for future years and there remains

unpredictability as to the share of the under-recovery that may be allocated in the future to the upstream oil

companies both individually and as a group. In addition, the Indian Government may introduce other regulations

relating to the pricing of petroleum products that could have a material adverse effect on the Issuer’s business,

financial condition and results of operations. There can be no assurances as to the form of any future regulation

implemented by the Indian Government relating to the under-recovery sharing mechanism, the pricing of

petroleum products or as to their impact on the Company’s business, financial condition and results of

operations.

The Company’s crude oil and natural gas reserves estimates involve a degree of uncertainty and may

not prove to be correct over time. Moreover, these estimates may be unaudited or may not be fully

audited and may not accurately reflect actual reserves or, even if accurate, technical limitations may

prevent the Company from producing crude oil or natural gas from these reserves.

Evaluations of crude oil and natural gas reserves involve multiple uncertainties and require exploration

and production companies to make extensive judgements as to future events based upon available information.

Crude oil and natural gas reserves data are estimates based primarily on internal technical analyses using

standard industry practices. Such estimates reflect the Company’s best judgement at the time of their

preparation, based on geological and geophysical analyses and appraisal work (processes that are continual and

yield new results over time), and may differ from previous estimates.

Reserves estimates are subject to various uncertainties, including those relating to the reservoir

parameters of crude oil and natural gas fields. These reservoir parameters may be difficult to estimate and, as a

result, actual production may be materially different from current estimates of reserves. Factors affecting the

Company’s reserves estimates may also include: new production or drilling activities; assumptions regarding

future performance of wells and surface facilities, field reviews, the addition of new reserves from discoveries

or extensions of existing fields, the application of improved recovery techniques and changed economic

conditions.

The reliability of reserves estimates also depends on the quality and quantity of technical and economic

data, the production performance of the fields, and consistency in oil and gas policies of the Indian Government

and the governments of other countries where the Company has operations. The quantities of crude oil and

natural gas that are ultimately recovered could be materially different from the Company’s reserves estimates,

and downward revisions of its estimates could affect its results of operations and business plan. Published

reserves estimates may also be subject to correction due to the subsequent application of published rules and

guidance.

The Company’s reporting policy is not, and is not required to be, derived from, or consistent with, oil

and gas reserves reporting requirements for filings with the U.S. Securities and Exchange Commission (the

“SEC”) and differs from such requirements in certain material respects. The Company’s stated reserves would

differ from those described herein if determined in accordance with oil and gas reserves reporting requirements

for filings with the SEC. There are currently no clear regulations governing public disclosure of potential

reserves by oil and gas companies operating in India or their use in securities offering documents. The Company

can give no assurance that the reserves estimates upon which it has made investment decisions accurately reflect

actual reserves levels or, even if accurate, that technical limitations will not prevent it from retrieving these

reserves.

Further, the Company has provided certain estimates regarding crude oil and natural gas reserves in this

Offering Circular. These estimates are based solely on volumetric analysis of the Company’s various licence

areas and are not used by it as the primary basis for development capital expenditure decisions.

A39729228 13

In calculating the Company’s domestic reserves, until 31 March 2018, the Company had used internally

developed definitions based on the reserves estimation definitions of the Society of Petroleum Engineers 1987

Standards (“SPE 1987 Standards”). The SPE 1987 Standards used by the Company were subsequently

replaced by the PRMS 2018 after 31 March 2018. The Company has suitably modified developed reserves

estimation definitions internally to take into account PRMS 2018. As the Company’s internally-developed

definitions do not strictly comply with currently accepted international standards, its reserves estimates may

not be comparable with other publicly listed companies. The Company’s international reserves have been

calculated based on standards that vary according to the jurisdiction in which the operator and reserves are

located. The Company’s domestic and international management estimates of the reserves are approved by the

Reserve Estimate Committee (“REC”), which includes all basin managers, asset managers, heads of all

exploration institutes and other relevant members and is chaired by the Director (Exploration) of the Company.

The Company’s domestic reserves (other than domestic reserves held through joint ventures) have historically

been audited independently every five years. However, there can be no assurance that the Company will conduct

such audits every five years in the future. There are certain variances between the Company’s last audited

proved developed reserves and its REC-approved management estimates of such reserves, which is attributable

primarily to differences in the definitions used to assess reserves. During the 2018 Fiscal Year, third party

certification was carried out by an independent consulting firm, M/s DeGolyer and MacNaughton, in respect of

the reserves of 70 major fields of the Company. Results of such certification indicated that the variation with

respect to the Company in proved developed reserves was -4.23 per cent. and in proved reserves was +1.70 per

cent., both of which were well within the 10.00 per cent. tolerance limit as per international practice. The

proportion of proved developed reserves to total proved reserves, and proved undeveloped reserves to total

proved reserves, is a significant factor in accounting for depletion and net producing assets in the Company’s

financial statements. Depletion is calculated as the product of the value of the producing asset and the

production volume of the asset, divided by the proved developed reserves of such asset. In the event of a

downward revision in the Company’s proved developed reserves, depletion expenses in respect of the relevant

producing field will increase, resulting in reduced profitability. Moreover, such downward revision in the

Company’s proved developed reserves will result in the Company’s balance sheet recording a decline in net

producing assets. At the same time, an increase in the proportion of proved undeveloped reserves to total proved

reserves would indicate higher capital expenditure to be incurred in developing such reserves compared to

proved developed reserves, which primarily requires operating expenditure and not capital expenditure.

The Company has had to cease operations at the Greater Pioneer Operating Company and Block 5A in

South Sudan because of the threat from recurrence of violence in South Sudan.

As of 31 March 2019, the Company held 25.00 per cent. participating interest in Blocks 1a, 1b and 4 in

South Sudan operated by the Greater Pioneer Operating Company (“GPOC”) and 24.125 per cent. participating

interest in Block 5A (South Sudan), which is operated by Sudd Petroleum Operating Company (“SPOC”). For

details, see “Business—The Company’s Principal Producing Areas—International Producing Areas—Sudan—

Greater Nile Oil Project” and “Business—The Company’s Principal Producing Areas—International

Producing Areas—South Sudan—Block 5A”.

Owing to geo-political issues between Sudan and South Sudan, the production from Blocks 1a, 1b and

4 were shut down for 15 months from January 2012 to March 2013. While oil production resumed for a brief

period from April 2013 to December 2013, Blocks 1a, 1b and 4 were subsequently shut down again for another

56 months from December 2013 to August 2018 due to the adverse security situation in South Sudan. Following

improvements to the security situation, a decision was made by the Ministry of Petroleum, Republic of South

Sudan and foreign partners to commence production resumption activities on a fast track basis in respect of

Blocks 1a, 1b and 4. After repairs were made to the damaged facilities at Blocks 1a, 1b and 4, the first oil

production was made from the Toma South field on 25 August 2018 and exports to the Marine Terminal

commenced from 15 September 2018. Since then, oil production from the Unity field, EL-Nar field and El-

A39729228 14

Toor field were also put into production on 31 December 2018, 30 April 2019 and 30 May 2019 respectively.

As of the date of this Offering Circular, GPOC is producing approximately 49,000 barrels of oil on a daily basis

with further ramping up of production in progress as well.

In respect of Block 5A in South Sudan, production from Block 5A in South Sudan was shut down for 15

months from January 2012 to March 2013. While oil production resumed for a brief period from April 2013 to

December 2013, Block 5A was subsequently shut down again due to the adverse security situation in South

Sudan. Following improvements to the security situation, a decision was made by the Ministry of Petroleum,

Republic of South Sudan and foreign partners to commence production resumption activities on a fast track

basis in respect of Block 5A. The technical assessment and environment assessment of Tharjath and Mala oil

fields of Block 5A were completed in February 2019. As of the date of this Offering Circular, Block 5A remains

in the process of completing its pre-resumption activities prior to continuing its oil production.

There can be no certainty as to when violence may recommence, and any prolonged halt of operations

in the GPOC and Block 5A in South Sudan will have a material adverse effect on the Company’s business,

financial condition and results of operations.

Some of the Company’s Indian and international interests are located in politically and economically

unstable areas which create security risks that have disrupted its operations in the past and could do so

in the future.

The Company faces security risks in some of its assets and basins in Assam, Nagaland and Tripura,

which are located in the North East region of India. The Company has suffered the adverse effects of insurgency,

terrorism and civil strife in the region, and its oil installations have been targeted by insurgent groups. The

Company has had several instances of attacks against its staff, including the kidnapping and killing of its

officials in the North East region. The Company has experienced interruptions in its production and exploration

activities due to these attacks. In other politically sensitive areas of India where it believes that there are

hydrocarbon reserves, for instance Nagaland, the Company has been unable to carry on exploration activities

because of the risk of insurgency or terrorism. In addition, the Company’s offshore installations in the open

seas, such as in the Western Offshore resource province, are vulnerable in the event of acts of war or terrorism

directed towards India. Minor security concerns throughout India include instances of oil pilferage, equipment

sabotage and theft, which have an adverse effect on its operations.

The Company has limited insurance coverage for losses arising from war, civil war, revolution, rebellion,

civil strife, riot, strike, and malicious and terrorist damage. For further details, see “Business—Insurance”. The

Company’s onshore insurance policy does not provide coverage for damage to insured properties arising out of

total or partial cessation of work, or retardation, interruption or cessation of any process or operations arising

from such risks. Accordingly, the Company may remain susceptible to security threats that may have an adverse

effect on the conduct of its operations.

The Company also has operations in countries where political, economic and social transition is taking

place. Some countries have experienced political instability, changes to the regulatory environment,

expropriation or nationalisation of property, civil strife, strikes, acts of war and insurrections. Any of these

conditions occurring could disrupt or terminate its operations, causing the Company’s development activities

to be curtailed or terminated in these areas or its production to decline and could cause the Company to incur

additional costs.

The Company has participating interests in assets located in various countries, including Libya, Sudan,

South Sudan, Iran, Syria, Brazil, Venezuela, Iraq, Vietnam, Myanmar, Bangladesh, Mozambique, Colombia,

Azerbaijan, Kazakhstan, Russia, New Zealand, Israel, Namibia and UAE many of which have experienced

instability in the recent past, or may experience instability in the future, which may have a material adverse

effect on its operations in these countries. For example, the Company’s operations in respect of its exploratory

A39729228 15

blocks in Libya and Iraq were affected due to adverse geopolitical conditions. The Company’s production and

development assets in Venezuela were affected due to the severe socio-economic conditions in Venezuela

including severe hyperinflation, and severe shortage of manpower, services and materials which were further

aggravated by recent U.S. sanctions. In addition, while the Company had made a discovery of gas in Farzad-B

block in Iran, further activities and negotiations with Iranian authorities could not be advanced further due to

the imposition of stringent U.S. sanctions, where internationally renowned consultants have been deterred from

working on the project in light of such sanctions having been imposed.

The oil industry is subject to regulation and intervention by governments throughout the world in such

matters as the award of exploration and production interests, the imposition of specific drilling obligations,

environmental and health and safety protection controls, controls over the development and decommissioning

of a field (including restrictions on production) and, possibly, nationalisation, expropriation, cancellation or

non-renewal of contract rights. The Company buys, sells and trades crude oil and natural gas products in certain

regulated commodity markets. Failure to respond to changes in trading regulations could result in regulatory

action and damage to its reputation. The oil industry is also subject to the payment of royalties and taxation,

which tend to be high compared with those payable in respect of other commercial activities, and operates in

certain tax jurisdictions that have a degree of uncertainty relating to the interpretation of, and changes to, tax

law. As a result of new laws and regulations or other factors, the Company could be required to curtail or cease

certain operations, or it could incur additional costs.

If the Company fails to acquire or find and develop additional reserves, or if it fails to redevelop existing

fields, its reserves, production and profitability may decline materially from their current levels over

time.

Successful execution of the Company’s strategy depends critically on sustaining long-term reserves

replacement. If upstream resources are not progressed in a timely and efficient manner, the Company will be

unable to sustain long-term replacement of reserves. The majority of the Company’s proved reserves are in the

western offshore area of India, including Mumbai High field, which are all maturing resource provinces. The

Company’s nomination blocks have suffered a decline in production which was offset primarily by production

from its joint venture blocks and its international projects. Unless the Company conducts successful exploration

and development (or redevelopment) activities or acquires properties containing proved reserves, or both, its

proved reserves will decline over time as existing reserves are depleted. For example, Mumbai High field has

been a major producing field since 1976 and accounted for approximately 37.93 per cent. of the Company’s

total domestic crude oil and 20.20 per cent. of its natural gas production from its owned and operated fields in

the 2019 Fiscal Year (excluding its share of production by its joint venture entities). After initial development

and recording its peak annual production in the 1990 Fiscal Year, Mumbai High field has experienced declining

production levels of domestic crude oil. In the 2017 Fiscal Year, the 2018 Fiscal Year and the 2019 Fiscal Year,

the Company’s Mumbai High field produced 8.947 MMT (67.10 MMbbls), 9.091 MMT (68.18 MMbbls) and

8.008 MMT (60.06 MMbbls) of crude oil and 4.582 BCM, 4.879 BCM and 4.999 BCM of natural gas,

respectively. While the Company introduced a plan for the redevelopment of the Mumbai High field during

2000-2001 for improved and enhanced oil recovery and augmentation of production facilities to maintain

production, it continues to experience significant time and cost overruns on some of its on going projects. If the

Company’s efforts to implement methods of enhancing production in mature reserves are not successful,

production in those reserves will gradually decline.

The Company’s future production will be highly dependent upon its success in acquiring or finding and

developing additional reserves in a timely and cost-effective manner and doing so will be increasingly

challenging because development and redevelopment of mature fields require increased levels of expenditure.

Additionally, the Company may fail to obtain sufficient data, or under-exploit its existing reserves and

exploration acreages in a manner that impairs its ability to develop or redevelop fields, which could cause its

A39729228 16

reserves and production to decline. If it is unsuccessful in acquiring or finding and developing reserves or

redeveloping its existing field, its reserves and production will decline, and its costs will increase, which will

adversely affect its business, financial condition and results of operations.

The Company’s failure to adequately estimate the value of and effectively exploit the crude oil and

natural gas assets it acquires may adversely impact its business, results of operations, growth and

profitability.

The Company has made significant acquisitions of oil and gas assets in recent years and is continually

evaluating acquisition opportunities as part of the Company’s growth strategy to exploit its existing overseas

exploration and production acreage, pursue attractive opportunities to acquire or obtain participation interests

in additional assets, and obtain exploration and development concessions in various overseas locations. Except

as disclosed in this Offering Circular, the Company has not entered into any definitive agreements with respect

to acquisitions of any new assets; however, should the Company decide to do so, it may make significant

investments which may not result in favourable returns due to, among other things, the uncertainties inherent

in the nature of the Company’s business for such acquisitions.

Each of the Company’s acquisitions will involve a number of challenges and uncertainties commonly

encountered in making acquisitions of crude oil and natural gas assets of this nature, which may impact the

Company’s investments in new assets, including:

reliability of given data in making accurate evaluations and estimates of reserves and production rates

of the assets it acquires;

inadequacy of technical data and undertaking adequate due diligence of risks relating to the assets;

planning for unforeseen technical and operating difficulties and expenditures, including assimilating the

operations, systems and personnel associated with the acquired assets;

role of local partners and or consortia parties to mitigate risks associated with the Company’s

acquisitions and overseas operations;

managing, reorganising, expanding or otherwise modifying existing operations to meet future production

needs;

complying with various local and international industrial standards and guidelines applicable to the

assets it acquires; and

changes in local tax laws.

In view of the various technical and commercial risks that are inherent in the Company’s core business

of exploration and exploitation of hydrocarbon resources, if it is unable to estimate accurately the value of or

effectively exploit the oil and gas assets it acquires, the anticipated benefits of the Company’s acquisitions may

not be fully realised, if at all, and it may become subject to increased costs and liabilities, which could have a

material adverse effect on the Company’s business, financial condition and results of operations.

Any failure by the Company to effectively identify, manage and integrate acquisitions successfully could

adversely affect its results of operations, business and prospects.

The Company has made acquisitions of crude oil and natural gas assets in recent years and continues to

evaluate merger and acquisition opportunities in India and internationally. It seeks to exploit its existing

overseas exploration acreage, pursue attractive opportunities to acquire or obtain participation interests in

additional assets, and obtain exploration and development concessions in various overseas locations which may

require significant investments. However, the Company may not be able to realise fully all the anticipated

A39729228 17

benefits of any acquisitions within the anticipated time frame or at all due to factors that are beyond its control.

In particular, such acquisitions involve a number of uncertainties and risks, including:

unforeseen contingent risks or latent liabilities relating to these businesses that may become apparent

only after the merger or acquisition is completed;

integration and management of the operations and systems; and

regulatory challenges for completing and operating the acquired crude oil and natural gas assets.

Part of the Company’s growth strategy includes pursuing strategic acquisitions and alliances. However,

if the Company is unable to integrate successfully the operations of acquired assets or businesses in line with

its strategy, establish successfully and operate joint ventures in connection with such acquisitions and alliances,

derive favourable returns from its acquisitions, or manage such future acquisitions profitably, the Company’s

growth plans may not be met and its cash generation and profitability may decline and in turn these could have

a material adverse effect on the business, results of operations and financial condition of the Company. Any

acquisition that the Company makes may result in the assumption of material liabilities. Any assets that the

Company acquires may subject it to increased costs and liabilities, including environmental liabilities. The costs

and liabilities associated with unknown risks may be greater than expected, and the Company may assume

unforeseen contingent risks or latent liabilities that become apparent only after the acquisition is completed.

Foreign acquisitions involve risks in addition to those mentioned above, including those related to integration

of operations across different languages, currency risks and the particular economic, political and regulatory

risks associated with specific countries.

The Company encounters significant competition from other crude oil and natural gas companies in

all areas of its operations, which may adversely affect its business.

The crude oil and natural gas industry is highly competitive. There is strong competition, especially with

respect to acquiring rights to explore new sources of crude oil and natural gas in India.

Since 1999, exploration acreages in India have been offered by the Indian Government through

competitive bidding processes pursuant to the New Exploration Licensing Policy (“NELP”) and, since 2016,

the Hydrocarbon Exploration Licensing Policy (“HELP”). These policies have increased competition by

inviting private participation, both domestic and international, in oil and gas exploration.

Although the Company continues to conduct exploration activities in its nomination blocks and other

blocks acquired prior to NELP, since 1999 all of its exploration blocks have been awarded in the NELP or

subsequently, the HELP bidding rounds, and its acquisition of new domestic exploration acreage will continue

to depend on its ability to compete successfully in HELP or successor competitive bidding programmes.

The Indian Government allows for 100.00 per cent. foreign direct investment in exploration activities

conducted in India. This further encourages foreign oil companies to invest in India and increases the

competitive environment for the acquisition of licences for exploratory prospects in India. Domestic crude oil

and natural gas companies, as well as global crude oil majors, may seek to enter or further expand their presence

in the oil and gas exploration and production industry in India, which could result in increased competition that

could adversely affect the Company’s business by limiting the number of new exploration blocks that will be

available to them in the future.

In particular, some of the Company’s potential foreign competitors are much larger and more established

companies with substantially greater resources. In addition, the Company increasingly faces significant

competition in acquiring global assets from national oil companies of other countries. These companies may be

able to bid more aggressively for exploration blocks and may be able to acquire a greater number of properties

and prospects, including operatorships and licences abroad, than the Company is able to acquire. The

A39729228 18

Company’s ability to compete is also limited by certain regulations relating to its status as a public sector

undertaking (“PSU”). For instance, under purchase preference policies, the Indian Government mandates that

public sector enterprises such as the Company give preference to other public sector enterprises over private

sector companies on bids for the Company’s contracts.

The Open Acreage Licensing Policy (“OALP”) was launched by the Indian Government in June 2017

as part of HELP. Under OALP, potential investors and companies were permitted to carve out acreages of their

own choice and submit an expression of interest which would be subjected to competitive bids called for by the

Indian Government, thereby rewarding initiative and encouraging participation. Other features of OALP also

include the marketing and pricing freedom granted to producers, revenue sharing model uniform and licensing

for all forms of hydrocarbons. The Company expects that OALP will enhance competition for India’s

exploration acreages and permit increased competition from smaller crude oil and natural gas companies. Since

the launch of OALP, there have been three rounds of bidding to date. As of 1 April 2019, the Company was

awarded two exploration blocks covering 1,456 square kilometres (“sq. km.”) from the first round of the

bidding. The Indian Government approved the discovered small field (“DSF”) policy in 2016 with the objective

of bringing DSFs to production at the earliest to enhance domestic production under the revenue sharing

contract. The Company did not participate in the first round of the DSF bid in 2016. In the second round of the

DSF bid in 2018, the Company was awarded five contract areas of DSF.

The implementation of the Company’s strategy requires continued technological improvement and

innovation, including improvement in exploration, production, refining, petrochemicals manufacturing

technology and advances in technology related to energy usage. The Company’s performance could be impeded

if competitors develop or acquire intellectual property rights to technology that it requires or if the Company’s

innovation lags behind that of its industry.

In addition, the Company also faces competition from other petroleum companies both domestic and

elsewhere in the world in the downstream segment of the oil and gas industry market. The continued

deregulation and liberalisation of industries in India, when combined with any reductions in customs duties and

import tariffs, could lead to increased competition from other international or domestic petroleum companies

(including other public sector oil marketing companies). Competition could also cause price reductions, reduce

the Company’s margins or result in a loss of market share for the Company’s products and services which in

turn could adversely affect the Company’s business, financial condition and results of operations.

The Company may encounter problems relating to its joint venture partners or project development

partners which could adversely impact its strategy, business and results of operations.

The Company has investments in various strategic joint ventures and project development partners,

which have been established to support its crude oil and natural gas exploration and production business and to

expand its exploration and production (“E&P”) operations in India and internationally. The Company’s

business is therefore, dependent on developing and maintaining continuing relationships with its current or

potential strategic joint venture and project development partners. The Company’s relationship with joint

venture partners or project development partners subjects the Company to risks. Such joint venture partners or

project development partners may:

have business interests or goals that may differ from the Company’s business interests or goals, or those

of its shareholders;

take actions contrary to the Company’s instructions or requests or contrary to its policies or objectives;

be unable or unwilling to fulfil their obligations under the relevant joint venture or co-operation

agreements;

have financial difficulties which in turn expose the Company to potential credit risk; or

A39729228 19

have disputes with the Company which may cause delays in completion or the suspension or

abandonment of the joint venture or partnership.

Any actual or perceived deterioration in the reputation of the Company’s joint venture partners or project

development partners could also have an adverse impact on the Company’s reputation and business operations.

Any of the foregoing may have an adverse effect on the Company’s business, prospects, financial condition and

results of operations and its ability to implement its growth strategy.

In line with the Company’s growth strategy, the Company intends to continue to pursue suitable joint

venture and strategic partnership opportunities in India and internationally. The Company may not be able to

identify suitable joint venture or strategic partners or it may not complete transactions on terms commercially

acceptable to it, or at all. The Company is not able to make any assurances that it will be able to form such

alliances and ventures successfully or realise the anticipated benefits of such alliances, joint ventures or

partnerships. Any unforeseen costs or losses could adversely affect the Company’s business, profitability and

financial condition.

The Company is subject to a variety of business, legal, regulatory, economic, social and political risks

associated with its international operations.

The Company has participating interests in assets located in various countries, including Libya, Sudan,

South Sudan, Iran, Syria, Brazil, Venezuela, Iraq, Vietnam, Myanmar, Bangladesh, Mozambique, Colombia,

Azerbaijan, Kazakhstan, Russia, New Zealand, Israel, Namibia and UAE. These international operations expose

the Company to a variety of risks, including risks arising from:

potential for political and civil unrest, war or acts of terrorism in countries in which the Company

operates such as Iraq, Iran, Libya, Sudan, South Sudan, Syria and Myanmar. Countries across North

Africa and the Middle East have experienced widespread civil unrest, socio-economic unrest and

violence since 2011. Venezuela has also experienced civil unrest in recent years;

decrease in reserves estimates as a result of assets being lost due to political risk, which is not accounted

for in the Company’s reserves estimates;

difficulties in staffing and managing multiple international locations;

any need to obtain governmental approvals and permits under unfamiliar regulatory regimes;

increased costs resulting from the need to comply with complex foreign laws and regulations, including

those relating to payment of royalty, exploration and development of crude oil and natural gas reserves,

trade restrictions, labour relations, environmental regulations, tax laws and other local laws that apply

to the Company’s international operations;

imposition of, or unexpected adverse changes in, the laws, regulatory requirements or trade policies of

foreign governments;

inconsistent application of laws and regulations by courts or applicable regulatory bodies in the countries

in which the Company operates;

increased exposure to foreign currency exchange rate risk, particularly in the U.S. dollar;

restrictions on transfer of funds into or out of a country;

inability to obtain adequate insurance;

inability to maintain or enforce legal rights and remedies, including those relating to intellectual property

and trade secrets, at a reasonable cost or at all;

A39729228 20

challenges caused by distance, language and cultural differences and by doing business with foreign

agencies and governments;

credit risk and higher levels of payment fraud;

potentially adverse tax consequences; and

risks of expropriation, nationalisation, renegotiation, forced change or nullification of existing contracts

or royalty rates, unenforceability of contractual rights, foreign government regulations that favour or

require awarding of contracts to local contractors or require foreign contractors to employ citizens of, or

purchase supplies from, a particular jurisdiction.

The Company may be unsuccessful in developing and implementing policies and strategies that will be

effective in managing these risks in each country where it does business or plans to do business. For example,

the Company has significant overdue receivables in Sudan and Venezuela. The Company’s failure to manage

these risks successfully could adversely affect its business, financial condition and results of operations.

Furthermore, it may face competition in other countries from companies that have greater operating experience

in such countries or with international operations generally.

Certain countries in which the Company operates, such as Libya, Iran, Iraq, Russia, Sudan, South

Sudan, Syria and Venezuela, are subject to U.S. and international trade restrictions, economic

embargoes and sanctions.

The Company conducts business activities with countries and persons that are subject to sanctions

administered or enforced by the U.S. Department of Treasury’s Office of Foreign Assets Control (“OFAC”),

the U.S. Department of State, the United Nations Security Council, the European Union (the “EU”) and Her

Majesty’s Treasury of the United Kingdom.

Specifically, the Company, directly or through its subsidiaries, deals with a number of entities that are

targeted by the United States and other sanctions programmes targeting Iran, Syria and Venezuela. In addition,

the Company, as of 31 March 2019, indirectly held a 26.00 per cent. equity interest in JSC Vankorneft, a

subsidiary of Rosneft Oil Company, which are both on the OFAC Sectoral Sanctions Identifications List

maintained under the U.S. Russian sanctions programme. The Company also participates in other projects and

activities in certain of those and a number of other countries or regions subject to heightened sanctions

enforcement and scrutiny, including Libya, Iraq, South Sudan and Sudan. There can be no assurance that further

sanctions will not adversely affect the Company’s operations in these or other countries or regions and that

investors in the Notes will not incur reputational or other risk as a result of the Company’s or Company’s

dealings with sanctioned persons, entities or countries.

As of and for the 2019 Fiscal Year, total assets in, and operating revenue from Libya, Iran, Iraq, Russia,

Sudan, South Sudan, Syria and Venezuela accounted for 12.01 per cent. (of which Russia constituted 9.42 per

cent.) and 2.45 per cent. (of which Russia constituted 2.07 per cent.) of the Company’s consolidated assets and

consolidated operating revenues, respectively. For the 2020 Fiscal Year, the Company’s budgeted capital

expenditure in these countries is estimated to be approximately Rs. 32,765 million, representing approximately

8.60 per cent. of budgeted capital expenditure of the Company (non-consolidated) and ONGC Videsh. The

Company’s activities with respect to these countries and persons subject the Company and its shareholders to

a number of risks.

Existing sanctions against Iran, Syria and the region of Crimea present challenges in conducting normal

business operations, including international financial transfers. If these sanctions were to expand further, either

in severity or in terms of the range of countries applying them, it could have a material adverse impact on the

Company’s ability to conduct business in or with any of these countries. In addition, the United States maintains

comprehensive primary sanctions with respect to the following countries: Cuba, Iran, North Korea and Syria,

A39729228 21

as well as the region of Crimea. As an entity organised in India, the Company is generally not directly subject

to these primary sanctions, except to the extent that it engages in activities that occur within the United States.

However, the United States also maintains a secondary sanctions regime applicable to persons worldwide who

knowingly engage directly or indirectly in certain activities in Iran and Russia or involving certain Iranian and

Russian counterparties or with certain other designated persons or entities.

The United States’ implementation of the Joint Comprehensive Plan of Action (the “JCPOA”) on 16

January 2016 resulted in the lifting of many of the United States’ secondary sanctions with respect to Iran’s

nuclear programme. It also resulted in the removal of a number of parties, including the National Iranian Oil

Company (“NIOC”), from the Special Designated Nationals and Blocked Persons List (the “SDN List”)

maintained by OFAC. The JCPOA had provided significant sanctions relief to Iran by suspending a number

U.S. secondary sanctions, including those U.S. secondary sanctions targeting the following activities: (i)

financial and banking transactions with some (but not all) Iranian banks and financial institutions; (ii) purchases

of Iranian crude oil; (iii) investment, including participation in joint ventures, goods, services, information,

technology and technical expertise and support for Iran’s oil, gas and petrochemical sectors; (iv) the purchase,

acquisition, sale, transportation or marketing of petroleum, petrochemical products and natural gas from Iran;

and (v) transactions with Iran’s energy sector, subject to certain limited conditions. The JCPOA also lifted the

majority of European Union and United Nations sanctions with respect to Iran as well.

On 8 May 2018, U.S. President Donald Trump announced his decision to cease U.S. participation in the

JCPOA, and to begin re-imposing, following certain wind-down periods, the U.S. sanctions that had been

suspended pursuant to the JCPOA. In conjunction with this announcement, the U.S. President issued a National

Security Presidential Memorandum directing the U.S. Secretary of State and the U.S. Secretary of the Treasury

to prepare for the re-imposition of all of the U.S. sanctions lifted or waived in connection with the JCPOA, to

be accomplished as expeditiously as possible and no later than 180 days from the date of the memorandum.

These changes fully came into effect on 4 November 2018. They are not retroactive, but they do affect any

transactions from the date of effectiveness. As a result, U.S. direct and secondary sanctions have returned to

their status prior to the implementation of the JCPOA, including secondary sanctions targeting financial and

banking transactions with Iranian banks and financial institutions, transactions with the Iranian energy sector

and transactions with an expanded list of Iranian specially designated nationals.

The United States also maintains sanctions with respect to individuals and entities identified on lists

administered by OFAC, including the Sector Sanctions Identifications List (the “SSI”), the SDN List, and the

Foreign Sanctions Evaders List (the “FSE List”). The EU and other authorities maintain similar lists, and the

individuals and entities identified on the SDN List, the SSI List, the FSE List and other similar lists are generally

referred to as Prohibited Parties. In addition, the EU and the United States target particular countries or

territories and persons or entities involved in certain transnational activities, such as terrorism, narcotics

trafficking, and proliferation of weapons of mass destruction. Under the United States programmes, these list-

based sanctions extend to entities that are directly or indirectly: (i) majority owned (50.00 per cent. or more) by

one or more individuals or entities identified on the SDN List or (ii) majority owned (50.00 per cent. or more)

by one or more individuals or entities identified on the SSI List pursuant to the same SSI directive. Individuals

or entities who engage in any transactions or dealings with individuals or entities identified on the SDN List or

the FSE List may themselves be subject to sanctions (including identification on such lists). Violations of U.S.

sanctions laws can result in substantial civil monetary and criminal fines and penalties, loss of business and

other licences, freezing or forfeiture of assets or funds involved in or derived from the violative conduct, and

reputational damage.

With respect to ONGC Videsh specifically, ONGC Videsh, directly or through its subsidiaries, holds

participating interests in exploration projects in Iran, Libya, Iraq and Myanmar, as well as discovered/producing

projects in Myanmar, Russia, South Sudan, Sudan, Syria and Venezuela.

A39729228 22

United States and EU sanctions, including those directed at United States and non-United States financial

institutions, have made banks reluctant to open letters credit or otherwise provide financial services in

connection with certain of these projects, particularly those in Iran and Syria. There can be no assurance that

certain financial institutions will not continue to avoid involvement in Iran-related transactions, even if

technically not prohibited by applicable sanctions.

In addition, while HPCL and Mangalore Refinery and Petrochemicals Limited (“MRPL”), subsidiaries

of the Company, do not sell or export refined oil products to any countries or persons that are subject to

sanctions, there can be no assurance that the counterparties to whom HPCL or MRPL sells or exports its refined

products will not on-sell or re-export such refined products to countries or persons subject to sanctions.

Furthermore, as a result of its business activities with countries and persons that are subject to

international sanctions, the Company may be subject to negative media or investor attention, which may distract

management, consume internal resources and affect certain international investors’ perceptions of the Company.

There can be no assurance that the Company will not increase its business in or with countries and persons that

are subject to international sanctions, particularly relative to its total business. This could have a negative

impact, including on its ability to raise money in international capital markets and on the international

marketability of its securities.

The Company intends to set up a segregated account, wherever required so that funds raised from

persons investing in this Offering are not commingled with funds for business activities in any country or with

any person or entity subject to U.S. or international trade restrictions, economic embargoes and sanctions.

Furthermore, the Company has confirmed with the Arrangers that none of the proceeds will be used in any

manner which would result in a violation of any U.S. or other sanctions and that they will apply all of the net

proceeds from the respective issuances under the Programme solely and exclusively for purposes permitted in

accordance with applicable laws and regulations.

The Company does business in jurisdictions with inherent risks relating to fraud, bribery and

corruption.

The Company currently does business in a number of jurisdictions that have been allocated low scores

on the Corruption Perceptions Index created by Transparency International such as India, Sudan, South Sudan,

Venezuela and Nigeria. Doing business in international developing markets brings with it inherent risks

associated with enforcement of obligations, fraud, bribery and corruption. Fraud, bribery and corruption are

more common in some jurisdictions than in others. In addition, the oil and gas industries have historically been

shown to be vulnerable to corrupt or unethical practices. While the Company maintains anti-corruption training

programmes, codes of conduct and other safeguards designed to prevent the occurrence of fraud, bribery and

corruption, it may not be possible for the Company to detect or prevent every instance of fraud, bribery and

corruption in every jurisdiction in which its employees, agents, sub-contractors or joint venture partners are

located. The Company may therefore be subject to civil and criminal penalties and to reputational damage.

Instances of fraud, bribery and corruption, and violations of laws and regulations in the jurisdictions in which

the Company operates could have a material adverse effect on its business, results of operations, financial

condition and prospects. In addition, as a result of the Company’s anti-corruption training programmes, codes

of conduct and other safeguards, there is a risk that the Company could be at a commercial disadvantage and

may fail to secure contracts within jurisdictions that have been allocated a low score on Transparency

International’s “Corruption Perceptions Index” to the benefit of other companies who may not have or comply

with such anti-corruption safeguards.

A39729228 23

Exploration activities in Russia involve numerous risks, including the risk that the Company’s crude

oil and natural gas fields in Russia will be re-assessed and declared as fields of “federal importance”.

In addition, the Company’s exploration and production licences in Russia may be suspended, amended

or terminated prior to the end of their terms, and it may be unable to obtain or maintain various permits

and authorisations.

The Company conducts some of its operations in Russia (Imperial Energy, Sakhalin and Vankor project

assets) through various Russian subsidiaries under a number of geological study, exploration and production

licences. The revenue from oil and gas production from these operations amounted to 1.60 per cent., 1.61 per

cent. and 2.07 per cent. of the Company’s consolidated revenue for the 2017 Fiscal Year, the 2018 Fiscal Year

and the 2019 Fiscal Year.

The Russian Federal Agency for Subsoil Use approves the list of fields of federal importance (the

“Strategic Fields List”). The Strategic Fields List does not include any licensing area within which the

Company’s Russian subsidiaries have the right to subsoil use. The reserves of the Company’s Russian

subsidiaries’ licensing areas are below the statutory threshold to be considered fields of “federal importance”.

Despite the fact that no field of the Company’s Russian subsidiaries has been qualified as a field of “federal

importance”, the volume of their reserves may be re-assessed in the future based on additional exploration

results. If, as a result of such reassessment, the natural gas and/or crude oil reserves meet the statutory criteria,

the relevant subsoil field may be included in the Strategic Fields List. Additionally, if during the process of

geological survey under exploration licences, the Company’s Russian subsidiaries discover that a particular

licensing area may contain resources that would render it a field of “federal importance”, the governmental

committee of the Russian Federation will be entitled to prohibit the use of such area by the Company’s Russian

subsidiaries if such use would “pose a threat to national security”. This would adversely affect the Company’s

prospects, operating results and financial condition.

Further, Russian licensing laws and regulations are unclear, contradictory and burdensome from a

licensee’s perspective. Even minor errors or omissions on the part of a licence holder in respect of any of its

licensing obligations could result in illegal subsoil use and, in certain cases, could lead to suspension or

termination of the licences or related contracts. The Law of the Russian Federation No. 2395-1, “On Subsoil”

dated 21 February 1992, as amended (the “Subsoil Law”), and many regulations issued thereunder govern

Russia’s licensing regime for the exploration, development and production of crude oil and natural gas. In

addition, the Company must obtain and maintain other licences, permits, authorisations, land use rights and

approvals to develop its fields, and must comply with on going requirements, such as maintaining utilisation

levels, in order to remain in compliance with such requirements. The Subsoil Law provides that fines may be

imposed, and licences may be suspended, restricted, or terminated, if any of the Company’s Russian subsidiaries

that hold a licence fails to comply with licence requirements or the Subsoil Law. In March 2016, licences of

five exploration and production blocks of LLC Allianceneftegaz (a member of the Imperial Group of

companies) were terminated prematurely due to failure to fulfil their minimum work programme. The Subsoil

Law also provides that licence holders may renew licences, so long as they are in compliance with their terms.

The Company may be unable to comply with certain licence agreement requirements for some or all of

these licence areas. For example, the Company’s utilisation levels at certain locations may not be in compliance

with the terms of the relevant licence agreement. If the authorities find that the Company has failed to fulfil the

terms of its licences, permits or authorisations, or if it operates in the Company’s licence areas in a manner that

violates Russian law, they may impose fines on the Company or suspend or terminate the Company’s licences.

Furthermore, the Company may have to increase spending to comply with licence terms. Any suspension,

restriction or termination of the Company’s licences could adversely affect its operating results and financial

condition.

A39729228 24

The Company’s inability to strengthen its internal control systems may have an adverse impact on its

business and results of operations.

The scale and scope of the Company’s operations require it to maintain sufficient and robust internal

control systems and an effective monitoring mechanism with respect to its operations. In particular, with respect

to the Company’s international exploration and production business operation, it is generally required to

conduct internal audits relating to its financial and operational activities. Although the Company has and

continues to implement such internal control systems to the extent possible, there can be no assurance that it

will be successful in developing and implementing policies and strategies that will be effective in managing

risks relating to its operations in India and internationally. The Company’s failure to manage these risks

successfully could adversely affect its business, financial condition and results of operations.

Business disruptions could seriously harm the Company’s future revenue and financial condition and

increase its costs and expenses.

The Company’s operations could be subject to war, expropriation, terrorism, earthquakes, power

shortages, telecommunications failures, water shortages, tsunamis, floods, hurricanes, typhoons, fires, extreme

weather conditions, medical epidemics, and other natural or manmade disasters or business interruptions. The

occurrence of any of these business disruptions could seriously harm the Company’s revenue and financial

condition and increase its costs and expenses. The ultimate impact on the Company, its significant suppliers

and its general infrastructure as a result of such natural or manmade disasters or business interruptions is

unknown, but its revenue, profitability and financial condition could suffer in the event of any such natural or

manmade disasters or business interruptions. While the Company has in place a corporate disaster management

plan which was implemented in 2009 and a unit level disaster management plan which was also implemented

in 2009 and last updated in 2018, there can be no assurance that the Company will be able to successfully

implement such disaster recovery plans effectively in a timely manner in the event that such disruption occurs.

The Company is exposed to risks brought about by asset concentration.

Mumbai High field, in the Western Offshore basin, has been a major producing field since 1976 and

accounted for approximately 37.93 per cent. of the Company’s total domestic crude oil and approximately 20.20

per cent. of its natural gas production from its owned and operated fields in the 2019 Fiscal Year (excluding its

share of production by its joint venture entities). In addition, Mumbai High field has been experiencing

declining production levels since 1990. The concentration of the Company’s proved plus probable crude oil and

natural gas reserves, as well as its crude oil production, increases its exposure to an event that could adversely

affect the development or production of crude oil and natural gas in a limited geographic area, including

catastrophic damage to wells, pipelines, installations, natural catastrophes, terrorist attacks and other acts of

violence or events that could result in the loss of its crude oil or natural gas reserves or impact the supply of its

crude oil and natural gas production. Therefore, its future production will be highly dependent upon its success

in acquiring or finding and developing additional reserves in a timely and cost-effective manner. If the Company

is unsuccessful, its total proved reserves and production will decline, which will adversely affect its results of

operations and financial condition.

The Company’s development, redevelopment and other projects have significant capital expenditure

requirements and involve many uncertainties and operating risks. Accordingly, they may not be

completed in a timely manner or at all, or may not operate as planned and, therefore, the Company may

not be able to realise profits from these projects and they may cause substantial losses.

The Company intends to make substantial additional investments in new projects for its expansion plans,

which will require significant capital expenditure. The Company will also need to incur capital expenditure

relating to its overseas exploration and development activities. The Company's capital expenditure plans are

A39729228 25

subject to a number of risks, contingencies and other factors, some of which are beyond the Company’s control,

including:

the Company’s ability to generate sufficient cash flows from operations and financings to fund its capital

expenditure, investments and other requirements or to provide debt or equity contributions to its

subsidiaries;

the availability and terms of external financing;

the Indian Government’s policies relating to foreign currency borrowings;

the amount of capital other Indian entities and foreign oil and gas companies may seek to raise in the

international capital markets; and

the cost of financing and the condition of financial markets.

In addition, the Company’s projects relating to its overseas exploration and development activities entail

exploration, engineering, technological upgrades, construction and other commercial risks, and the projects

currently contemplated by the Company may involve significant cost overruns, may not be completed in a

timely manner or at all, or may not operate as planned. The Company cannot assure you that it will not

experience similar cost overruns or delays in the expansion of its refinery or in the expansion or construction

of its various petrochemical plants, power plants or special economic zones. Any delays or cost overruns in any

of the Company’s projects may adversely affect its business, financial condition and results of operations.

The Company’s development projects may be delayed or may not be entirely successful for many

reasons, including financial constraints, cost overruns, lower crude oil and natural gas prices, equipment

shortages, mechanical and technical difficulties, the failure to obtain necessary governmental approvals, and

industrial action. These projects may also sometimes require the use of additional new and advanced

technologies, which can be expensive to purchase and implement, and may not function as expected.

In addition, some of the Company’s development projects are located in difficult environments, such as

the deep-water projects in the Arabian Sea and the Bay of Bengal, or involve challenging reservoirs, which can

exacerbate such problems. The Company has encountered delays and cost overruns in certain other

development projects due to factors such as inflation, foreign currency exchange rate fluctuations and

unanticipated conditions prevailing in the areas of development activity. There is a risk that other development

projects that the Company undertakes may suffer from similar or additional problems.

In the Company’s marginal fields in the Western Offshore resource province, where it is increasingly

developing smaller satellite fields with shorter life spans, it encounters the technological challenge of

establishing re-usable facilities and platforms, and also faces the challenge of remaining profitable. The

Company’s other development projects in mature fields, such as the heavy oil fields of Northern Gujarat where

enhanced and improved recovery techniques are being utilised, also face potentially higher operating costs and

capital expenditure. In addition, the Company’s development projects, particularly those in remote areas, could

become less profitable, or unprofitable, if it experiences a prolonged period of low oil or gas prices.

Hydrocarbons exploration is capital-intensive and involves numerous risks, including the risk that,

after substantial expenditure, the Company will encounter crude oil or natural gas reservoirs that may

not be commercially viable for production.

Finding oil and gas is an uncertainty in any exploration venture. Generally, only a few of the properties

that are explored are ultimately developed into hydrocarbon producing fields. There is no certainty of finding

commercial hydrocarbon deposits below the surface of the earth. Commercial deposits of hydrocarbon lie deep

in the bowels of the earth whose exact location and depth below the surface is the ultimate objective of

exploration work. Unfortunately, no instrument or methodology has yet been invented that would directly point

A39729228 26

to the existence of a commercially viable deposit. Present methods used in exploration are indirect probes whose

data are subject to interpretation or “best judgement”.

In addition, the business of hydrocarbon exploration involves a high degree of risk which even a

combination of experience, knowledge and careful evaluation may not be able to prevent. These risks include,

but are not limited to, encountering unusual or unexpected geological formations or pressures, seismic shifts,

unexpected reservoir behaviours, unexpected or different fluids or fluid properties, premature decline of

reservoir, uncontrollable flow of oil, natural gas or well fluids, equipment failures, extended interruptions due

to, among others, inclement or adverse weather conditions, environmental hazards, industrial accidents,

occupational and health hazards, mechanical and technical failures, explosions, pollution, oil seepage, industrial

action and shortages of manpower necessary to implement the Company’s development plans. These risks and

hazards could also result in damage to, or in the destruction of, production facilities, personal injury,

environmental damage, business interruption, monetary losses, and possible legal liabilities as well as delays in

other construction, fabrication, installation or commissioning activities.

The Company continues to explore various geographic areas in India, including new resource provinces

that are onshore, and deep-water projects in the Arabian Sea, the Bay of Bengal and the Andaman Sea, where

environmental conditions are challenging, limited data are available and costs can be higher. The Company has

limited experience in ultra-deep water exploration, which is a particularly high-risk and capital-intensive

activity. The Company also carries out exploration and development activities overseas in various countries

either as operators or as non-operators where it has limited control over expenditure and drilling decisions. In

addition, its use of advanced technologies requires high resolution surveys and infrastructure for interpretation,

which involve greater exploration expenditures than traditional exploration practices.

The cost of drilling, completing and operating wells may vary at times for reasons beyond the

Company’s control. As a result, the Company has in the past incurred, and may continue to incur, cost overruns,

or may be required to curtail, delay or terminate drilling operations because of a variety of factors, including

unexpected drilling conditions, pressure or variations in geological formations, equipment failures or accidents,

adverse weather conditions, compliance with governmental requirements, and shortages or delays in the

availability of drilling rigs and the delivery of equipment. The Company has encountered delays in domestic

exploration projects due to the failure of third party contractors hired for the project to complete their scope of

work in a timely manner, as well as delays and cost overruns due to factors such as inflation, foreign currency

exchange rate fluctuations and unanticipated conditions prevailing in the areas of exploration.

The Company’s overall drilling activity, or drilling activity within a particular project area, may be

unsuccessful. For example, it carried out exploration activities in Saurashtra onshore, the Bengal Basin and the

Ganga basin without any commercial success so far, and ONGC Videsh, by itself or together with its joint

venture partners, carried out exploration activities in many locations, including for projects in Egypt, Brazil,

Colombia, Cuba, Nigeria and Kazakhstan, without commercial discoveries. If such failures continue to occur

in the future, they may have a material adverse effect on the Company’s business, financial condition and results

of operations.

Hydrocarbon exploration is also capital intensive. Exploration and development of the existing assets

and acquisition of new assets may be dependent upon the Company’s ability to obtain suitable financing or

ability to generate sufficient cash from operations. There can be no assurance that such funding will be available

and, if such funding is made available, that it will be offered on economic terms suitable to the Company. Any

of the foregoing may have an adverse effect on the Company, and therefore the Company’s business, financial

condition and results of operations.

A39729228 27

The non-availability of crude oil and natural gas transportation infrastructure will affect the

Company’s ability to exploit its reserves in a cost-effective manner.

The Company’s ability to exploit any reserves discovered in a cost-effective manner will be dependent

upon, among other things, the availability of the necessary infrastructure to transport crude oil and natural gas

to potential buyers at a commercially acceptable price. Crude oil is usually transported by pipelines and ocean

tankers to refineries, and natural gas is usually transported by pipelines to processing plants and end users. For

example, the Company is currently conducting exploration and development activities in the deep waters of the

Bay of Bengal on the east coast of India where no suitable transportation arrangements exist, and infrastructure

will have to be built. The Company may not be successful in its efforts to arrange suitable infrastructure for the

cost-effective transportation of its potential production. Similarly, it lacks the infrastructure for natural gas

transportation, and is dependent on third party providers to transport natural gas produced from its fields. Failure

to develop its own natural gas transportation infrastructure, or to conclude natural gas transportation

arrangements on commercially favourable terms with third parties, could result in higher transportation costs,

thereby reducing the Company’s profitability.

If the Company is unable to acquire land and associated surface rights to its crude oil and natural gas

reserves, it may be unable to explore its reserves which could materially and adversely affect the

Company’s business, financial condition and results of operations.

The Company is required to acquire the land and associated surface rights overlying its crude oil and

natural gas reserves prior to commencing exploration activities on such land. The Company may face

difficulties in the acquisition of land in a timely manner, particularly in respect of land owned by private parties

and forest land, resulting in delays in some of its projects. The Company has in the past experienced significant

delays in obtaining relevant statutory and regulatory approvals for the acquisition of land and surface rights to

commence exploration activities on some of its projects, including delays related to negotiation of rehabilitation

packages for existing owners and displaced communities and the implementation of the rehabilitation and

resettlement process. The Company cannot assure you that it will not face such delays in the future. Any

inability to acquire land and associated surface rights to access the Company’s existing or future crude oil and

natural gas reserves in a timely manner on commercially acceptable terms, or at all, could have a material and

adverse effect on the Company’s business, financial condition and results of operations.

The Company is dependent on obtaining and maintaining rights to explore for and develop petroleum

properties and any inability to obtain and maintain such rights could adversely affect its business,

financial condition and results of operations. In addition, the Company’s PELs in its nomination blocks

may not be renewed by the Indian Government, which will likely result in a reduction in the Company’s

exploration activities in such areas.

Under the NELP regime, the Company is generally required to enter into a production sharing contract

(“PSC”) and obtain various licences following the award of a block pursuant to a competitive bidding process

before it can commence exploration activities. The Company’s licences and leases are issued for terms of

varying length both for its nomination and NELP blocks. Upon the expiry of the term of each of them, if the

licence or lease has not been renewed, extended or replaced, the exploration and/or production activity will

have to cease.

As of 31 March 2019, the Company held exploration licences for nine nomination blocks (five onshore

and four offshore) and 19 NELP blocks (nine onshore and 10 offshore) excluding six NELP blocks wholly

converted to PMLs. Of the 10 offshore blocks for which the Company holds exploration licences, one block is

located in deep-water/ultra-deep water and nine blocks are located in shallow water areas. In addition, as of 31

March 2019, the Company held one pre-NELP block in the exploration phase. As of 31 March 2019, the

Company had a total of 345 petroleum mining leases (“PMLs”) in nomination domestic fields and nine mining

A39729228 28

leases of NELP regime. In addition, applications have been submitted for the grant of 53 nomination PMLs for

a total area of 20,173.90 sq. km. which are under consideration of the Indian Government as of the date of this

Offering Circular. The nomination petroleum exploration licences (“PELs”) are in the final stage of their re-

grant cycle period and may not be renewed by the Indian Government beyond the life cycle period. Most of the

Company’s PELs in its nomination blocks will expire soon and are therefore likely to reduce over the next few

years, if not converted to mining leases. The Company has already converted most of its major PEL areas in

the Western Offshore Unit, Krishna Godavari, Cauvery, and Assam and Assam Arakan basins to mining leases.

If the Company is unsuccessful in obtaining mining leases, the Company will experience a reduction in the area

available for its exploration activities in India.

The Company may not be successful in achieving commercially viable production of coal-bed methane

(“CBM”) in some of its CBM blocks which may have an adverse impact on its business and results of

operations.

The Company is involved in various non-conventional energy projects, including the development of

CBM. The Company is presently operating in the states of West Bengal and Jharkhand in Eastern India for its

CBM development activities. As of 31 March 2019, the Company has established reserve blocks in Raniganj,

Jharia, Bokaro and North Karanpura. Sale of incidentally produced CBM gas was initiated in the Parbatpur

Sector of Jharia CBM block and has been continuing since January 2010.

The CBM block in Bokaro is being developed with a planned investment by the Company of Rs.

1,137.79 crore. As of the date of this Offering Circular, a total of 29 wells have been drilled with plans for

another 112 wells to be drilled and the project to be completed by 2021-2022. In addition, the Company has

also completed its construction of one early production system (“EPS”) with construction of two more EPS and

one gas collection station (“GCS”) underway with construction expected to be complete before 31 October

2019. The CBM block in North Karanpura is being developed with a planned investment by the Company of

Rs. 425.68 crore under joint operatorship by the Company with Prabha Energy Private Limited along with

Indian Oil Corporation Limited (“IOCL”) as a participating interest holder. As of the date of this Offering

Circular, a total of 23 wells have been drilled with plans for another 45 wells to be drilled and the project to be

completed by 2020-2021. The evacuation facilities at the site have also completed construction for early

production. In addition, the Company is still in the process of tendering for the construction of three GCS.

The Company has limited experience in producing CBM and, accordingly, there can be no assurances

that it will be able to achieve commercially viable production of CBM at its remaining blocks or at any blocks

that it may acquire in the future, which may have an adverse effect on its business, financial condition and

results of operations.

Various statutory and regulatory approvals that are material to the conduct of the Company’s business

and operations have not been received or are pending with various regulatory authorities and the failure

to obtain them in a timely manner or at all may adversely affect its operations.

The Company is engaged in the exploration and production of oil and gas in India and abroad. In this

regard, as of 31 March 2019, the Company operated 345 nomination PML and nine NELP regime PML, crude

oil and natural gas reserves bearing fields in India. As of 31 March 2019, the Company operated in India with

31 PELs covering an area of 61,714.1 sq.km., in India including nine nomination exploratory blocks covering

36,833.1 sq. km., out of which hydrocarbon discovery has been made in one block in KG offshore deep water,

one Pre-NELP covering 892 sq. km. under exploration phase, 19 NELP exploration acreages covering an area

of 22,533 sq. km. (excluding six blocks wholly converted into PMLs) out of which hydrocarbon discoveries

have been made in 17 operating NELP blocks, and two OALP acreages covering 1,456 sq. km. The Company

also undertakes exploration and production of oil and gas internationally through its subsidiary ONGC Videsh

Ltd. The Company’s refining operations in India are conducted through its subsidiaries, MRPL and HPCL.

A39729228 29

The Company has obtained a list of approvals and licences, under Indian law, which the Company

believes are key approvals including, but not limited to (i) the ownership of oil and gas mining/exploration

rights and for undertaking mining/exploration activities in relation to the material fields in India, and (ii) the

conduct of refining operations of MRPL and HPCL in India (the “Key Approvals”).

The Company has applied for, or is in the process of applying for, such Key Approvals. The Company

may not receive such Key Approvals within the time frames anticipated by it or at all. If it fails to obtain, or

experiences material delays in obtaining or renewing, Key Approvals, the Company’s operations could be

substantially disrupted, which could have a material adverse effect on its business prospects, financial condition

and results of operations. For further information, see “Relationship with the Indian Government and Certain

Related Party Transactions”.

The Company is involved in legal, regulatory and arbitration proceedings that, if determined against it,

may have an adverse impact on its business and financial condition.

There are certain outstanding legal proceedings against the Company pending at various levels of

adjudication before various courts, tribunals, authorities and appellate bodies in India. As of 31 March 2019,

the total amount of claims (including demands and claims by tax authorities and private parties and legal and

arbitration proceedings) against the Company on a consolidated basis which were not provided for and

considered by the Company as contingent liabilities was Rs. 694,791.71 million. Save for the RJ-ON-90/1

Block Arbitration (as described further in the section entitled “Business — Legal and Regulatory Proceedings”),

the Company does not anticipate that such other cases (individually or in the aggregate) would have a material

adverse impact on its business, financial condition or results of operations. Notwithstanding, should any new

development arise such as a change in applicable laws or rulings against the Company by the appellate courts

or tribunals, the Company may need to make provisions in its financial statements, which may increase the

Company’s expenses and current liabilities. The Company also receives requests for information under the

Right to Information Act, 2005 from various third parties from time to time. In addition, the Company may in

the future be subject to risks of future litigation, including public interest litigation, in relation to the

environmental impact of its projects or the construction activities of its projects. The Company is not able to

provide assurance that such legal proceedings will be decided in its favour. Any adverse decision may have a

significant effect on the Company’s business, including its financial condition, the implementation of its current

or future projects and its results of operations. See also the section entitled “Business — Legal and Regulatory

Proceedings”.

The Company is required to bear the entire royalty and/or OID cess burden in relation to certain blocks

in which it is a licensee or holds a participating interest.

In respect of seven pre-NELP blocks located in the Cambay, Rajasthan and Cauvery basin that are under

production or exploration or in which a commercial discovery of hydrocarbons has been made, the Company

is required, under the terms of the applicable PSCs, to bear 100.00 per cent. of the royalty burden (in respect of

production from all these blocks) and the oil industry development cess (“OID cess”) (in respect of production

in some of these blocks) notwithstanding its participating interest is only between 30.00 per cent. and 50.00 per

cent.

Royalty expenses for crude oil and natural gas produced from its pre-NELP exploratory blocks in the

2017 Fiscal Year, the 2018 Fiscal Year and the 2019 Fiscal Year were Rs. 24,842 million, Rs. 27,543 million

and Rs. 41,017 million, respectively on a non-consolidated basis. The Company acquired a 30.00 per cent.

participating interest in RJ-ON-90/1 in accordance with the terms of the applicable PSC signed in 1995.

However, from RJ-ON-90/1 which is a major oil producing block, presently contributing more than 84.41 per

cent. of the total of these seven blocks, the Company is able to recover the royalty that it pays against contract

A39729228 30

costs by obtaining equivalent crude oil. The OID cess under the RJ-ON-90/1 block is being paid by respective

partners as per participating interests, which the Company is also able to recover against contract costs.

The Company is effectively prohibited from exporting crude oil under its PSCs and revenue sharing

contracts, which could restrict its ability to monetise applicable reserves.

The PSCs signed by the Company under NELP as well as the revenue sharing contracts (“RSCs”) under

HELP effectively bar it from exporting crude oil, since, under the terms of the PSCs and the RSCs, it is under

an obligation to sell all of its entitlement to crude oil in the domestic market until such time as the total

availability of the crude oil and Condensate from all domestic petroleum production activities meets the total

national demand. There is currently a mismatch between the demand and the supply for crude oil in India, with

the demand outweighing the domestic production of crude oil, and this mismatch is expected to continue in the

long term. However, to the extent that the Company’s NELP blocks yield crude oil that is not suitable for

processing by refineries in India, it may be difficult to monetise such domestic crude oil reserves.

The failure to complete the Company’s minimum work programme could make it liable for penalties,

and the Indian Government may call upon the relevant bank guarantees it has provided to secure its

obligations.

The PSCs for all NELP blocks and RSCs for HELP blocks include a contractual obligation to complete

certain minimum work commitments in connection with the acquisition, processing and interpretation of two-

dimensional (“2D”) and three-dimensional (“3D”) Seismic Data, and the drilling of Exploratory Wells. If the

Company or its partners do not meet the minimum work programme obligations under its PSCs and RSCs, it

or its partners (as the case may be) may be liable to pay penalties. In addition, in some of the PSCs and RSCs,

the parties to such contracts are required to furnish bank guarantees equivalent to the assessed amount for the

minimum work programme commitments in proportion to their participating interest in the PSC or RSC, as the

case may be. The Company’s minimum work programme commitments for its NELP blocks are the most

significant constituent of its future commitments, and as of 31 March 2019, aggregated Rs. 3,960.17 million in

capital commitments not provided for. In the event that the Company fails to achieve its minimum work

programme commitments stipulated in a PSC or RSC, it could be liable to pay various penalties. Furthermore,

the Indian Government can enforce bank guarantees to the extent of the incomplete portion of the Company’s

minimum work programme commitment, which could have a material adverse impact on its business, financial


The Company is required to seek the approval of the Indian Government for certain decisions under its

PSCs and RSCs, which may limit its ability to take certain actions under those contracts.

The PSCs and RSCs that the Company has entered into with the Indian Government and the other parties

are in a standard format and confer certain rights on the Indian Government and require it to seek the approval

of the Indian Government in certain circumstances. For example:

the Indian Government must approve any development plan, abandonment or site restoration plans and

review any appraisal plan for discovery, and a minimum work programme with respect to each

exploration phase;

the Indian Government has the right to access the exploration acreage and to inspect and test the

appliances used for measuring the volume and quality of petroleum, and may require the other parties to

such PSCs to take remedial steps if it believes that the exploration activities are causing harm and

damage to the environment;

the operator of the exploration area cannot be changed without prior approval from the Indian

Government; and

A39729228 31

in each exploration area, the Indian Government nominates two members of the management committee,

which has a mandate to approve, inter alia, the annual work programmes in the development area,

proposals for approval of development plans, appointments of auditors and proposals for abandonment

plans and site restorations.

Accordingly, governmental decisions have the potential to limit the Company’s ability to take certain

actions under those contracts or to cause a delay in the Company taking such actions, which could have a

material adverse effect on its business, financial condition and results of operations.

Natural gas prices are controlled by the Indian Government, which limits the profitability of the

Company’s gas production business.

Natural gas prices in India are generally set by the Indian Government through a variety of mechanisms.

For natural gas produced from the Company’s nomination blocks, the prices are fixed by the Indian Government

from time to time.

Pursuant to the recommendations made by the committee headed by Dr. Rangarajan, Chairman,

Economic Advisory Council to the Prime Minister in its report on “the Production Sharing Contract Mechanism

in Petroleum Industry” in December 2012, the Indian Government approved The Domestic Natural Gas Pricing

Guidelines, 2014 effective from 1 April 2014. On 25 October 2014, the Indian Government announced the

“New Domestic Natural Gas Pricing Guidelines 2014” which superseded the Domestic Natural Gas Pricing

Guidelines, 2014 and was effective from 1 November 2014 (“2014 Gas Pricing Guidelines”). The 2014 Gas

Pricing Guidelines are applicable to all natural gas produced domestically, irrespective of the source. The 2014

Gas Pricing Guidelines are not applicable: (a) where prices were fixed contractually for a certain period of time,

till the end of such period; or (b) where the production sharing contract provides a specific formula for natural

gas price indexation/fixation. Furthermore, the pricing of natural gas from small/isolated fields in the

nomination blocks of national oil companies will be governed by the extant policy in respect of these blocks.

The domestic gas price is determined based on a weighted average formula including the: (i) annual average

prices prevailing at Henry Hub, Alberta Hub, National Balancing Point and Russia; and (ii) annual volume of

natural gas consumed in the U.S., Mexico, Canada, the E.U. and former Soviet Union countries excluding

Russia, and Russia. Domestic gas price is determined in advance on a bi-annual basis, using trailing data of

price formula for four quarter data with a lag of one quarter. The 2014 Gas Pricing guidelines are applicable to

all gas produced from nomination fields, NELP blocks and Pre-NELP blocks in which the PSC provides for the

Indian Government approval of gas prices. For customers in North-East India, the net consumer price is fixed

at 60.00 per cent. of the above price as provided under an MoPNG order providing for a subsidy to customers

in North-East India. Domestic natural gas prices notified by the Indian Government are as follows:

Period

Domestic

Natural Gas

price GCV basis

(U.S.$/MMbut)

1 November 2014 to 31 March 2015 ................................................................................................................. 5.05

1 April 2015 to 30 September 2015 ................................................................................................................... 4.66

1 October 15 to 31 March 2016 ......................................................................................................................... 3.82

1 April 2016 to 30 September 2016 .................................................................................................................. 3.06

1 October 2016 to 31 March 2017 .................................................................................................................... 2.50


1 October 2017 to 31 March 2018 ..................................................................................................................... 2.89

A39729228 32

Period

Domestic

Natural Gas

price GCV basis

(U.S.$/MMbut)


1 October 2018 to 31 March 2019 ..................................................................................................................... 3.36


For natural gas produced from blocks acquired under the pre-NELP regime, the price is fixed on a

case-by-case basis, or, in certain instances, pursuant to the terms of the relevant contractual arrangements. As

of 31 March 2019, the price of natural gas from pre-NELP blocks is within the range of U.S.$4.20 per MMbtu

and U.S.$8.50 per MMbtu.

On 21 March 2016, the MoPNG announced its guidelines on marketing including pricing freedom

(subject to a ceiling price on the basis of landed price of alternative fuels) for the gas to be produced from

discoveries made in deep-water, ultra deep-water, and high pressure and/or high temperature areas. The

guidelines are applicable to future discoveries as well as existing discoveries which commenced commercial

production after 1 January 2016 where the producers are allowed marketing freedom including pricing freedom

subject to a ceiling price on the basis of landed price of the alternative fuels. All gas fields under production at

the time of announcement continued to be governed by the pricing regime which was applicable to them. The

historical ceiling prices of natural gas notified by the Indian Government are as follows:

Period

Gross calorific

value basis

(U.S.$/MMbut)


1 October 2016 to 31 March 2017 ..................................................................................................................... 5.30


1 October 2017 to 31 March 2018 ..................................................................................................................... 6.30


1 October 2018 to 31 March 2019 ..................................................................................................................... 7.67


On 11 April 2017, the MoPNG, through the Indian Government gazette notification, introduced “The

Policy Framework for Early Monetization of Coal Bed Methane” promoting marketing and pricing freedom to

the contractors of the CBM blocks. Under this new policy, contractors have the responsibility of identifying the

market price based on arm’s length sales and to ensure transparency for any sales of any CBM with the objective

that best possible price is achieved without any restrictive or anti-competitive commercial practices.

Accordingly, the 2014 Gas Pricing Guidelines do not apply to CBM gas. However, the royalty and other dues

payable to the Government shall be payable on the higher of the market determined price or the Petroleum

Planning and Analysis Cell (“PPAC”) notified prices under the 2014 Gas Pricing Guidelines.

There can be no assurances that the operation of the price caps or the Government budgetary allocation

will not be changed in a way that will adversely affect its gas monetisation strategy or otherwise have a material

negative impact on its business, financial condition and results of operations.

A39729228 33

The Company’s refinery operations are affected by the volatility in the prices and availability of supply

of crude oil and other feedstock.

The Company’s refinery operations largely depend on the supply of crude oil, one of its principal raw

materials. In the 2017 Fiscal Year, the 2018 Fiscal Year and the 2019 Fiscal Year, the Company’s purchase of

imported crude oil amounted to Rs. 617,249.30 million, Rs. 697,188.80 million and Rs. 986,469.20 million,

respectively. The Company is capable of processing a wide range of crude oil, including crude oil from the

Middle East, South America, the Far East, West Africa and India, although its choice of feedstock at any time

depends on relative prices and yields. The Company acquires substantial portions of its requirements of crude

oil from foreign sources through a combination of term purchase contracts and spot market purchases. The

Company typically stocks approximately 10 to 15 days (in the case of MRPL) and 24 days (in the case of

HPCL) of crude oil in its storage tanks. In recent years, it has sourced a substantial part of its crude oil

requirement from the Middle East region, particularly from Iran and Saudi Arabia, and regions which have

potentially high security risks. For example, in the case of MRPL, for the 2017 Fiscal Year, the 2018 Fiscal Year

and the 2019 Fiscal Year, approximately 33.34 per cent., 28.94 per cent. and 33.59 per cent., respectively of its

throughput for the Mangalore Refinery (measured by quantity of supply) was sourced from Iran. In the case of

HPCL, generally Iranian crude is not wide prevalent in its basket of crude as compared with MRPL where its

percentage share of Iranian crude in its total throughput was approximately 8.00 per cent. in 2017 Fiscal Year

and under 5.00 per cent. for the 2018 Fiscal Year and the 2019 Fiscal Year. Events such as hostilities, strikes,

natural disasters, political developments in petroleum-producing regions (particularly in or affecting the Middle

East) or domestic and foreign government regulations could interrupt the Company’s operations and the supply

of crude oil and force it to incur significant additional costs. An interruption in the supply of crude oil or its

operations or its incurrence of significant additional costs as a result of any of these events could have a material

adverse effect on the Company’s business, financial condition and results of operations. In addition, these events

or other events, such as changes in the fiscal and regulatory environment in India, may adversely affect prices

of crude oil generally or the price at which the Company is able to obtain a supply of crude oil, which may,

under some circumstances, adversely affect its gross refining margin. The price of crude oil has been, and is

expected to continue to be, volatile. A significant increase in the price of crude oil would have an adverse effect

on the Company’s business, financial condition and results of operations if it was unable to pass on any such

higher costs to its customers.

Any significant interruption in the Company’s refinery operations may reduce the Company’s

production volumes and have an adverse effect on the Company’s business, results of operations and

financial conditions.

The Company’s refinery operations are currently located across India including (a) its 15.00 MMTPA

refinery located on the coast of the Arabian Sea at Mangalore, Karnataka through the Company’s subsidiary,

MRPL and (b) its 7.5 MMTPA refinery located in Mumbai and its 8.33 MMTPA refinery located in

Visakhapatnam through the Company’s subsidiary, HPCL. The Company’s refinery operations are subject to

numerous risks, including, but not limited to:

failure to obtain and maintain necessary governmental and other approvals;

any changes to the policies or legislation under which the relevant RoUs (i.e. right of use) have been

granted by the Indian Government;

mobilising required resources, including recruiting, housing, training and retaining a large workforce;

theft and pilferage and any related interruptions caused by such actions in relation to the relevant

pipelines;

A39729228 34

leakages and any related interruptions necessary to remedy such actions in relation to the relevant

pipelines;

breakdown, failure or substandard performance of equipment or other processes;

accidents, including fires, explosions, ruptures in, or spills from, crude and product carries or storage

tanks;

construction and development delays or defects; and

war, terrorism or civil unrest.

Any of the factors described above may disrupt the Company’s operations and may result in

environmental pollution, personal injury or wrongful death claims and other damage to the Company’s

properties and the properties of others. In the event of mechanical failure and equipment shutdowns, undamaged

sections or units of the Company’s refineries and its ancillary facilities that depend on, or interact with, damaged

sections or units may also be required to shut down. In addition to planned shutdowns for maintenance, it is

possible that one or more of units of any of the Company’s refineries and its ancillary facilities may require

unscheduled downtime for unanticipated maintenance or repairs, or the Company’s planned turnarounds may

last longer than anticipated. Such scheduled and unscheduled maintenance closures may reduce the Company’s

revenues and increase its costs during the period that certain units of the affected refinery and its ancillary

facilities are not operating, which may have an adverse effect on the Company’s business, results of operations,

financial condition and prospects. In addition, as water is a vital component for the refinery operations of the

Company, the disruption of water supply (for example, during the summer months of a year) could have an

adverse effect on the Company’s refinery business. While the Company is in the process of setting up a

desalination plant which is expected to be completed by August 2020 to improve water availability in the event

of a supply disruption, there can be no assurance that the desalination plant would be able to provide sufficient

water supply in the event of an incidence of severe water shortage which in turn could have an adverse effect

on the Company’s refinery operations, financial condition and prospects.

The Company’s exploration, development and production operations are subject to various operational,

health, safety and environmental risks and natural disasters, and resulting losses may cause material

liabilities that are not covered by insurance.

The nature of the Company’s operations exposes it to a wide range of significant health, safety, security

and environmental risks. The scope of these risks is influenced by the location, operational diversity and

technical complexity of the Company’s activities.

There are risks of technical integrity failure as well as risks of natural disasters and other adverse

conditions in many of the areas in which the Company operates which could lead to loss of containment of

hydrocarbons and other hazardous material, as well as the risk of fires, explosions or other incidents. The leaks

of crude oil that it experienced in the Mumbai High field in January 2011 are an example of the operational

risks that the Company faces in its activities. In addition, the Company has experienced a gas leak due to an

uncontrolled well activity from a natural gas well at the Konaban field located in Tripura in June 2011. The

Company experienced a gas leak in one of its wells in the KG Basin in October 2012, and in the Olpad area in

Ankleshwar Asset in April 2015. The Company experienced further gas leaks in Hazira in April 2015, Karaikal

in May and September 2015, Ankleshwar in April 2015 and June 2016, Rajahmundry in September 2016,

Ahmedabad in December 2016 and February 2017, Neelam field in January 2018 and the Mumbai High field

in December 2015 and July 2018. Although the gas leaks have been capped, such incidents are inherent in the

nature of the Company’s business and may have an adverse impact on its financial condition and results of

operations. All modes of transportation of hydrocarbons involve inherent risks. An explosion or fire or loss of

containment of hydrocarbons or other hazardous material could occur during transportation by road, rail, sea or

A39729228 35

pipeline. This is a significant risk due to the potential impact of a release on the environment and people and

given the high volumes involved. In addition, the Company’s inability to provide safe environments for its

workforce and the public could lead to injuries or loss of life and could result in regulatory action, legal liability

and damage to its reputation.

The Company’s operations are often conducted in difficult or environmentally sensitive locations in

which the consequences of a spill, explosion, fire or other incident could be greater than in other locations.

These operations are subject to various environmental laws, regulations and permits and the consequences of

failure to comply with these requirements can include remediation obligations, penalties, loss of operating

permits and other sanctions. Accordingly, inherent in its operations is the risk that if the Company fails to abide

by environmental and safety and protection standards, such failure could lead to damage to the environment

and could result in regulatory action, legal liability, material costs and damage to its reputation or loss of its

licence to operate.

Crisis management plans and capability are essential to deal with emergencies at every level of the

Company’s operations. If the Company does not respond, or is perceived not to respond, in an appropriate

manner to either an external or an internal crisis, its business and operations could be severely disrupted.

Exploration for and production of crude oil and natural gas is hazardous, and man-made and natural

disasters, operator error or other accidents can result in oil spills, blowouts, cratering, fires, equipment failure,

and loss of well control, which can injure or kill people, damage or destroy wells and production facilities, and

damage property and the environment. Offshore operations are subject to marine perils, including severe storms

and other adverse weather conditions, vessel collisions, and governmental regulations as well as interruptions

or termination by governmental authorities based on environmental and other governmental considerations.

Also, the Company runs the risk that it may not find any economically productive natural gas or crude oil

reservoirs. In addition, the costs of drilling, completing and operating wells could be subject to shortages of, or

delays in obtaining, equipment, and the inadequacy or unavailability of, or other problems with, transportation

facilities. Breakdowns in the Company’s equipment or that of contractors, or in the infrastructure on which it

relies, could disrupt its operations and adversely affect its business. In particular, its computers,

telecommunications and electronic systems and equipment are vulnerable to breakdowns, disruptions or other

problems that may adversely affect its operations. The Company maintains insurance coverage against some,

but not all, potential losses. Although the Company attempts to limit and mitigate its liability for damages

arising from negligent acts, errors or omissions through insurance policies, the limitations of liability set forth

in its insurance policies may not be enforceable in all instances or may not protect it from liability for damages.

These may lead to financial liability and other adverse consequences for the Company. Further, even where the

Company has insurance coverage in place, it may not be able to assert successfully its claims for any liability

or loss under such insurance policies. This may have a material adverse effect on the Company’s business,

financial condition and results of operations. For example, the Company has no insurance coverage for loss of

profits or earnings, damaged or destroyed data or records. Losses and liabilities arising from such events may

significantly reduce the Company’s revenues or increase its costs (for example, by incurring extra costs on site

restoration, disaster recovery and workers’ compensation or rehabilitation) and have a material adverse effect

on its financial condition and results of operations.

The Company may incur material costs to comply with, or suffer material liabilities as a result of,

health, safety and environmental laws and regulations.

The Company’s operations are subject to extensive laws and regulations pertaining to pollution and

protection of the environment and health and safety of workers. These laws and regulations govern, among

other things, emissions to the air, discharges onto land and into water, maintenance of safe conditions in the

workplace, the remediation of contaminated sites, and the generation, handling, storage, transportation,

treatment and disposal of waste materials. The Company incurs, and expects to continue to incur, significant

A39729228 36

capital and operating costs to comply with these requirements, including costs to reduce air emissions and

discharges to the natural water bodies and to remedy contamination at various facilities where the Company’s

products or wastes have been handled or disposed. It also could incur significant costs, including clean-up costs,

fines and civil and criminal sanctions, if it fails to comply with these laws and regulations or the terms of its

permits. In addition, future changes to environmental laws and regulations, such as changes in laws and

regulations relating to climate change, could result in substantial additional capital expenditure, taxes and

reduced profitability from increased operating costs or in restrictions on its revenue generation, operations or

strategic growth opportunities.

The Company may incur environmental liabilities in respect of its operations even for environmental

damage caused by acts or omissions of its contractors. Under the production-sharing arrangements entered into

by the Company with various parties, it is required to indemnify the contractors, as well as the Indian

Government and the relevant state government, for environmental damage and related losses caused by its

exploration and production operations to the extent of its participating interest in such ventures, subject to

limited exceptions. Also, some of its service contracts limit the contractors’ liability for pollution caused by

their activities. For instance, in some contracts, the Company is obliged to indemnify the contractor for surface

damage arising out of sub-surface damage caused by the personnel or equipment of the contractor irrespective

of the cause of the damage, subject to limited exceptions. The Company’s insurance coverage does not cover

all potential liabilities that may arise as a result of environmental damage caused by contractors, its joint venture

partners or by the Company itself and this may result in a material adverse impact on the Company’s results of

operations. Similarly, its Russian subsidiaries do not have any insurance for environmental damage caused by

their activities. Furthermore, with new regulations for the reduction of gas flaring having gone into effect, the

Company’s costs and penalties payable in compensation for environmental damage for gas emission in excess

of permitted levels have increased.

The Company has taken public liability insurance for all of its installations and operations in India in

compliance with the Public Liability Insurance Act, 1991, as amended from time to time (the “Public Liability

Insurance Act”). The Company maintains other insurances from time to time in accordance with its ordinary

business. However, no assurance can be given that the insurance policies may cover the specific type of

liabilities or there may be exclusions in relation to insurances policies, in addition the amount of damages or

penalties may exceed the amount paid out under an insurance policy. Consequently, this may adversely affect

the Company’s business, financial condition, profitability or results of operations.

The Company has significant contingent liabilities that it has not provided for in its balance sheet.

As of 31 March 2019, the Group’s consolidated contingent liabilities not provided for were as follows:

Contingent Liabilities

As of 31 March

2019

(Rs. millions)

Claims against the Group/disputed demands not acknowledged as debt(1)

(a) Tax Liability:-

(i) In respect of the Company (consolidated) ..................................................................................................... (305,912.54)

(ii) In respect of joint ventures and associates .................................................................................................. (3,559.44)

Sub Total (A) ..................................................................................................................................................... (309,471.98)

(b) Other than Tax Liability:-


(ii) In respect of joint ventures and associates .................................................................................................. (4,878.36)

Sub Total (B) ..................................................................................................................................................... (385,319.73)

A39729228 37

Contingent Liabilities

As of 31 March

2019

(Rs. millions)

Total (A + B) ..................................................................................................................................................... (694,791.71)

Capital commitments(2)

(a) Estimated amount of contracts remaining to be executed on capital account:-


(ii) In respect of the Company’s (consolidated) share in joint ventures ............................................................. (2,695.41)

Sub Total (C) ..................................................................................................................................................... (567,366.60)

(b) Unconditional purchase obligation (in respect of the Company (consolidated)) (D) ................................... (6,407.14)

(c) Non-cancellable Operating Lease commitment in respect of the Company (consolidated) (E) .................... (147,063.88)

Total (A + B + C + D + E)(3) .............................................................................................................................. (1,415,629.33)

Notes:

(1) Including amounts in respect of joint ventures and associates. For more information, see “Note 55.1 of the Notes to

the Company’s Consolidated Financial Statements for the year ended 31 March 2019”.

(2) Includes commitments in respect of Group share in joint ventures. For more information, see “Note 55.3 of the Notes

to the Company’s Consolidated Financial Statements for the year ended 31 March 2019”.

(3) Excludes “Other Commitments” as set out in “Note 55.3.2 of the Notes to the Company’s Consolidated Financial

Statements for the year ended 31 March 2019”.

The Company has also incurred other contingent liabilities not currently reflected in the table above. For

example, the Company entered into an arrangement for backstopping support towards repayment of principal

and cumulative coupon amount for three years in respect of compulsory convertible debentures amounting to

Rs. 77,780 million issued by ONGC Petro-additions Limited. For more information and such other contingent

liabilities not reflected in the table above, please see Note 55.3.2 of the Notes to the Company’s Consolidated

Financial Statements for the year ended 31 March 2019”.

Such contingent liabilities include contingent liabilities incurred by the Company in respect of joint

ventures as well. To the extent that any of these contingent liabilities become actual liabilities, they will

adversely affect the Company’s results of operations and financial condition in the future.

Much of the Company’s equipment is old and significant expenditure may be required to maintain

operability and operations integrity.

Much of the equipment which the business of the Company utilises, including drilling equipment,

production facilities and pipelines, is old and requires upgrading, revamping or replacement, particularly in its

Mumbai High field, where much of the equipment is more than 35 years old. Moreover, the Company does not

maintain insurance policies for most of its heavy machinery in India. Despite the planned significant operating

and capital expenditure, there can be no guarantee that the equipment will not suffer material damage through

wear and tear, natural disasters or industrial accidents, or will not require further significant capital

improvements or maintenance in the future which could have a material adverse effect on the Company’s

business, financial condition and results of operations.

Additionally, the Company may fail to maintain sufficient financing and budgetary controls, planning

and monitoring systems, procurement co-ordination, scheduling for technology upgrading and maintenance and

A39729228 38

efficient use of hired services with respect to its equipment, all of which may increase the cost of its exploration

and production activity which could have an adverse effect on its profitability.

The Company may not be able to upgrade its existing technologies and to assimilate and acquire new,

more advanced technologies in a timely and cost-effective manner.

In order to optimise production from its reserves, carry out exploration in deep-water areas, exploit non-

producing basins and acquire knowledge and expertise about frontier basins, it is necessary that the Company

adopts advanced technology rapidly and cost-effectively, and trains its personnel in the operation and

maintenance of such technology. If it is unable to acquire such technology in a timely manner or fails to

appropriately revamp existing technology, it may not be able to fully exploit its reserves.

As acquisition of technology is highly capital intensive, if such technology is not utilised in a productive

and efficient manner, the Company may not realise the benefits it expects from such technology and its

operations and profitability may be adversely affected. There can be no assurances that it will be able to

successfully implement the technology on which its strategy is dependent and its failure to do so could have a

material adverse effect on its business, financial condition and results of operations. In addition, if it is unable

to acquire new technology it may have to incur even greater expense to lease such technology than it would

have incurred to acquire it.

The Company may not be able to successfully limit its gas flare in connection with its natural gas

production.

As part of its strategy, the Company intends to focus on the commercialisation of its natural gas reserves

and to improve its utilisation of natural gas. The Company’s ability to do so successfully is in part dependent

upon its ability to limit its gas flaring. In particular, the Company may be required to flare gas in the event that

it is unable to establish surface production facilities by the time it first begins production within any given field.

As development drilling is undertaken in a field, the Company begins to install surface facilities to handle the

field’s production. However, there is often a time lag between the start of production and surface facilities being

ready for production. If the field is producing associated gas before surface facilities are available to handle

production, the Company is required to flare such gas, which results in a reduction in the amount of gas realised

from its producing fields. The Company’s inability to successfully limit gas flaring could have an adverse effect

on its ability to successfully implement its gas monetisation strategy. Additionally, regulations governing gas

flaring are less restrictive in India than in many other parts of the world. For example, Russia levies emission

payment charges for gas flaring and ONGC Videsh had paid emission charges for gas flaring in its fields in

Russia. If India were to adopt more restrictive gas flaring regulations, there can be no assurance that the

Company would be able to comply with such regulations, or to do so without incurring significant cost, thereby

adversely affecting its profitability.

The loss of the services of skilled employees and of its key management personnel could adversely affect

its business.

The Company’s business is dependent on it maintaining a skilled workforce. Several members of the

Company’s senior management team have been with the Company for several years and have extensive

knowledge of the Company’s operations. If the Company loses the services of key management personnel, it

may be difficult to find, relocate and integrate replacement personnel in a timely manner, which could seriously

affect its operations and the growth of its business. In particular, the Company depends on specific key talent

such as geologists and upstream energy specialists. The Company faces specific disadvantages in its efforts to

attract and retain its management personnel. As a PSU, the Indian Government policies regulate and control the

emoluments, benefits and perquisites that the Company pays to its employees, including its key managerial and

technical personnel and these policies may not permit the Company to pay market rates. Consequently, private

sector market participants that are able to pay at market rates in exploration and production activities in the

A39729228 39

crude oil and natural gas industry have been attracting qualified personnel and reducing the talent pool available

to PSUs. The Indian Government could also promote or transfer some of the Company’s key members from

the senior management team to take up positions either within or outside the Company. Additionally, the

Company may not have in place the necessary systems and processes to develop key personnel internally, which

may limit its ability to retain such personnel. The Company’s failure to have or retain quality personnel in key

positions and functions could have a material adverse effect on its business, financial condition and results of

operations.

Domestic producers of crude oil and natural gas in India may face increased competition from

importers and alternative sources of energy.

Historically, domestic crude oil and natural gas producers in India have benefited from import tariffs

payable on crude oil and natural gas imported into India. However, the tariff system is subject to fluctuations.

Import tariffs were removed in June 2011. In July 2019, the Indian Government announced in the financial

budget for the fiscal year 2019 to 2020 to re-impose a nominal duty of Rs. 1 per tonne on crude oil imports.

Any increase or decrease in the rates at which such tariffs are levied may lead to increased competition from

importers of crude, particularly as the gap between supply and demand for crude oil in India begins to lessen.

In addition, there is a relative lack of infrastructure for importing and distributing liquefied natural gas,

which has limited the quantities of liquefied natural gas imported into India, resulting in reduced competition

for domestic natural gas producers. However, the development of the liquefied natural gas market and related

infrastructure, such as import terminals, could lead to increases in natural gas imports and increased competition

for the development and production of domestic natural gas.

Furthermore, in the long term, commercially viable production of proposed substitutes for crude oil and

natural gas such as renewables, fuel cells or bio-fuels may be available at cheaper prices than crude oil and

natural gas, thereby reducing the demand for crude oil and natural gas and having a material adverse effect on

the Company’s results.

The Company relies on third party contractors or agencies and are therefore exposed to execution risks,

including in relation to the timing or quality of their services, equipment or supplies.

The Company relies on the availability of skilled and experienced contractors and specialist agencies for

the implementation and operation of various aspects of its business. The Company does not have direct control

over the timing or quality of the services and supplies provided by such third parties. Third party contractors

expose the Company to various risks, including credit risk, settlement risk, operational risk, legal risk and

reputation risk. The execution risks that the Company faces include the following:

contractors hired by the Company may not be able to deliver contracted products or services within

budgeted costs and timelines or to the agreed specifications and standards;

as the Company expands in the future, it may be exposed to delays in meeting project milestones, which

may increase its financing costs and reduce its anticipated return on capital; and

the Company’s contractors may engage contract labour to complete specified assignments, and although

the Company does not engage such laborers directly, the Company may be held responsible under

applicable Indian laws for wage payments to such labourers should its contractors default on wage

payments.

While the Company regularly monitors the implementation of various aspects of its business that have

been contracted to such third parties and manages its risk through performance guarantees, contractual

indemnities, disclosure and confidentiality obligations and limitations of liability, it may not be possible for the

Company to protect itself from all possible risks arising from third party default, or to enforce such contractual

A39729228 40

protection and recover the full amount of any losses that the Company may suffer as a result of any delay or

shortfall in performance. In the event of a material failure or disruption in committed services or supplies, the

Company cannot provide any assurances that it will be able to make alternative arrangements in reasonable

time, on commercially acceptable terms, or at all. As a result, the Company’s business, results of operations,

financial condition and prospects may be adversely affected.

In addition, as a result of increased industrial development in India in recent years, the demand for

contractors and agencies with specialist design, engineering and project management skills and services has

increased, resulting in a shortage of and increasing costs of services of such contractors and agencies. The

Company cannot be certain that such skilled and experienced contractors and agencies will continue to be

available at reasonable rates in the future. Any deterioration in the Company’s relationships with its existing

contractors and agencies, or the Company’s failure to renegotiate acceptable terms may result in the Company

incurring substantial additional costs, beyond its budgeted expenditure, in identifying and entering into

alternative arrangements with other contractors and agencies. Moreover, third party defaults that disrupt or

otherwise affect the Company’s operations and that are not adequately resolved or cured in a timely manner

may render the Company liable to regulatory intervention, cause damage to the Company’s reputation, and

adversely affect its business, results of operations and financial condition.

The Company’s joint statutory auditors have relied on the unaudited financial statements of certain of

its joint ventures and subsidiaries in connection with their audit of the financial statements that form

the basis of the financial statements included in this Offering Circular.

In connection with their audit of the financial statements that form the basis for the financial statements

included in this Offering Circular, the Company’s joint statutory auditors have relied on the audit reports

prepared by other auditors relating to certain of its subsidiaries and joint ventures, including contractual joint

ventures. The audited financial statements were not available for certain of its subsidiaries (i.e. ONGC Narmada

Ltd., ONGC BTC Ltd. and Indus East Mediterranean Exploration Ltd and certain of its joint ventures (i.e. Dahej

SEZ Limited, ONGC Mittal Energy Limited and SUDD Petroleum Operating Company Ltd.) and one of its

associates (i.e. Pawan Hans Limited). Where audited financial information was not available, the Company’s

joint statutory auditors have relied on unaudited financial statements certified by management in accordance

with applicable Indian audit standards.

The Company’s failure to protect its intellectual property rights may have an impact on its business and


As of the date of this Offering Circular, the Company (a) had three registered trademarks in India which

are valid until 5 February 2025, (b) held 35 valid patents issued during 2002-2018 (each of which are valid for

20 years from the date of priority and subject to annual renew) with 75 pending filed patent applications and

(c) had 31 registered copyrights with four filed pending copyright applications. The Company operates in an

extremely competitive environment, in both its existing business and its planned ventures into the downstream

businesses of refining and retail marketing, where generating brand recognition and intellectual property rights

will be a significant element of the Company’s business strategy. If it fails to protect its intellectual property

rights, including trademarks or trade secrets, or otherwise fails to obtain registration of the patents the Company

has applied for, or may apply for in the future, its business may be adversely affected.

The Company is subject to stringent labour laws and trade union activity.

India has stringent labour laws that protect the interests of workers, including legislation that sets forth

detailed procedures for employee removal and dispute resolution and imposes financial obligations on

employers upon employee layoffs. This makes it difficult for the Company to maintain flexible human resource

policies, discharge employees or downsize, which may adversely affect its business and profitability. As of 31

March 2019, the Company’s employees are represented by 47 registered trade unions of which 12 are

A39729228 41

recognised by the Company. A majority of the trade unions (including unrecognised trade unions) are affiliated

with central trade unions. The Company entered into a long-term settlement under the provisions of the

Industrial Disputes Act, 1947 with all the recognised unions that is binding on all unionised categories of

employees, effective 1 January 2007. The wage revision for unionised category with effect from 1 January 2017

is being deliberated with the recognised unions. The Company has in the past (in 2009) suffered disruptions in

its operations due to strikes and lockouts by its employees. The Company cannot guarantee that such disruptions

will not occur in the future.

The interests of the Company’s Directors may cause conflicts of interest in the ordinary course of the

Company’s business.

Conflicts may arise in the ordinary course of decision-making by the Board. Some of the Company’s

non-executive Directors may also be on the board of directors of certain companies engaged in businesses

similar to the business of the Company. In accordance with the procedure laid down in the Companies Act 2013,

its Directors are required to disclose any conflict of interest to the Board, following which they may or may not

be allowed to participate in any discussions concerning the matters tabled before the Board. Although in the

past the Company has not had any incidence of conflict of interest, there is no assurance that its Directors will

not provide competitive services or otherwise compete in business lines in which it is already present or will

enter into in the future.

Global and domestic economic conditions may have a material adverse effect on the Company’s


Global financial markets have in the past experienced turmoil and upheaval characterised by extreme

volatility and declines in prices of securities, diminished liquidity and credit availability, inability to access

capital markets, the bankruptcy, failure, collapse, nationalisation or sale of financial institutions and an

unprecedented level of governmental intervention. The Indian economy and financial markets were also

significantly impacted by such global economic, financial and market conditions. Any financial turmoil,

especially in the United States, Europe or China, may have a negative impact on the Indian economy. Indian

financial markets also experienced the contagion effect of the volatility and turmoil in the global financial

markets. A revival of such economic conditions, either globally or domestically, could result in future decreases

in the demand for crude oil and natural gas and put downward pressure on the prices for crude oil and natural

gas which have experienced significant volatility in recent times. Additionally, due to the conditions in the

global and domestic financial markets, the Company cannot be certain that funding will be available or that it

would be able to raise funds, if needed or to the extent required, and it may be unable to implement its strategy,

including its exploration and development plans in existing acreage and its acquisition of additional acreage

domestically and internationally.

The Company is subject to risks arising from exchange rate fluctuations.

The international prices of crude oil and value-added products, which account for the substantial

majority of the Company’s sales revenues, are denominated in U.S. dollars. Most of its expenditure as well as

its accounts as a whole, are denominated in Indian Rupees. It also imports crude oil as raw material for its

refining business, and incurs such raw material costs in U.S. dollars. As a result, fluctuations in foreign exchange

rates, in particular the exchange rate of U.S. dollars for Indian Rupees, may materially affect its revenues and

results of operations. The Company does not currently hedge its foreign currency exchange rate exposure. In

respect of ONGC Videsh, ONGC Videsh’s functional currency under the applicable accounting standards is

U.S. dollars and as of the date of this Offering Circular, liabilities in respect of the bonds denominated in Indian

Rupees issued by ONGC Videsh in the Indian market, liabilities in respect of the Bonds denominated in Euro

issued in July 2014 in the international markets, and liabilities in respect of a term loan denominated in Japanese

Yen, have each been partly swapped into U.S. dollars. In respect of HPCL, HPCL is exposed to currency risk

mainly on account of its borrowings and import payables in foreign currency to which it engages in generic

A39729228 42

derivatives contracts to mitigate the risk of changes in foreign exchange rates in line with its foreign exchange

management policy and has established a foreign exchange risk management cell which actively reviews the

foreign exchange and interest rate exposures. The Company’s results of operations are also subject to

fluctuations in the currencies of the countries in which it undertakes its international exploration, development

and production activities. The Company incurs a portion of its operational expenditure in the local currencies

of these countries, particularly relating to labour, local materials and services, royalties and tax. Fluctuations in

the value of such currencies against the U.S. Dollar could impact its results of operations. For example, the

Company experienced an increase in tax liability in the 2012 Fiscal Year and in the 2016 Fiscal Year in

connection with its operations in Venezuela because the significant devaluation of the Venezuelan Bolivar

against the U.S. Dollar caused a revaluation of receivables and increased its taxable profit. Inter-company

transactions may also result in a charge of foreign exchange differences to the statement of profit and loss as in

the case of loans given by the Company’s subsidiary in the Netherlands to its step-down subsidiary in Brazil

where the step-down subsidiary accounts are denominated in currency other than U.S. Dollar. Moreover, the

reporting currency of the Company’s financial statements for certain of its Imperial Energy assets in Russia is

the Russian Ruble, and fluctuations in the exchange rate of the Russian Ruble against the Indian Rupee or the

U.S. Dollar, could affect its consolidated results of operations and financial condition.

A change in the Indian Government’s policy on tariffs, direct and indirect taxation and fiscal or other

incentives and payment for petroleum goods could adversely affect the Company’s business.

The Company’s profitability is significantly affected by the difference between import tariffs currently

imposed by the Indian Government on crude oil, which is the Company’s most significant raw material, and

tariffs currently imposed on certain refined petroleum products. Increases in import tariffs on crude oil or

decreases in import tariffs on certain refined petroleum products could have a material adverse effect on the

Company’s business, financial condition and results of operations. There can be no assurance that there will not

be a significant change in the Indian Government policy which could adversely affect the Company’s financial

condition and results of operations in this way. The Company’s profitability is also significantly dependent on

the policies of the central and state governments relating to various direct and indirect taxes (including sales tax

and income tax), duties (including excise duties and import duties) and fiscal or other incentives. Any change

in Indian Government policies relating to such taxes or duties or incentives could adversely affect the

Company’s profitability.

Furthermore, there can be no assurance that the Government will not intervene with regard to the timing

of payments by purchasers of certain petroleum products in the interest of public policy. For example, in recent

years, payments by a few domestic airline companies in respect of aviation turbine fuel (“ATF”) to their

suppliers, including the Company, were deferred. In select cases of payment deferment, the Indian Government

facilitated discussions between the concerned airline companies and the Company. While there has been an

improvement recently in the flow of funds from such airline companies, there can be no assurance that such

deferments would not occur again. Any prolonged or additional significant changes in Indian Government

policy with respect to payment for any of the Company’s products could adversely affect the Company’s


The Company may be unable to fully execute its business strategy.

The Company’s business strategy contemplates better utilisation of its resources and converting its

exploration areas into crude oil and natural gas reserves. through (a) increasing domestic exploration,

development and production efforts, (b) improving oil and gas recovery and gas utilisation levels in producing

properties, (c) augmenting international reserves and production, (d) capturing value through forward

integration, (e) continuing to maintain high environmental and safety standards and (f) continuing to focus on

non-conventional energy. For more information, see the section entitled “Business – Strategies”. These

strategies will require substantial new financing which may not be available to the Company. In addition, if the

A39729228 43

Company’s cost of capital is high, the Company may not be able to finance its planned projects necessary to

implement its business strategy. If the Company cannot raise sufficient funds on terms and at a price reasonably

acceptable to the Company, it may be unable to execute its strategy, which may have a material adverse effect

on its business, financial condition and results of operations.

The Company’s expansion plans are subject to a number of risks and uncertainties.

The Company’s expansion plans are subject to a number of factors, including changes in laws and

regulations, governmental action, delays in obtaining permits or approvals, movements of global prices of crude

oil and products, accidents, natural calamities, and other factors beyond the Company’s control. Oil and gas

projects generally have long gestation periods due to the process involved in the commissioning phase.

Construction contracts and other activities relating to the projects are awarded at different times during

the course of the projects. In addition, the Company’s projects are dependent on external contractors for

construction, installation, delivery and commissioning, as well as for supply and testing of key plants and

equipment. The Company may only have a limited control over the timing or quality of services, equipment or

supplies provided by these contractors. The Company is highly dependent on some of the external contractors

who supply specialised services and sophisticated and complex machinery. There can be no assurance that the

performance of the external contractors will meet the Company’s specifications or performance parameters or

that they will remain financially sound. The failure of the external contractors to perform or delay in

performance could result in incremental cost and time overruns, or the termination of a project. There can be

no assurance that the Company would be able to complete its expansion plans in the time expected, or at all, or

that their gestation period will not be affected by any or all of these factors.

The Company has incurred significant indebtedness and must service this debt and comply with its

covenants to avoid default risk.

The Company has incurred significant indebtedness in connection with its operations and investments.

As of 31 March 2019, the Company’s consolidated long-term borrowings was Rs. 531.44 billion (U.S.$7.68

billion) and its net debt-to-equity ratio was approximately 0.44:1. In addition, the Company may incur

additional indebtedness in the future, including indebtedness incurred to fund capital contributions to its

subsidiaries and joint ventures, subject to certain limitations imposed by the Company’s existing financing

arrangements. Although the Company believes that its current levels of cash flows from operations and working

capital borrowings are sufficient to service its existing debt, there can be no assurance that its level of cash

flows will not decrease or will remain sufficient to service its debt. The Company’s failure to comply with any

of the covenants contained in its financing arrangements could result in a default which would permit the

acceleration of the maturity of the indebtedness under such agreements and, if the Company is unable to

refinance such indebtedness in a timely fashion or on acceptable terms, would have a material adverse effect

on the Company’s business, financial condition and results of operations.

Inability to obtain adequate financing to meet the Company’s liquidity and capital resource

requirements may have an adverse effect on its results of operations.

The Company has had, and expects to continue to have, substantial liquidity and capital resource

requirements for meeting its working capital requirements as well as capital expenditures. The Company will

be required to supplement its cash flow from operations with external sources of financing to meet these

requirements. The inability of the Company to obtain such financing may impair its business, results of

operations, financial condition or prospects. There can be no assurance that financing from external sources

will be available at the time or in the amounts necessary or at competitive rates to meet the Company’s

requirements.

A39729228 44

The Company may not be able to collect all of its receivables.

The Company carries collection risk when it does not demand up-front cash payment for delivered

products. The Company must be able to collect promptly from its customers to be able to pay its obligations

and finance its operations. In particular, the Company faces such collection risk in respect of its receivables

from its overseas operations especially from those relating to Sudan and Venezuela.

In order to manage its collection risk, the Company assesses the financial health of its customers, and

whether to extend credit accordingly. In certain cases, a credit line may also be backed by a bank guarantee. To

ensure prompt payment, the Company grants a discount if the customer pays within a specified period.

Obligations not paid to the Company on the due date shall bear interest computed from the first day after it

becomes due and payable, equivalent to the prevailing interest rate or the specified rate in the agreement.

Overdue accounts are charged with interest.

The Company believes that its customers have good credit standing. In case a customer encounters

financial difficulty, however, the Company may reduce its product supply, invoke the bank guarantee, cut off

credit entirely or demand payment in advance to reduce exposure to collection risk and subsequent payment

defaults. Any failure on the part of the Company to effectively manage its collection risk could have an adverse

impact on its business, financial condition and results of operations.

Changes in accounting standards may impact the Company’s financial condition.

The Company prepares and presents its financial statements in accordance with IND-AS, and there may

be new and revised accounting standards and interpretations in the future requiring the adoption of new

accounting policies. There can be no assurance that the adoption of new accounting policies or any change or

amendment to or any interpretation of IND-AS will not have a significant impact on the Company’s financial


With effect from 1 April 2019, the Company has adopted IND-AS 116 which replaces the previous

accounting standard IND-AS 17. IND-As 116 introduces a single lessee accounting model and requires a lessee

to recognise assets and liabilities for all leases with a term of more than 12 months, unless the underlying asset

is of low value and sets out the principles for the recognition, measurement, presentation and disclosure of

leases. Please refer to (a) Note 3 of the Company’s unaudited and reviewed consolidated financial statements

for the three months ended 30 June 2019 and (b) Note 3 of the Company’s unaudited and reviewed non-

consolidated financial statements for the three months ended 30 June 2019 for a discussion on the impact on

the adoption of IND-AS 116. As the Company has applied the modified retrospective transition method set out

in IND-AS 116 which does not require any restatement of the corresponding figures of the prior period before

1 April 2019, the Company’s financial information as at and for the years ended 31 March 2018 and 31 March

2019 may not be directly comparable against the Company’s financial information after 1 April 2019, including

the unaudited and reviewed consolidated financial statements of the Company for the three months ended 30

June 2019 and the unaudited and reviewed non-consolidated financial statements of the Company for the three

months ended 30 June 2019. Investors must therefore exercise caution when making comparisons of any

financial figures after 1 April 2019 against the Company’s financial figures prior to 1 April 2019 and when

evaluating the Company’s financial condition, results of operations and results.

A39729228 45

Risks Relating to the Oil and Gas Industry

The oil and gas industry is highly regulated in India and the other countries where the Company

currently or in the future conducts exploration and production activities and adverse changes in

regulations could have a material adverse effect on its business, financial condition and results of

operations.

The Company is subject to comprehensive regulation in India and in the countries in which it conducts

its international exploration and production activities, particularly in Russia. It is likely that any countries in

which the Company operates in the future may also have comprehensive oil and gas regulations. Changes to

such regulations could require changes to the manner in which it conducts its business and result in an increase

in compliance costs which could have a material adverse effect on its business, financial condition and results

of operations.

For example, the Petroleum and Natural Gas Regulatory Board (the “PNGRB”) was established in India

in 2007 and has the authority to, among other things, regulate refining, processing, storage, transportation

(including laying of pipelines), distribution, marketing and import, export and sale of petroleum, petroleum

products and natural gas, excluding the production of crude oil and natural gas, monitoring prices and taking

corrective measures to prevent restrictive trade practices, imposing fees and other charges and regulating

technical and safety standards and specifications relating to petroleum, petroleum products and natural gas.

There can be no assurance that such rules, regulations and jurisprudence of the PNGRB will not evolve in a

manner that results in a material adverse effect on the Company’s business, financial condition and results of

operations, including through the imposition of pricing mechanisms for the sale of crude oil or natural gas.

In addition, the Indian oil and gas industry currently benefits from exemptions from custom duties,

export duties and other charges on re-exportation on machinery, plant, equipment, materials and supplies

imported solely and exclusively for use in petroleum operations. To the extent that such exemptions were to

become unavailable due to changes in tax regulation, the Company’s costs for the procurement of such items

would increase, which may result in a material adverse effect on its business, financial condition and results of

operations. For further details, see “Relationship with the Indian Government and Certain Related Party

Transactions”.

Exploration and production of crude oil in deep and ultra-deep waters involves risks.

Exploration and production of crude oil involves risks that are enhanced when carried out in deep and

ultra-deep waters. As of 31 March 2019, the Company held one deep-water NELP block and four deep-water

nomination blocks and it intends to intensify its exploration and development efforts, primarily through

expansion of its deep-water exploration activities in India. Out of the four deep-water nomination blocks, the

Company is awaiting clearance from the Ministry of Defence for three blocks and exploratory efforts will be

resumed after getting clearance. The Company’s deep-water programme involves the deployment of certain

drilling ships and includes the involvement of consultants for deep-water drilling, technology, testing,

completion and field development services. The Company’s activities, particularly deep-water and ultra-deep

water drilling, present several risks, such as the risk of spills, explosions in pipelines and drilling wells and

natural and geological disasters. The occurrence of any of these events or other accidents could result in personal

injuries, loss of life, severe environmental damage with the resulting containment, clean-up and repair expenses,

equipment damage and liability in civil and administrative proceedings.

The fire and explosion on-board the semisubmersible drilling rig Deepwater Horizon, which led to the

oil spill affecting the Gulf of Mexico in April 2010, illustrates these risks. As a result of the spill, the US

Department of Interior imposed a six-month deep-water drilling moratorium in the region, implemented

stringent new safety and environmental regulations, which deep-water drilling companies have to meet before

they may resume operations in the region, and created two new agencies devoted to overseeing offshore drilling.

A39729228 46

The new safety and environmental rules tighten standards for well design, blowout preventers, safety

certification, emergency response and worker training, among other things, which could increase the costs of

exploration and production, reduce the area of operations and result in delays in obtaining the required permits

for deep-water drilling companies operating in the region. The rules could also potentially influence regulators

in other geographic regions, including the regions in which the Company operates, to implement similar

regulatory initiatives and changes that could have an adverse effect on its business, financial condition and


The Company also believes the accident in the Gulf of Mexico may lead to higher insurance costs for

the crude oil and natural gas industry as a whole but it cannot predict the magnitude of such increase. In addition,

the Company’s insurance policies may not cover all liabilities, and insurance may not be available for all risks.

There can be no assurance that accidents will not occur in the future, that insurance will adequately cover the

entire scope or extent of its losses or that it will not be found liable in connection with claims arising from these

and other events.

Operational failures and associated reputational consequences may lead to an increasingly stringent

regulatory environment.

Operational failures of companies operating in crude oil and natural gas exploration, development and

production, together with associated reputational consequences, may lead to increasingly stringent

environmental and other regulations. Changes in foreign environmental laws and regulations, or their

interpretation, may require the Company to incur significant unforeseen expenditures to comply with such

requirements, add significantly to operating costs, or may significantly limit drilling activity.

Given the possibility of unanticipated regulatory or other developments, including more stringent

environmental laws and regulations, the amount and timing of future environmental compliance expenditures

could vary substantially from their current levels. The Company cannot predict what additional environmental

legislation or regulations will be enacted in the future or the potential effects on its financial position and results

of operations, and potentially significant expenditures could be necessary in order to comply with future

environmental laws. Also, such capital expenditures and operating expenses relating to environmental matters

will be subject to evolving regulatory requirements and will depend on the timing of the promulgation and

enforcement of specific standards that impose additional requirements on its operations. Accordingly, the

Company cannot assure you that it will not be subject to stricter enforcement or interpretation of existing

environmental laws and regulations, or that such laws and regulations will not become more stringent in the

future.

Cyclical downturns in the refining and petrochemical industry may adversely affect the Company’s

margins and operating results.

A significant portion of the Company’s consolidated revenue is attributable to sales of various refined

and petroleum products in India. In the 2019 Fiscal Year, the consolidated sales of refined and petroleum

products were Rs. 3,625,333.33 million (gross of excise duty) while the Company’s non-consolidated sales of

refined and petroleum products were Rs. 128,881.19 million and MRPL’s and HPCL’s consolidated sales of

refined and petroleum products were Rs. 729,354.25 million (gross of excise duty) and Rs. 2,959,868.70 million

(gross of excise duty), respectively. The prices of these products are affected by worldwide prices of feedstock,

such as crude oil, and end products such as natural gas, diesel, gasoline, jet fuel, naphtha, paraxylene, benzene,

purified terephthalic acid, monoethylene glycol, polyester fibres, polyethylene, polypropylene, polyvinyl

chloride, polybutadiene rubber, linear alkyl benzene and other chemicals. Historically, the prices of feedstock

and end products have been cyclical and sensitive to relative changes in supply and demand, the availability of

feedstock and general economic conditions. From time to time, the markets for the Company’s petroleum and

petrochemical products have experienced periods of increased imports or capacity additions, which have

A39729228 47

resulted in oversupply and declines in product prices and margins in the domestic market. In such situations in

the past, the Company was forced to export these products. Exports may result in lower margins as export prices

are lower than domestic prices. This is because domestic prices have historically been supported to a degree by

the existence of import tariffs in the Indian market and the fact that, in exporting products, the Company faces

higher freight charges and tariffs imposed by other countries. The withdrawal or lessening of import tariffs in

India would have an adverse effect on the Company’s margins and operating results. Any downturn resulting

from existing or future excess industry capacity or otherwise may have a material adverse effect on its business,

financial condition and results of operations.

Regulation of greenhouse gas emissions could increase the Company’s operational costs and reduce

demand for its products.

Continued political attention to issues concerning climate change, the role of human activity in it and

potential mitigation through regulation could have a material impact on the Company’s operations and financial

results.

International agreements and national or regional legislation and regulatory measures to limit

greenhouse emissions are currently in various stages of discussion or implementation. For instance, the Kyoto

Protocol, along with other regulations, envisions a reduction of greenhouse gas emissions through market-based

regulatory programmes, technology-based or performance-based standards or a combination of them.

These and other greenhouse gas emissions-related laws, policies and regulations, may result in

substantial capital, compliance, operating and maintenance costs. The level of expenditure required to comply

with these laws and regulations is uncertain and is expected to vary by jurisdiction depending on the laws

enacted in each jurisdiction, the Company’s activities in it and market conditions. The Company’s exploration

and production of crude oil and natural gas, and the conversion of crude oil and natural gas into refined products;

the processing, liquefaction and re-gasification of natural gas; the transportation of crude oil, natural gas and

related products and consumers’ or customers’ use of the Company’s products result in greenhouse gas

emissions that could well be regulated.

The effect of regulation on the Company’s financial performance will depend on a number of factors,

including, among others, the sectors covered, the greenhouse gas emissions reductions required by law, the

extent to which it would be entitled to receive emission allowance allocations or need to purchase compliance

instruments on the open market or through auctions, the price and availability of emission allowances and

credits, and the impact of legislation or other regulation on the Company’s ability to recover the costs incurred

through the pricing of the Company’s products. Material price increases or incentives to conserve or use

alternative energy sources could reduce demand for products the Company currently sells and adversely affect

its sales volumes, revenues and margins.

Risks Relating to India

The Company’s business and activities are regulated by the Competition Act, 2002. Any application of

the Competition Act, 2002 to it may be unfavourable, and may have an adverse effect on its business

and results of operations.

The Company’s business and activities are regulated by the Competition Act, 2002. Any application of

the Competition Act, 2002 to it may be unfavourable, and may have an adverse effect on its business and results

of operations.

The Competition Act, 2002, as amended (the “Competition Act”), regulates business practices having

an appreciable adverse effect on competition in the relevant market in India. Under the Competition Act, any

arrangement, understanding or action, whether formal or informal, which causes or is likely to cause an

A39729228 48

appreciable adverse effect on competition is void and attracts substantial penalties. These include agreement

among competitors which directly or indirectly: (i) involves the determination of purchase or sale prices, (ii)

limits or controls production, supply, markets, technical development, investment of provision of services; (iii)

shares the market or source of production or provision of services by way of allocation of geographical area,

type of goods or services or number of customers in the relevant market; or (iv) directly or indirectly results in

bid-rigging or collusive bidding is presumed to have an appreciable adverse effect on competition. The

Competition Act also prohibits abuse of a dominant position by any enterprise.

While combinations including mergers, acquisitions and amalgamations involving Central Public Sector

Enterprises operating in the oil and gas industry are, since 2017, exempted from seeking the approval of the

Competition Commission of India (“CCI”) for a period of five years, there remains uncertainty as to how the

Competition Act and the CCI may still affect industries in India. Any application of the Competition Act to the

Company, or any enforcement proceedings initiated by the CCI, or any adverse publicity that may be generated

due to scrutiny or prosecution by the CCI or if any prohibition or substantial penalties are levied under the

Competition Act, may adversely affect the Company’s business, financial condition and results of operations.

Changes in the Indian Government’s policies in the future could delay the liberalisation of the Indian

economy and adversely affect economic conditions in India generally, which may impact the

Company’s future prospects.

The Indian Government has traditionally exercised and continues to exercise a dominant influence over

many aspects of the Indian economy. India has a mixed economy with a large public sector and an extensively

regulated private sector. The role of the Indian Government and the state governments in the Indian economy

and the effect on producers, consumers, service providers and regulators has remained significant over the years.

The governments have in the past, among other things, imposed controls on the prices of a broad range of goods

and services, restricted the ability of businesses to expand existing capacity and reduce the number of their

employees, and determined the allocation to businesses of raw materials and foreign exchange. Since 1991,

successive Indian governments have pursued policies of economic liberalisation, including significantly

relaxing restrictions on the private sector. Nevertheless, the role of the Indian central and state governments in

the Indian economy as producers, consumers and regulators has remained significant, which can directly or

indirectly affect the Company’s operations. For example, the Indian Government places price caps on sales of

selected fuels by Indian Government-owned entities, including the Company, which directly impacts the sales

turnover of the Company given the volatility of commodity prices experienced in recent years.

Although the current government has announced policies and taken initiatives that support the economic

liberalisation policies that have been pursued by previous governments, the rate of economic liberalisation may

change, and specific laws and policies affecting banking and finance companies, foreign investment and other

matters affecting investment in the Company’s securities may change as well. Any change in these policies may

have a significant impact on the crude oil and natural gas sector development and business and economic

conditions in India generally, which may adversely affect the Company’s business, its financial condition and


The Company is exposed to potentially adverse changes in the tax and royalty regimes of India and

other jurisdictions in which it operates.

The Company operates primarily in India and, also operates in 20 other countries around the world, and

any of these countries, including India and the states of India or other countries in which it may operate in the

future, could modify their tax or royalty laws in ways that would adversely affect the Company. Tax and royalty

rates affecting the crude oil exploration and production industry tend to change in correlation to prices of crude

oil. Significant changes in the tax or royalty regimes of India, including the states of India and other countries

A39729228 49

in which the Company operates, could have a material adverse effect on its liquidity, financial condition and


The Company’s non-consolidated principal statutory levies expenses comprise royalties, which in the

2017 Fiscal Year, the 2018 Fiscal Year and the 2019 Fiscal Year were Rs. 115,748.26 million, Rs. 99,089.92

million and Rs. 134,600.41 million, respectively. Royalty for its international crude oil and natural gas

operations is directly linked to the international prices of crude oil and natural gas.

Royalty on the production of crude oil, casing head Condensate and natural gas is levied in accordance

with the provisions of the Oilfields (Regulation and Development) Act, 1948 and the Petroleum and Natural

Gas Rules. OID cess is levied in terms of the provisions of the Oil Industry (Development) Act, 1974.

Future changes in the tax provisions applicable to the Company could have a material adverse impact

on its financial condition and results of operations.

The regulatory framework in India is evolving, and regulatory changes as and when introduced by the

Indian Government could have a material adverse effect on the Company’s business, financial


The Company is subject to regulation and supervision by the Indian Government. In addition, so long

as the Indian Government’s shareholding in the Company equals or exceeds 51.00 per cent., it will continue to

be classified as an Indian Government company and will be subject to regulations generally applicable to PSUs

in India as well as contractual obligations under the memorandum of understanding signed with the MoPNG.

These regulations concern personnel matters, including the appointment of key management personnel and the

hiring, dismissal and compensation of employees, as well as budgeting and capital expenditure. As a PSU, the

Company’s mandate includes social responsibility that may not be consistent with its commercial objectives.

For instance, the Indian Government mandates that public sector enterprises like the Company give preference

to other public sector enterprises over private sector companies when they bid for its contracts.

In addition to regulations specific to PSUs, the Company is subject to various other governmental

policies, laws and regulations in the crude oil and natural gas sector. The Indian Government has historically

played a key role, and is expected to continue to play a key role, in regulating, reforming and restructuring the

Indian oil and natural gas industry. It exercises substantial control over the growth of the industry, for example,

by awarding blocks in HELP rounds and OALP auctions. There can be no assurance that the Company will be

successful in obtaining interests in blocks, awarded in such rounds in the future. In addition to its direct

participation in the crude oil and natural gas exploration, development and production industry through the

MoPNG and its indirect impact through environmental laws and regulations, the Indian Government awards

licences and leases for exploration, production, development, transportation and sale of hydrocarbons. While

many Indian Government policies, such as the APM for regulating oil prices, have been liberalised, and there

has been a move towards market orientation, the Company continues to be subject to regulated prices for gas,

limitations on export of crude oil and natural gas, and requirements to contribute to Indian Government

subsidies on LPG (for domestic use) and SKO (PDS) as and when required. Further, in the exploration licences

and mining leases in which the Company has an interest, the Indian Government retains the ability to direct its

actions in certain circumstances. The Company’s ability to pursue its own strategy fully in relation to

development, production and marketing of crude oil and natural gas and value-added products in accordance

with its own commercial interests has been affected by such conditions. In addition, the Indian Government

plays an important commercial role in the execution of crude oil and natural gas exploration, development and

production activities in India, in particular through Indian Government-controlled companies such as Oil India

and the Company. The oil and gas industry worldwide is characterised by relatively frequent changes in

economic and fiscal policy by governments depending largely on the prevailing world oil and gas price

environment with periods of high prices usually resulting in an increased tax burden for the industry (whether

A39729228 50

through amendments to legislation or PSCs, changes in interpretation of legislative or contractual terms or

similar actions). Although the fiscal regime applicable to the Indian oil and gas industry has been relatively

stable in the past, there can be no assurance that this stability will continue in the future.

Presently, the MoPNG discharges certain regulatory functions relating to the petroleum industry in India.

Additionally, the Petroleum and Natural Gas Regulatory Board Act, 2006 (the “PNGRB Act”) came into force

in India in April 2006. The PNGRB Act provides for the creation of the PNGRB and vests the PNGRB with

certain powers and functions relating to refining, storage and transportation of petroleum, petroleum products

and natural gas. The majority of the provisions of the PNGRB Act came into effect from 1 October 2007. In the

future, Indian regulators, including the MoPNG and the PNGRB, may adopt new policies, laws or regulations.

The Company’s business could be materially adversely affected by any unfavourable regulatory changes.

In addition, existing Indian regulations require that the Company applies for and obtains various Indian

Government licences and other approvals, including, in some cases, extensions of exploration licences awarded

under the NELP, grants of mining leases, and renewals or extensions of mining leases, in order for it to conduct

its exploration, development and production activities. If in the future it is unable to obtain any such necessary

approvals, its level of reserves and production would be adversely affected.

Terrorist attacks, civil disturbances and regional conflicts in South Asia and elsewhere may have a

material adverse effect on the Company’s business and on the market for securities in India.

India has from time to time experienced instances of social, religious and civil unrest and hostilities

between neighbouring countries. Present relations between India and Pakistan continue to be fragile on the

issues of terrorism, armament and Kashmir. India has also experienced terrorist attacks in some parts of the

country. These hostilities, attacks and tensions could lead to political or economic instability in India and a

possible adverse effect on the Company’s business and its future financial performance. For example, the recent

attack on the Central Reserve Police Force personnel in Pulwama in Kashmir has led to retaliation by India and

escalated hostilities between India and Pakistan. The two countries’ continuing hostilities could exacerbate these

regional hostilities and tensions. Further, India has also experienced social unrest in some parts of the country.

Military activity or terrorist attacks in the future could influence the Indian economy by disrupting

communications and making travel more difficult and such political tensions could create a greater perception

that investments in Indian companies involve higher degrees of risk. Events of this nature in the future, as well

as social and civil unrest within other countries in Asia, could influence the Indian economy and could have a

material adverse effect on the market for securities of Indian companies, including the Notes.

India has also witnessed civil disturbances in recent years, and it is possible that future civil unrest as

well as other adverse social, economic and political events in India could have a negative impact on the

Company. Such incidents could also create a larger perception that investment in Indian companies involves a

higher degree of risk, and could have an adverse impact on its business and the price of the Notes.

Financial instability in other countries could disrupt and negatively affect the Indian economy.

The Indian market and the Indian economy are influenced by economic and market conditions in other

countries. The global financial crisis in 2008 and the subsequent European sovereign debt crisis have resulted

in an adverse impact on the Indian economy. Although economic conditions are different in each country,

investors’ reactions to developments in one country can have adverse effects on the securities of companies in

other countries, including India. A loss of investor confidence in the financial systems of other emerging markets

may cause volatility in the Indian economy in general. Any worldwide financial instability including the global

liquidity crisis which the credit markets may experience, or the continuing sovereign credit crisis, could also

have a negative impact on the Indian economy.

Trade tensions between the United States and major trading partners, most notably China, continue to

escalate following the introduction of a series of tariff measures in both countries. Although China is the primary

A39729228 51

target of United States trade measures, value chain linkages mean that other emerging markets, primarily in

Asia, may also be impacted. China’s policy response to these trade measures also presents a degree of

uncertainty. There is some evidence of China’s monetary policy easing and the potential for greater fiscal

spending, which could worsen existing imbalances in its economy. This could undermine efforts to address

already high debt levels and increase medium-term risks.

In Europe, (i) the possible exit of the United Kingdom from the European Union; (ii) the possible exit

of Scotland, Wales or Northern Ireland from the United Kingdom; (iii) the possibility that other European Union

countries could hold similar referendums to the one held in the United Kingdom and/or call into question their

membership of the European Union; (iv) the possibility that one or more countries that adopted the Euro as

their national currency might decide, in the long term, to adopt an alternative currency; or (v) prolonged periods

of uncertainty connected to these eventualities could have significant negative impacts on international markets.

These could include greater volatility of foreign exchange and financial markets in general due to the increased

uncertainty.

If there is another global or regional financial crisis or a deterioration in the economic or political

environment of India or any of the other countries in which the Company operates, this may have a material

adverse effect on the Company’s business, financial condition and results of operations. Further, in light of the

interconnectivity between India’s economy and other economies, India’s economy is increasingly exposed to

economic and market conditions in other countries. As a result, an economic downturn or recession in the

United States, Europe and other countries in the developed world or a slowdown in economic growth in major

emerging markets like China could have an adverse effect on economic growth in India. A slowdown in the rate

of growth in India’s economy could adversely affect the Company’s cost of funding, business, financial

condition or results of operations.

A prolonged slowdown in economic growth in India could cause the Company’s business to suffer.

The economic growth of India is officially estimated to have decreased to 6.80 per cent. in the 2019

Fiscal Year compared to 7.20 per cent. in the 2018 Fiscal Year.1 The current slowdown in the Indian economy

could adversely affect the Company’s business and its lenders and contractual counterparties, especially if such

a slowdown were to be prolonged. Any substantial decrease in the rate of economic growth or adverse

conditions in Indian economy in general, would be expected to adversely affect the Company’s business, results

of operations, financial conditions and prospects. According to the World Bank data, the growth rate of India’s

GDP was 8.17 per cent. for the calendar year 2016, 7.17 per cent. for the calendar year 2017 and 6.98 per cent.

for the calendar year 2018.2 The course of market interest rates continues to be uncertain due to the increase in

the fiscal deficit and the Indian Government borrowing programme. Any increase in inflation in the future, due

to increases in prices of commodities such as crude oil or otherwise, may result in a tightening of monetary

policy. The uncertainty regarding liquidity and interest rates and any increase in interest rates or reduction in

liquidity could adversely impact the Company’s business.

Any downgrading of India’s debt rating by an international rating agency could have a negative impact

on the Company’s business and the trading price of the Notes.

As of the date of this Offering Circular, India was rated “Baa2” with stable outlook by Moody’s Investor

Services, “BBB-” with stable outlook by Fitch and “BBB-“ with stable outlook by S&P. Going forward, the

sovereign ratings outlook will remain dependent on whether the Indian Government is able to transition the

economy out of a low-growth and high inflation environment, as well as exercise adequate fiscal restraint. There

is no assurance that India’s credit ratings will not be downgraded in the future. Any adverse revisions to India’s

1 See https://www.indiabudget.gov.in/economicsurvey/doc/vol2chapter/echap01_vol2.pdf for more details. 2 See https://data.worldbank.org/indicator/NY.GDP.MKTP.KD.ZG?end=2018&locations=IN&start=1961&view=chart for more details.

A39729228 52

credit ratings for domestic and international debt by international rating agencies may adversely affect the

Company’s ratings and the terms on which the Company is able to finance future capital expenditure or

refinance any existing indebtedness. This could have an adverse effect on the Company’s capital expenditure

plans, business, cash flows and financial performance, and the trading price of the Notes.

Noteholders may experience difficulties in effecting service of legal process, recovering in civil

proceedings for foreign securities laws violations, bringing original actions in India and enforcing a

judgement of a foreign court (except by way of a suit in India on such judgement) against any Domestic

Issuer or its management.

The Company and ONGC Videsh are public limited companies incorporated under the laws of India. All

of the Company’s directors and all of its key management personnel reside in India and all or a substantial

portion of the assets of the Company and such persons are located in India. All of ONGC Videsh’s directors

and all of their respective key management personnel reside in India and such persons are located in India. Any

other Domestic Issuer may be a company incorporated under the laws of India. The directors, key management

personnel and all or a substantial portion of the assets of such a Domestic Issuer may be residing or located in

India. As a result, it may not be possible to effect service of process in jurisdictions outside India upon the

Company, ONGC Videsh or any Domestic Issuer of their respective directors and senior executive officers,

including with respect to matters arising under foreign securities laws.

Recognition and enforcement of foreign judgements is provided for under Section 13 and Section 44A

of the Civil Code on a statutory basis. The United Kingdom has been declared by the Indian Government to be

a reciprocating territory for the purposes of Section 44A of the Civil Code. India is not a party to any

international treaty in relation to the recognition or enforcement of foreign judgements. A judgement of a court

in a country which is not a reciprocating territory may be enforced in India only by a fresh suit upon the

judgement and not by proceedings in execution. Such a suit has to be filed in India within three years from the

date of the judgement in the same manner as any other suit filed to enforce a civil liability in India. It is unlikely

that a court in India would award damages on the same basis as a foreign court if an action were brought in

India. Furthermore, it is unlikely that an Indian court would enforce foreign judgements if that court were of

the view that the amount of damages awarded was excessive or inconsistent with public policy. A party seeking

to enforce a foreign judgement in India is required to obtain approval from RBI to repatriate outside India any

amount recovered pursuant to such execution. For further information, see section headed “Enforcement of

Foreign Judgments in India”.

There may be less company information available in the Indian securities market than in securities

markets in other more developed countries.

There is a difference between the level of regulation, disclosure and monitoring of the Indian securities

markets and the activities of investors, brokers and other participants, and that of markets and market

participants in the United States and other more developed economies. The Securities and Exchange Board of

India (“SEBI”) is responsible for ensuring and improving disclosure and other regulatory standards for the

Indian securities markets. The SEBI has issued regulations and guidelines on disclosure requirements, insider

trading and other matters. There may be, however, less publicly available information about Indian companies

than is regularly made available by public companies in more developed economies. As a result, investors may

have access to less information about the business, prospects, financial condition, cash flows and results of

operations of the Company and its competitors that are listed on stock exchanges in India than companies

subject to reporting requirements of other more developed countries.

There is a lower level of regulation and monitoring of the Indian securities market and the activities of

investors, brokers and other participants than in certain organisations for economic co-operation and

development (“OECD”) countries. The SEBI received statutory powers in 1992 to assist it in carrying out its

A39729228 53

responsibilities for improving disclosure and other regulatory standards for the Indian securities market.

Subsequently, the SEBI has prescribed certain regulations and guidelines in relation to disclosure requirements,

insider dealing and other matters relevant to the Indian securities markets. However, there may still be less

publicly available information about Indian companies than is regularly made available by public companies in

certain OECD countries.

Any changes in the statutory and/or regulatory requirements in connection with taxation could

adversely affect the Company’s operations, profitability and cash flows.

The Indian Government has introduced two major reforms in Indian tax laws, namely the goods and

services tax (“GST”) and provisions relating to general anti-avoidance rules (“GAAR”).

GST replaces the indirect taxes on goods and services, such as central excise duty, service tax, central

sales tax, state value added tax, surcharge and excise being collected by the central and state governments. Since

the implementation of GST and as of the date of this Offering Circular, major products handled by the Company

like MS, HSD, aviation turbine fuel, natural gas and crude oil are not covered by GST and continue to be

governed by the existing taxes. The date from which GST will be levied on these products will be recommended

by GST council. The impact of GST, if levied on these products, cannot be predicted and there can be no

assurance that it would not adversely affect the Company’s business or financial performance. GST may apply

on other aspects of the Company’s business.

GAAR was implemented from 1 April 2018. As per the new proposal, GAAR will not apply to income

accruing, arising or received by any person from transfer of investments made before 1 April 2018. The GAAR

provisions are intended to catch arrangements declared as “impermissible avoidance arrangements”, which is

defined in the Finance Act 2012 as any arrangement, the main purpose or one of the main purposes of which is

to obtain a tax benefit and which satisfy at least one of the following tests: (i) creates rights, or obligations,

which are not ordinarily created between persons dealing at arm’s length; (ii) results, directly or indirectly, in

misuse, or abuse, of the provisions of the Income Tax Act, 1961; (iii) lacks commercial substance or is deemed

to lack commercial substance, in whole or in part; or (iv) is entered into, or carried out, by means, or in a

manner, which are not ordinarily employed for bona fide purposes. The onus to prove that the transaction is not

an “impermissible avoidance agreement” is on the tax authorities. If GAAR provisions are invoked, then the

tax authorities have wide powers, including the denial of tax benefit or the denial of a benefit under a tax treaty.

As the taxation system is intended to undergo a significant overhaul, the consequential effects on the Company

cannot be determined as of the date of this Offering Circular and there can be no assurance that such effects

would not adversely affect the Company’s business, future financial performance or the trading price of the

Notes.

The operations, profitability and cash flows could be adversely affected by any unfavourable changes in

central and state-level statutory and regulatory requirements in connection with direct and indirect taxes and

duties, including income tax, value added tax and service tax, and by any unfavourable interpretation taken by

the relevant taxation authorities, courts or tribunals. If such amendments are brought about in the state laws

relating to value added taxes of other states, the Company’s repossessed assets could be viewed to be subject

to additional value added taxes, which could adversely affect the Company’s operations, profitability and cash

flows.

Tax and other levies imposed by the central and state governments in India that affect the Company’s

tax liability include central and state taxes and other levies, income tax, value added tax, turnover tax, service

tax, stamp duty and other special taxes and surcharges which are introduced on a temporary or permanent basis

from time to time. Moreover, the central and state tax scheme in India is extensive and subject to change from

time to time. Additionally, a company is subject to a surcharge on tax and an education Cess on tax and

surcharge. The central or state government may in the future increase the corporate income tax it imposes. Any

A39729228 54

such future increases or amendments may affect the overall tax efficiency of companies operating in India and

may result in significant additional taxes becoming payable. The policies of the central and state governments

relating to various direct and indirect taxes (including GST, sales tax and income tax), duties (including excise

duties and import duties) and fiscal or other incentives are subject to change. Additional tax exposure could

adversely affect the Company’s business, results of operations or profitability.

The insolvency laws of India may differ from other jurisdictions with which holders of the Notes are

familiar.

As each of ONGC Videsh, each Domestic Issuer and the Company is incorporated under the laws of

India, an insolvency proceeding relating to either of them, even if brought in another jurisdiction, would likely

involve Indian insolvency laws, the procedural and substantive provisions of which may differ from comparable

provisions of another jurisdiction. From the year 2016, the Insolvency and Bankruptcy Code (“IBC”) has been

enacted which has changed the manner and procedure of debt recovery in India. The long-term impact of IBC

has not been ascertained.

Inflation in India may adversely affect the Company’s business.

India has in the past experienced high rates of inflation. The Company can provide no assurance that

high rates of inflation will not increase in the future, which could have an effect on the demand for natural gas

and the Company’s ability to sell those products. In addition, from time to time, the Indian Government has

taken measures to control inflation, which have included tightening monetary policy by raising interest rates,

restricting the availability of credit and inhibiting economic growth.

Inflation, measures to combat inflation and public speculation about possible governmental actions to

combat inflation have also contributed significantly to economic uncertainty in India and heightened volatility

in the Indian capital markets. Periods of higher inflation may also slow the growth rate of the Indian economy

which could also lead to a reduction in demand for natural gas and a decrease in the Company’ssales thereof.

Inflation may also increase some of the Company’s costs and expenses. Moreover, the reporting currency of

the Company’s financial statements is the Indian Rupee, and fluctuations in the value of the Indian Rupee that

result from inflation, could affect the Company’s results of operations and financial condition. To the extent

demand for the Company’s products decreases or costs and expenses increase, and the Company is not able to

pass those increases in costs and expenses on to its customers, its operating margins and operating income may

be adversely affected, which could have a material adverse effect on the Company’s business, financial


A decline in India’s foreign exchange reserves may affect liquidity and interest rates in the Indian

economy, which could adversely impact the Company’s financial condition.

According to a weekly statistical supplement released by the RBI, India’s foreign exchange reserves

totalled over U.S.$430.38 billion as of 26 July 2019.3 Flows to foreign exchange reserves can be volatile, and

past declines may have adversely affected the valuation of the Rupee. Further declines in foreign exchange

reserves, as well as other factors, could adversely affect the valuation of the Rupee which could result in reduced

liquidity and higher interest rates that could adversely affect the Company’s future financial performance.

Depreciation of the Rupee against foreign currencies may have an adverse effect on the Company’s


As of 31 March 2019, the Company’s non-consolidated borrowings in foreign currency were

approximately Rs. 77.93 billion (U.S.$1.126 billion), while substantially all of the Company’s revenues are

denominated in Rupees. Accordingly, depreciation of the Rupee against these currencies will increase the Rupee

3 See https://m.rbi.org.in/Scripts/WSSView.aspx?Id=23119 for more details.

A39729228 55

cost to the Company of servicing and repaying the Company’s foreign currency borrowings. A depreciation of

the Rupee has led to an increase in the costs of imports by the Company which may have an adverse impact on

the Company’s business, financial condition and results of operations.

The risks to financial stability could adversely affect the Company’s business.

The gross non-performing assets in the Indian banking system have grown, while stressed advances,

including standard restructured loans, have risen since September 2014. This deterioration in asset quality is

expected to continue into the next few quarters, however, profitability measured by return on assets and return

on equity remained around the same level during the last two years. The overall risks to the banking sector

remains elevated due to asset quality concerns. In addition, the banking stability map suggests that the overall

risks to the banking sector have moderated marginally. Nonetheless, concerns remain over the continued

weakness in asset quality and profitability. With deterioration in asset quality and the progressive

implementation of Basel III warranting higher buffers, troubled public sector banks (“PSBs”) received capital

infusions via the issuance of recapitalisation bonds and budgetary support.

RBI has replaced previous restructuring mechanisms and in June 2019 put in place a prudential for

resolution of stressed assets for banks and non-banking financial companies with a view to providing a

framework for early recognition, reporting and time-bound resolution of stressed assets. Indian banks and non-

banking financial companies have been subject to stress and continue to deal with non-performing assets for

the years 2018 and 2019.

Although the Company has little or no control over any of these risks or trends and may be unable to

anticipate changes in economic conditions, adverse effects on the Indian banking system could nonetheless

impact the Company’s funding and adversely affect the Company’s business, operations and financial

condition.

An outbreak of an infectious disease or any other serious public health concerns in Asia or elsewhere

could have an adverse effect on the Company’s business and results of operations.

The outbreak of an infectious disease in Asia or elsewhere or any other serious public health concerns

could have a negative effect on the economies, financial markets and business activities in the countries from

where the Company’s raw materials are sourced or in which the Company’s end markets are located, which

could have an adverse effect on the Company’s business. Since 2012, an outbreak of the Middle East

Respiratory Syndrome corona virus has affected several countries, primarily in the Middle East. Southeast Asia

is a hotspot for emerging infectious diseases, including those with pandemic potential. Emerging infectious

diseases have exacted heavy public health and economic tolls. For example, influenza A H5N1 had a profound

effect on the poultry industry. The region is home to dynamic systems in which biological, social, ecological,

and technological processes interconnect in ways that enable microbes to exploit new ecological niches. These

processes include population growth and movement, urbanisation, changes in food production, agriculture and

land use, water and sanitation, and the effect of health systems through generation of drug resistance. Nipah

virus encephalitis is an emerging infectious disease of public health importance in the World Health

Organisation South-East Asia Region. Bangladesh and India have reported human cases of Nipah virus

encephalitis. India’s southern state of Kerala was put under a lot of stress in May 2018 with the most recent

Nipah virus outbreak. The Nipah virus, which is carried by Pteropus fruit bats, is a newly emerging zoonotic

disease that affects both animals and humans. Although the Company has not been adversely affected by such

outbreaks yet, the Company can give no assurance that a future outbreak of an infectious disease among humans

or animals or any other serious public health concerns will not have an adverse effect on the Company’s

business.

A39729228 56

Risks Relating to the Notes and the Guarantees

The Guarantor’s potential liability under the Guarantee in respect of each Series of Guaranteed Notes

will be capped at the Applicable Limit for such Series of Guaranteed Notes and will end after its

respective Guarantee Period. Any demands by the Noteholders must be received by the Guarantor

within the respective Guarantee Period. Further, any payment in excess of the Applicable Limit in

respect of each Series of Guaranteed Notes will require an RBI approval under the FEMA ODI

Regulations.

The primary foreign exchange control legislation in India is FEMA. Pursuant to FEMA, the central

government and the RBI have promulgated various regulations, rules, circulars and press notes in connection

with various aspects of exchange control. A guarantee issued by an Indian company on behalf of its non-Indian

direct or indirect wholly-owned subsidiaries or joint ventures is subject to certain regulations under FEMA,

such as the FEMA Guarantees Laws. Pursuant to the FEMA Guarantee Laws, an Indian company is permitted

to provide a guarantee on behalf of its non-Indian wholly-owned subsidiaries or joint ventures, subject to certain

conditions including, without limitation, such Indian company’s total financial commitment does not exceed

400.00 per cent. of its net worth set forth in its last audited balance sheet at the time of issuance of any such

guarantee. Under the FEMA Guarantee Laws, all financial commitments including all forms of guarantees

should be within an overall ceiling prescribed for the Indian party.

For purposes of the FEMA Guarantee Laws, “total financial commitment” includes the aggregate of

100.00 per cent. of the amount of any equity shares, any preference shares, any loans, guarantee (other than

performance guarantee) issued by the Indian company, 100.00 per cent. of the amount of bank guarantees issued

by a resident bank on behalf of joint venture or non-Indian wholly-owned subsidiaries of the Indian company

provided the bank guarantee is backed by a counter guarantee or collateral by the Indian company, and 50.00 per

cent. of the amount of performance guarantee issued by the Indian company.

In addition, the Indian company (which is providing the guarantee outside India) is not on the RBI’s

exporters’ caution list or list of defaulters and should not be under investigation by any investigative

enforcement agency or regulatory body. The guarantees must specify a maximum amount and duration of the

guarantee upfront, i.e. no guarantee can be open-ended or unlimited; and the Indian company may extend the

guarantee only to a joint venture or non-Indian wholly-owned subsidiaries in which it has equity participation.

In light of the above, the Guarantor’s potential liability under the Guarantee in respect of each Series of

Guaranteed Notes will be capped at an amount equal to 109.00 per cent. of the total aggregate nominal amount

of such Series of Guaranteed Notes outstanding from time to time (the “Applicable Limit” in respect of such

Series of Guaranteed Notes).

In addition, the Guarantee in respect of each Series of Guaranteed Notes shall be in effect for its

respective Guarantee Period only and require that demands under the Guarantee in respect of such Series of

Guaranteed Notes must be received by the Guarantor within their respective Guarantee Period. The Guarantee

in respect of each Series of Guaranteed Notes will be released upon repayment in full of such Guaranteed Notes.

See the sections entitled “Terms and Conditions of the Notes” and “Enforcement of the Guarantee” for more

details.

Further, any payment in excess of the Applicable Limit in respect of each Series of Guaranteed Notes

will require prior RBI approval under the FEMA Guarantee Laws.

A39729228 57

The Guarantee by the Guarantor in respect of each Series of Guaranteed Notes will be capped at the

Applicable Limit in respect of such Series of Guaranteed Notes and may not be sufficient to pay all

amounts due under such Series of Guaranteed Notes or the Trust Deed.

The Guarantee by the Guarantor in respect of each Series of Guaranteed Notes will be capped at the

Applicable Limit in respect of such Series of Guaranteed Notes. See “Terms and Conditions of the Notes –

Status of the Notes and the Guarantee in Respect of the Notes – Limitation on Amount of the Guarantee”. Under

certain circumstances, including as a result of the accrual of interest over time, amounts due under the Trust

Deed or as a result of amounts due under a currency indemnity under the Trust Deed, may exceed the Applicable

Limit of the relevant Series of Guaranteed Notes. With respect to any such excess amount, Noteholders of the

relevant Series of Guaranteed Notes would not have any claim against the Guarantor under the Guarantee in

respect of such Series of Guaranteed Notes. Further, any payment in excess of the Applicable Limits in respect

of the relevant Series of Guaranteed Notes will require prior RBI approval under the FEMA Guarantee Laws.

Redemption of any Indian Issuer Notes prior to maturity may be subject to compliance with applicable

regulatory requirements, including the prior approval of the RBI.

Although a Domestic Issuer has the option to redeem any Indian Issuer Notes at any time following the

occurrence of certain tax events described in the Terms and Conditions of the Notes, there are limitations on

the ability of such Domestic Issuer to redeem such Indian Issuer Notes prior to the date of their maturity

including that the prior approval of an authorised dealer bank (an “AD Bank”) or the RBI has been obtained

and that any conditions of the RBI, the AD Bank or other relevant Indian authorities may impose at the time of

such approval having been satisfied. There can be no assurance that the RBI or the AD Bank will provide such

approval in a timely manner or at all.

Remittances of funds outside India pursuant to indemnification by any Domestic Issuer in relation to

Indian Issuer Notes require prior RBI approval.

Remittance of funds outside India by any Domestic Issuer pursuant to indemnity clauses under the Terms

and Conditions of any Indian Issuer Notes, the Agency Agreement or any other agreements in relation to such

Indian Issuer Notes requires prior RBI approval. Any approval, if and when required, for the remittance of funds

outside India is at the discretion of the RBI and there can be no assurance that such Domestic Issuer will be

able to obtain such approvals.

Payments in connection with the Guarantee under the Guaranteed Notes are subject to RBI guidelines

regarding the remittance of funds outside of India.

Payments with respect to Guarantees under any Guaranteed Notes are subject to applicable law,

including, without limitation, the FEMA Guarantee Laws governing the remittance of funds outside India. Any

approval, if and when required, over and above what is permitted under the automatic route for the remittance

of funds outside India is at the discretion of the RBI and the AD Banks, as the case may be, and the Guarantor

can give no assurance that it will be able to obtain such approvals.

The Notes may not be a suitable investment for all investors.

Each potential investor in the Notes must determine the suitability of that investment in light of its own

circumstances. In particular, each potential investor should:

have sufficient knowledge and experience to make a meaningful evaluation of the Notes, the merits and

risks of investing in the Notes and the information contained or incorporated by reference in this Offering

Circular or any applicable supplement;

A39729228 58

have access to, and knowledge of, appropriate analytical tools to evaluate, in the context of its particular

financial situation, an investment in the Notes and the impact the Notes will have on its overall

investment portfolio;

have sufficient financial resources and liquidity to bear all of the risks of an investment in the Notes,

including where the currency for principal or interest payments is different from the potential investor’s

currency;

understand thoroughly the terms of the Notes and be familiar with the behaviour of any relevant financial

markets; and

be able to evaluate (either alone or with the help of a financial adviser) possible scenarios for economic,

interest rate and other factors that may affect its investment and its ability to bear the applicable risks.

Some Notes are complex financial instruments. Sophisticated institutional investors generally do not

purchase complex financial instruments as stand-alone investments. They purchase complex financial

instruments as a way to reduce risk or enhance yield with an understood, measured, appropriate addition of risk

to their overall portfolios. A potential investor should not invest in Notes which are complex financial

instruments unless it has the expertise (either alone or with the help of a financial adviser) to evaluate how the

Notes will perform under changing conditions, the resulting effects on the value of such Notes and the impact

this investment will have on the potential investor’s overall investment portfolio.

The Notes are not guaranteed by the Republic of India.

The Notes are not the obligations of, or guaranteed by, the Republic of India. Although the Indian

Government owns 64.25 per cent. of the Company’s issued and paid-up share capital as of 31 March 2019, the

Indian Government is not providing a guarantee in respect of the Notes. In addition, the Indian Government is

under no obligation to maintain the solvency of the Company. Therefore, investors should not rely on the Indian

Government to ensure that the Company fulfils its obligations under the Notes.

Notes where denominations involve integral multiples: definitive Notes.

In relation to those Notes which have denominations consisting of a minimum specified denomination

plus one or more higher integral multiples of another smaller amount, it is possible that these Notes may be

traded in amounts that are not integral multiples of such minimum specified denomination. In such a case, a

holder who, as a result of trading such amounts, holds an amount which is less than the minimum specified

denomination in his account with the relevant clearing system at the relevant time may not receive a definitive

Note in respect of such holding (should definitive Notes be printed) and would need to purchase a principal

amount of Notes such that its holding amounts to a specified denomination.

Where the Bearer Global Notes or Registered Global Notes are held by or on behalf of Euroclear and/or

Clearstream, Luxembourg investors will have to rely on the procedures of Euroclear and/or

Clearstream, Luxembourg for transfer, payment and communication with the relevant Issuer.

Notes issued under the Programme may be represented by one or more Bearer Global Notes or

Registered Global Notes. Such Bearer Global Notes or Registered Global Notes may be deposited with a

common depositary for Euroclear and Clearstream, Luxembourg. Except in the circumstances described in the

relevant Bearer Global Note or Registered Global Note, investors will not be entitled to receive Definitive

Bearer Notes or Definitive Registered Notes. Each of Euroclear and Clearstream, Luxembourg will maintain

records of the interests in the Bearer Global Notes or Registered Global Notes held through it. While the Notes

are represented by one or more Bearer Global Notes or Registered Global Notes, investors will be able to

transfer their beneficial interests only through Euroclear or Clearstream, Luxembourg.

A39729228 59

While the Notes are represented by one or more Bearer Global Notes or Registered Global Notes, the

Issuer will discharge its payment obligations under such Notes by making payments to or to the order of the

common depositary for Euroclear and Clearstream, Luxembourg (as the case may be) for distribution to their

account holders. A holder of a beneficial interest in a Bearer Global Note or Registered Global Note must rely

on the procedures of Euroclear or Clearstream, Luxembourg (as the case may be) to receive payments under

the relevant Notes. The relevant Issuer has no responsibility or liability for the records relating to, or payments

made in respect of, beneficial interests in the Bearer Global Notes or Registered Global Notes. Holders of

beneficial interests in the Bearer Global Notes or Registered Global Notes will not have a direct right to vote in

respect of the relevant Notes. Instead, such holders will be permitted to act only to the extent that they are

enabled by Euroclear or Clearstream, Luxembourg (as the case may be) to appoint appropriate proxies.

Similarly, holders of beneficial interests in the Bearer Global Notes or Registered Global Notes will not have a

direct right under the respective Bearer Global Notes or Registered Global Notes to take enforcement action

against the relevant Issuer or (in the case of Guaranteed Notes) the Guarantor following an Event of Default

under the relevant Notes but will have to rely upon their rights under the Trust Deed.

The Terms and Conditions of the Notes are subject to the risk of change of law.

The Terms and Conditions of the Notes are based on English law in effect as of the date of issue of the

relevant Notes. No assurance can be given as to the impact of any possible judicial decision or change to English

law or administrative practice after the date of issue of the relevant Notes.

Performance of contractual obligations.

The ability of the relevant Issuer and/or the Guarantor to make payments in respect of the Notes may

depend upon the due performance by the other parties to the transaction documents of the obligations thereunder

including the performance by the Principal Paying Agent, the Transfer Agent, the Registrar and/or the relevant

Calculation Agent of their respective obligations. Whilst the non-performance of any relevant parties will not

relieve the relevant Issuer and/or the Guarantor of its obligations to make payments in respect of the Notes, the

relevant Issuer and/or the Guarantor may not, in such circumstances, be able to fulfil their respective obligations

to the Noteholders and the Couponholders.

The Trustee may request that the Noteholders provide an indemnity and/or security and/or prefunding

to its satisfaction.

In certain circumstances (including without limitation the giving of notice to the relevant Issuer and the

Guarantor (where relevant) pursuant to Condition 10.1 of the Terms and Conditions of the Notes and the taking

of enforcement steps pursuant to Condition 10.3 of the Terms and Conditions of the Notes), the Trustee may (at

its sole discretion) request the Noteholders to provide an indemnity and/or security and/or prefunding to its

satisfaction before it takes actions on behalf of the Noteholders. The Trustee shall not be obliged to take any

such actions if not first indemnified and/or secured and/or prefunded to its satisfaction. Negotiating and agreeing

to any indemnity and/or security and/or prefunding can be a lengthy process and may impact on when such

actions can be taken. The Trustee may not be able to take actions notwithstanding the provision of an indemnity

or security or prefunding to it in breach of the terms of the Trust Deed constituting the Notes and in such

circumstances, or where there is uncertainty or dispute as to the applicable laws or regulations, to the extent

permitted by the agreements and the applicable law, it will be for the Noteholders to take such actions directly.

The relevant Issuer may be unable to pay interest on, or redeem, the Notes.

On certain dates, including the occurrence of any early redemption event specified in the relevant Pricing

Supplement or otherwise and at maturity of the Notes, the relevant Issuer (or, failing which, in the case of

Guaranteed Notes, the Guarantor) may, and at maturity will, be required to pay interest or redeem all of the

Notes. If such an event were to occur, the relevant Issuer (or, failing which, in the case of Guaranteed Notes,

the Guarantor) may not have sufficient cash on hand (whether due to a serious decline in net operating cash

A39729228 60

flows or otherwise) and may not be able to arrange financing to make such payment or redeem the Notes in

time, or on acceptable terms, or at all. The ability to make interest payments or redeem the Notes in such event

may also be limited by the terms of other debt instruments. Failure to pay interest on the Notes or to repay,

repurchase or redeem tendered Notes by the relevant Issuer (or, failing which, in the case of Guaranteed Notes,

the Guarantor) would constitute an event of default, under the relevant Notes, which may also constitute a

default under the terms of other indebtedness of the Group.

Future discontinuance of LIBOR may adversely affect the value of Floating Rate Notes which reference

LIBOR.

On 27 July 2017, the Chief Executive of the United Kingdom Financial Conduct Authority, which

regulates LIBOR, announced that it does not intend to continue to persuade, or use its powers to compel, panel

banks to submit rates for the calculation of LIBOR to the administrator of LIBOR after 2021. The announcement

indicates that the continuation of LIBOR on the current basis is not guaranteed after 2021. It is not possible to

predict whether, and to what extent, panel banks will continue to provide LIBOR submissions to the

administrator of LIBOR going forward. This may cause LIBOR to perform differently than it did in the past

and may have other consequences that cannot be predicted.

Investors should be aware that, if LIBOR were discontinued or otherwise unavailable, the rate of interest

on Floating Rate Notes which reference LIBOR will be determined for the relevant period by the fall-back

provisions applicable to such Notes. Depending on the manner in which the LIBOR rate is to be determined

under the Conditions, this may (i) if ISDA Determination applies, be reliant upon the provision by reference

banks of offered quotations for the LIBOR rate which, depending on market circumstances, may not be

available at the relevant time or (ii) if Screen Rate Determination applies, result in the effective application of

a fixed rate based on the rate which applied in the previous period when LIBOR was available. Any of the

foregoing could have an adverse effect on the value or liquidity of, and return on, any Floating Rate Notes

which reference LIBOR.

The regulation and reform of “benchmarks” may adversely affect the value of Notes linked to or

referencing such “benchmarks”.

Interest rates and indices which are deemed to be “benchmarks” (including LIBOR) are the subject of

recent national and international regulatory guidance and proposals for reform. Some of these reforms are

already effective while others are still to be implemented. These reforms may cause such benchmarks to perform

differently than in the past, to disappear entirely, or have other consequences which cannot be predicted. Any

such consequence could have a material adverse effect on any Notes linked to or referencing such a

“benchmark”. Regulation (EU) 2016/1011 (the “Benchmarks Regulation”) was published in the Official

Journal of the EU on 29 June 2016 and applies from 1 January 2018. The Benchmarks Regulation applies to

the provision of benchmarks, the contribution of input data to a benchmark and the use of a benchmark within

the EU. It will, among other things, (i) require benchmark administrators to be authorised or registered (or, if

non-EU-based, to be subject to an equivalent regime or otherwise recognised or endorsed) and (ii) prevent

certain uses by EU supervised entities of “benchmarks” of administrators that are not authorised or registered

(or, if non-EU based, not deemed equivalent or recognised or endorsed).

The Benchmarks Regulation could have a material impact on any Notes linked to or referencing a

“benchmark”, in particular, if the methodology or other terms of the “benchmark” are changed in order to

comply with the requirements of the Benchmarks Regulation. Such changes could, among other things, have

the effect of reducing, increasing or otherwise affecting the volatility of the published rate or level of the

“benchmark”.

More broadly, any of the international or national reforms, or the general increased regulatory scrutiny

of “benchmarks”, could increase the costs and risks of administering or otherwise participating in the setting of

A39729228 61

a “benchmark” and complying with any such regulations or requirements. Such factors may have the following

effects on certain “benchmarks” (including LIBOR): (i) discourage market participants from continuing to

administer or contribute to the “benchmark”; (ii) trigger changes in the rules or methodologies used in the

“benchmark” or (iii) lead to the disappearance of the “benchmark”. Any of the above changes or any other

consequential changes as a result of international or national reforms or other initiatives or investigations could

have a material adverse effect on the value of and return on any Notes linked to or referencing a “benchmark”.

Investors should consult their own independent advisers and make their own assessment about the

potential risks imposed by the Benchmarks Regulation reforms in making any investment decision with respect

to any Notes linked to or referencing a “benchmark”.

Modification and Waivers

The Terms and Conditions of the Notes contain provisions for calling meetings of Noteholders to

consider matters affecting their interests generally. These provisions permit defined majorities to bind all

Noteholders, including Noteholders who did not attend and vote at the relevant meeting and Noteholders who

voted in a manner contrary to the majority. Furthermore, there is a risk that the decision of the majority of

holders of the Notes may be adverse to the interests of an individual Noteholder.

The Terms and Conditions of the Notes also provide that the Trustee (i) may agree, without the consent

of the Noteholders, Receiptholders or Couponholders, to any modification of, or to the waiver or authorisation

of any breach or proposed breach of, any of the provisions of the Terms and Conditions of the Notes or the Trust

Deed or the Agency Agreement (except as mentioned in the Trust Deed), or determine, without any such consent

as aforesaid, that any Event of Default or Potential Event of Default (as defined in the Trust Deed) shall not be

treated as such, where, in any such case, it is not, in the opinion of the Trustee, materially prejudicial to the

interests of the Noteholders so to do or (ii) may agree, without any such consent as aforesaid, to any modification

which, in its opinion, is of a formal, minor or technical nature or to correct a manifest error or to comply with

mandatory provisions of law. Any such modification shall be binding on the Noteholders, the Receiptholders

and the Couponholders and any such modification, waiver or authorisation shall be notified by the relevant

Issuer and the Guarantor to the Noteholders in accordance with Condition 14 of the Terms and Conditions of

the Notes as soon as practicable thereafter.

Noteholders’ right to receive payments will rank effectively subordinated to all present and future

secured indebtedness of the relevant Issuer or the Guarantor (where relevant) and to certain tax and

other liabilities preferred by law.

The Notes are unsecured obligations of the relevant Issuer or the Guarantor (where relevant) and will

rank subordinated to all the present and future secured indebtedness of the relevant Issuer or the Guarantor, as

the case may be, and to certain liabilities preferred by law such as to claims of the Indian Government on

account of taxes, and certain liabilities incurred in the ordinary course of the relevant Issuer’s or (where

relevant) the Guarantor’s business. In particular, in the event of bankruptcy, liquidation or winding-up, the

relevant Issuer’s or (where relevant) the Guarantor’s assets will be available to pay obligations on the Notes

only after all of the above liabilities that rank senior to these Notes have been paid. Holders of secured

indebtedness will be entitled to be paid to the extent of the value of such secured assets before any payment

would be made with respect to such Notes. In the event of bankruptcy, liquidation or winding-up, there may not

be sufficient assets remaining, after paying amounts relating to these proceedings, to pay amounts due on the

Notes.

Legal investment considerations may restrict certain investments.

The investment activities of certain investors are subject to legal investment laws and regulations, or

review or regulation by certain authorities. Each potential investor should consult its legal advisers to determine

whether and to what extent (i) the Notes are legal investments for it, (ii) the Notes can be used as collateral for

A39729228 62

various types of borrowing and (iii) other restrictions apply to its purchase or pledge of the Notes. Financial

institutions should consult their legal advisers or the appropriate regulators to determine the appropriate

treatment of the Notes under any applicable risk-based capital or similar rules.

Risks Relating to the Structure of a Particular issue of Notes

Dual Currency Notes have features which are different from single currency issues.

The relevant Issuer may issue Notes with principal or interest payable in one or more currencies which

may be different from the currency in which the Notes are denominated. Potential investors should be aware

that:

the market price of such Notes may be volatile;

they may receive no interest;

payment of principal or interest may occur at a different time or in a different currency than expected;

and

the amount of principal payable at redemption may be less than the nominal amount of such Notes or

even zero.

Failure by an investor to pay a subsequent instalment of partly-paid Notes may result in an investor

losing all of its investment.

The relevant Issuer may issue Notes where the issue price is payable in more than one instalment. Failure

to pay any subsequent instalments could result in an investor losing all of its investment.

Inverse Floating Rate Notes are typically more volatile than conventional floating rate debt.

Inverse Floating Rate Notes have an interest rate equal to a fixed rate minus a rate based upon a reference

rate such as LIBOR. The market values of such Notes typically are more volatile than market values of other

conventional floating rate debt securities based on the same reference rate (and with otherwise comparable

terms). Inverse Floating Rate Notes are more volatile because an increase in the reference rate not only

decreases the interest rate of the Notes but may also reflect an increase in prevailing interest rates, which further

adversely affects the market value of these Notes.

Notes carrying an interest rate which may be converted from fixed to floating interest rates and vice

versa may have lower market values than other Notes.

Fixed/Floating Rate Notes may bear interest at a rate that the Issuer may elect to convert from a fixed

rate to a floating rate, or from a floating rate to a fixed rate. The relevant Issuer’s ability to convert the interest

rate will affect the secondary market and the market value of such Notes since the relevant Issuer may be

expected to convert the rate when it is likely to produce a lower overall cost of borrowing. If the relevant Issuer

converts from a fixed rate to a floating rate, the spread on the Fixed/Floating Rate Notes may be less favourable

than the prevailing spreads on comparable Floating Rate Notes tied to the same reference rate. In addition, the

new floating rate at any time may be lower than the rates on other Notes. If the relevant Issuer converts from a

floating rate to a fixed rate, the fixed rate may be lower than the prevailing rates on its Notes.

The market prices of Notes issued at a substantial discount or premium tend to fluctuate more in

relation to general changes in interest rates than do prices for conventional interest-bearing securities.

The market values of securities issued at a substantial discount or premium to their nominal amount tend

to fluctuate more in relation to general changes in interest rates than do prices for conventional interest-bearing

securities. Generally, the longer the remaining term of the securities, the greater the price volatility as compared

to conventional interest-bearing securities with comparable maturities.

A39729228 63

Investors may lose part or all of their investment in any Index Linked Notes.

If, in the case of a particular Tranche of Notes, the relevant Pricing Supplement specifies that the Notes

are Index-Linked Notes, there is a risk that the investor may lose the value of its entire investment or part of it.

Risks Relating to an Investment in Rupee Denominated Notes

Rupee Denominated Notes are subject to exchange rate risks and exchange controls.

India maintains a managed floating exchange rate system under which market forces determine the

exchange rate for the Rupee. The RBI may, however, intervene in the market to maintain orderly market

conditions and limit sharp fluctuations in the exchange rate. Interventions by the RBI have taken the form of

transparent measures and have included clearly delineated periods and amounts involved, as well as the

explanations for these actions. The RBI’s foreign exchange policy objectives include maintaining price stability,

promoting and maintaining monetary stability and the convertibility of the Rupee, protecting its international

reserves during times of impending or on going exchange crises or national emergencies.

Rupee Denominated Notes are denominated in Rupees and payable in foreign currency. This entails risks

which are not associated with a similar investment in a foreign currency denominated security. Such risks

include, without limitation, the possibility of significant changes in the exchange rate between INR and the

relevant foreign currency if such currency risk is unhedged by an investor or the possibility of imposition or

modification of exchange controls by the RBI. Such risks are usually dependent on various economic and

political events over which the Issuer does not have any control. In the past, exchange rates have been volatile

and the possibility of such volatility in the future may continue. The risk pertaining to exchange rate fluctuation

therefore persists. However, the recent fluctuations in exchange rates are not indicative in nature. If INR

depreciates against the relevant foreign currency, the effective yield on the Rupee Denominated Notes will

decrease below the interest rate on the global bonds, and the amount payable on maturity may be less than the

investment made by the investors. This could result in a total or substantial loss of the investment made by the

investor towards the Rupee Denominated Notes. Rates of exchange between the foreign currency and INR may

be significantly varied over time. However, historical trends do not necessarily indicate future fluctuations in

rates and should not be relied upon as indicative of future trends. Political, economic or stock exchange

developments in India or elsewhere could lead to significant and sudden changes in the exchange rate between

INR and the relevant foreign currency.

Furthermore, overseas investors are eligible to hedge the above-mentioned exchange rate risk only by

way of permitted derivative products with: (i) an AD Bank; (ii) the offshore branches or subsidiaries of Indian

Banks; or (iii) branches of foreign banks having a presence in India.

Rupee Denominated Notes are not freely convertible.

The Rupee is not a freely convertible currency. The convertibility of a currency is dependent, inter alia,

on international and domestic political and economic factors, and on measures taken by the Indian Government

and central banks. Such measures include, without limitation, imposition of regulatory controls or taxes,

issuance of a new currency to replace an existing currency, alteration of the exchange rate or exchange

characteristics by revaluation or revaluation of a currency, or imposition of exchange controls with respect to

the exchange or transfer of a specified currency that would affect exchange rates and the availability of a

specified currency. The taking of any one or more of such measures could adversely affect the value of the

Notes as well as any amount which may be payable upon redemption of the Rupee Denominated Notes.

A39729228 64

Rupee Denominated Notes or Indian Issuer Notes are subject to selling restrictions and may be

transferred only to a limited pool of investors.

Rupee Denominated Notes or any India Issuer Notes denominated in any other currency as may be

applicable can only be issued to, transferred to, sold to, offered as a security by or held by investors who meet

the ECB Investor Requirements. See “Subscription and Sale - India” and “Summary of Relevant Indian Laws

and Regulations”.

Risks Relating to the Market Generally

The secondary market generally.

There is no existing market for any Notes and there can be no assurances that a secondary market for

the Notes will develop or, if a secondary market does develop, that it will provide the Noteholders with liquidity

of investment or that it will continue for the life of the Notes. Therefore, investors may not be able to sell their

Notes easily or at prices that will provide them with a yield comparable to similar investments that have a

developed secondary market. This is particularly the case for Notes that are especially sensitive to interest rate,

currency or market risks, are designed for specific investment objectives or strategies or have been structured

to meet the investment requirements of limited categories of investors. These types of Notes generally would

have a more limited secondary market and more price volatility than conventional debt securities.

The market value of any Notes may fluctuate. Consequently, any sale of Notes by the Noteholders in

any secondary market which may develop may be at prices that may be higher or lower than the initial offering

price depending on many factors, including prevailing interest rates, the Issuer’s performance and the market

for similar securities. No assurance can be given as to the liquidity of, or trading market for, any Notes and an

investor in such Notes must be prepared to hold such Notes for an indefinite period of time or until their

maturity.

Exchange rate risks and exchange controls.

The relevant Issuer and/or the Guarantor (where applicable) will pay principal and interest on the Notes

in the currency specified in the applicable Pricing Supplement (the “Currency”). This presents certain risks

relating to currency conversions if an investor’s financial activities are denominated principally in a currency

or currency unit (the “Investor’s Currency”) other than the Currency. These include the risk that foreign

exchange rates may significantly change (including changes due to devaluation of the Currency or revaluation

of the Investor’s Currency) and the risk that authorities with jurisdiction over the Investor’s Currency may

impose or modify exchange controls. An appreciation in the value of the Investor’s Currency relative to the

Currency would decrease (i) the Investor’s Currency-equivalent interest on the Notes, (ii) the Investor’s

Currency-equivalent value of the principal payable on the Notes and (iii) the Investor’s Currency-equivalent

market value of the Notes. The Indian Government and monetary authorities may impose (as some have done

in the past) exchange controls that could adversely affect an applicable foreign exchange rate. As a result,

investors may receive less interest or principal than expected, or no interest or principal.

Further, Rupee Denominated Notes may be denominated in Rupees and payable in U.S. dollars. This

entails risks which include the possibility of significant changes in the exchange rate between the Rupee and

the U.S. dollar if such currency risk is unhedged by an investor or the possibility of imposition or modification

of exchange controls by the RBI. Such risks are usually dependent on various economic and political events

over which the relevant Issuer and/or the Guarantor (where applicable) does not have any control. Recently,

exchange rates have been volatile and such volatility may continue. However, the recent fluctuations in

exchange rates are not indicative in nature. If the Rupee depreciates against the U.S. dollar, the effective yield

on the Notes may decrease and the amount payable on maturity may be less than the investment made by the

investors. This could result in a total or substantial loss of the investment made by the investor in the Notes.

A39729228 65

Rates of exchange between U.S. dollars and the Rupee may significantly vary over time. However, historical

trends do not necessarily indicate future fluctuations in rates and should not be relied upon as indicative of

future trends. Political, economic or stock exchange developments in India or globally could lead to significant

and sudden changes in the exchange rate between the Rupee and the U.S. dollar.

Investment in the Notes is subject to interest rate risks.

The Noteholders may suffer unforeseen losses due to fluctuations in interest rates. Generally, a rise in

interest rates may cause a fall in the price of the Notes, resulting in a capital loss for the Noteholders. However,

the Noteholders may reinvest the interest payments at higher prevailing interest rates. Conversely, when interest

rates fall, the price of the Notes may rise. The Noteholders may enjoy a capital gain but interest payments

received may be reinvested at lower prevailing interest rates.

Developments in other markets may adversely affect the market price of the Notes.

The market price of the Notes may be adversely affected by declines in the international financial

markets and world economic conditions. The market for the Notes is, to varying degrees, influenced by

economic and market conditions in other markets, especially those in Asia. Although economic conditions are

different in each country, investors’ reaction to developments in one country could affect the securities markets

and the securities of issuers in other countries, including India. Since the global financial crisis of 2008 and

2009, the international financial markets have experienced significant volatility. If similar developments occur

in the international financial markets in the future, the market price of the Notes could be adversely affected.

Investment in the Notes is subject to inflation risks.

Noteholders may suffer diminished returns on their investments due to inflation. Noteholders anticipate

a rate of return based on expected inflation rates at the time of purchase of the Notes. An unexpected increase

in inflation may reduce the actual returns. Conversely, a decrease in inflation rates generally results in lower

prices and lower prices may result in a lower credit demand which would have an adverse impact on the

Company’s business and results of operation.

The market value of the Notes may fluctuate.

Trading prices of the Notes are influenced by numerous factors, including the operating results, business

and/or financial condition of the Company, political, economic, financial and any other factors that can affect

the capital markets, the industry and the Company generally. Adverse economic developments, acts of war and

health hazards in countries in which the Company operates could have a material adverse effect on the

Company’s operations, operating results, business, financial position and performance.

Credit ratings may not reflect all risks.

One or more independent credit rating agencies may assign credit ratings to an issue of Notes. The ratings

may not reflect the potential impact of all risks related to the structure, market, additional factors discussed

above and other factors that may affect the value of the Notes. A credit rating is not a recommendation to buy,

sell or hold securities and may be suspended, reduced or withdrawn by the rating agency at any time. In addition,

there can be no assurance that such credit ratings will be maintained for any given period or that the ratings will

not be revised by the relevant credit rating agencies in the future if, in their judgement, circumstances so warrant.

A downgrade in the credit ratings of such Notes may affect the market price of the Notes.

Developments in other markets may adversely affect the market price of the Notes.

The market price of the Notes may be adversely affected by declines in the international financial

markets and world economic conditions. The market for the Notes is, to varying degrees, influenced by

economic and market conditions in other markets, especially those in Asia. Although economic conditions are

different in each country, investors’ reaction to developments in one country could affect the securities markets

A39729228 66

and the securities of issuers in other countries. Since the global financial crisis of 2008 and 2009, the

international financial markets have experienced significant volatility. If similar developments occur in the

international financial markets in the future, the market price of the Notes could be adversely affected.

A39729228 67

FORM OF THE NOTES

The Notes of each Series will either be in bearer form, with or without interest coupons (“Coupons”)

attached (“Bearer Notes”), or registered form, without interest coupons attached (“Registered Notes”). Notes

to be listed on the SGX-ST will be accepted for clearance through Euroclear and/or Clearstream, Luxembourg

and/or any other clearing system as specified in the applicable Pricing Supplement.

Bearer Notes

Each Tranche of Bearer Notes will initially be represented by either a temporary bearer global note (a

“Temporary Bearer Global Note”) or a permanent bearer global note (a “Permanent Bearer Global Note”

and, together with a Temporary Bearer Global Note, the “Bearer Global Notes”, and each a “Bearer Global

Note”) as indicated in the applicable Pricing Supplement, which, in either case, will be delivered on or prior to

the original issue date of the Tranche to a common depositary for Euroclear and Clearstream, Luxembourg.

While any Note is represented by a Temporary Bearer Global Note, payments of principal, interest (if any) and

any other amount payable in respect of the Notes due prior to the Exchange Date (as defined below) will be

made against presentation of the Temporary Bearer Global Note only to the extent that certification (in a form

to be provided) to the effect that the beneficial owners of interests in such Note are not U.S. persons or persons

who have purchased for resale to any U.S. person, as required by U.S. Treasury regulations, has been received

by Euroclear and/or Clearstream, Luxembourg, as applicable, has given a like certification (based on the

certifications it has received) to the Principal Paying Agent.

On and after the date (the “Exchange Date”) which, for each Tranche in respect of which a Temporary

Bearer Global Note is issued, is 40 days after the Temporary Bearer Global Note is issued, interests in such

Temporary Bearer Global Note will be exchangeable (free of charge) upon a request as described therein either

for (i) interests in a Permanent Bearer Global Note of the same Series or (ii) definitive Bearer Notes (“Definitive

Bearer Notes”) of the same Series with, where applicable, receipts, interest coupons and talons attached (as

indicated in the applicable Pricing Supplement and subject, in the case of Definitive Bearer Notes, to such

notice period as is specified in the applicable Pricing Supplement), in each case against certification of

beneficial ownership as described above, unless such certification has already been given. The holder of a

Temporary Bearer Global Note will not be entitled to collect any payment of interest, principal or other amount

due on or after the Exchange Date unless, upon due certification, exchange of the Temporary Bearer Global

Note for an interest in a Permanent Global Note or for Definitive Bearer Notes is improperly withheld or

refused.

Payments of principal, interest (if any) or any other amounts on a Permanent Bearer Global Note will be

made through Euroclear and/or Clearstream, Luxembourg against presentation or surrender (as the case may

be) of the Permanent Bearer Global Note without any requirement for certification.

The applicable Pricing Supplement will specify that a Permanent Bearer Global Note will be

exchangeable (free of charge), in whole but not in part, for Definitive Bearer Notes with, where applicable,

receipts, interest coupons and talons attached upon either (i) not less than 60 days’ written notice from Euroclear

and/or Clearstream, Luxembourg (acting on the instructions of any holder of an interest in such Permanent

Bearer Global Note) to the Principal Paying Agent as described therein or (ii) only upon the occurrence of an

Exchange Event. For these purposes, “Exchange Event” means that (i) an Event of Default has occurred and

is continuing or (ii) the relevant Issuer has been notified that both Euroclear and Clearstream, Luxembourg have

been closed for business for a continuous period of 14 days (other than by reason of holiday, statutory or

otherwise) or have announced an intention permanently to cease business or have in fact done so and no

successor or alternative clearing system satisfactory to the Trustee is available. The relevant Issuer will promptly

give notice to the Noteholders in accordance with Condition 14 of the Terms and Conditions of the Notes if an

Exchange Event occurs. In the event of the occurrence of an Exchange Event, Euroclear and/or Clearstream,

A39729228 68

Luxembourg (acting on the instructions of any holder of an interest in such Permanent Bearer Global Note) or

the Trustee may give notice to the Principal Paying Agent requesting exchange. Any such exchange shall occur

not later than 45 days after the date of receipt of the first relevant notice by the Principal Paying Agent.

The following legend will appear on all Permanent Bearer Global Notes and all Definitive Bearer Notes

which have an original maturity of more than 365 days and on all receipts, interest coupons and talons relating

to such Notes:

“ANY UNITED STATES PERSON WHO HOLDS THIS OBLIGATION WILL BE SUBJECT TO

LIMITATIONS UNDER THE UNITED STATES INCOME TAX LAWS, INCLUDING THE LIMITATIONS

PROVIDED IN SECTIONS 165(j) AND 1287(a) OF THE U.S. INTERNAL REVENUE CODE OF 1986.”

The sections referred to provide that United States holders, with certain exceptions, will not be entitled

to deduct any loss on Notes, receipts or interest coupons and will not be entitled to capital gains treatment of

any gain on any sale, disposition, redemption or payment of principal in respect of such Notes, receipts, interest

coupons or talons.

Notes which are represented by a Bearer Global Note will only be transferable in accordance with the

rules and procedures for the time being of Euroclear and/or Clearstream, Luxembourg, as the case may be.

Registered Notes

The Registered Notes of each Tranche will initially be represented by a global note in registered form (a

“Registered Global Note”).

Registered Global Notes will be deposited with, and registered in the name of a nominee of, a common

depositary for Euroclear and Clearstream, Luxembourg, as specified in the applicable Pricing Supplement.

Persons holding beneficial interests in Registered Global Notes will be entitled or required, as the case may be,

under the circumstances described below, to receive physical delivery of definitive Notes in fully registered

form (“Definitive Registered Notes”).

Payments of principal, interest and any other amount in respect of the Registered Global Notes will, in

the absence of provision to the contrary, be made to the person shown on the Register (as defined in Condition

6.4 of the Terms and Conditions of the Notes) as the registered holder of the Registered Global Notes. None of

the Issuers, (in the case of Guaranteed Notes) the Guarantor, any Paying Agent or the Registrar (each as defined

in the Terms and Conditions of the Notes) will have any responsibility or liability for any aspect of the records

relating to or payments or deliveries made on account of beneficial ownership interests in the Registered Global

Notes or for maintaining, supervising or reviewing any records relating to such beneficial ownership interests.

Payments of principal, interest or any other amount in respect of the Definitive Registered Notes will,

in the absence of provision to the contrary, be made to the persons shown on the Register on the relevant Record

Date (as defined in Condition 6.4 of the Terms and Conditions of the Notes) immediately preceding the due

date for payment in the manner provided in that Condition.

Interests in a Registered Global Note will be exchangeable (free of charge), in whole but not in part, for

Definitive Registered Notes without receipts, interest coupons or talons attached only upon the occurrence of

an Exchange Event. For these purposes, “Exchange Event” means that (i) an Event of Default has occurred

and is continuing or (ii) the relevant Issuer has been notified that both Euroclear and Clearstream, Luxembourg

have been closed for business for a continuous period of 14 days (other than by reason of holiday, statutory or

otherwise) or have announced an intention permanently to cease business or have in fact done so and no

successor or alternative clearing system satisfactory to the Trustee is available. The relevant Issuer will promptly

give notice to the Noteholders and the Trustee in accordance with Condition 14 of the Terms and Conditions of

the Notes if an Exchange Event occurs. In the event of the occurrence of an Exchange Event, Euroclear and/or

Clearstream, Luxembourg (acting on the instructions of any holder of an interest in such Registered Global

A39729228 69

Note) or the Trustee may give notice to the Registrar requesting exchange. Any such exchange shall occur not

later than 10 days after the date of receipt of the first relevant notice by the Registrar.

Transfer of Interests

Interests in a Registered Global Note may, subject to compliance with all applicable restrictions, be

transferred to a person who wishes to hold such interest in another Registered Global Note. No beneficial owner

of an interest in a Registered Global Note will be able to transfer such interest, except in accordance with the

applicable procedures of Euroclear and Clearstream, Luxembourg, in each case to the extent applicable.

General

Pursuant to the Agency Agreement (as defined in the Terms and Conditions of the Notes), the Principal

Paying Agent shall arrange that, where a further Tranche of Notes is issued which is intended to form a single

Series with an existing Tranche of Notes at a point after the Issue Date of the further Tranche, the Notes of such

further Tranche shall be assigned a common code and ISIN number which are different from the common code

and ISIN assigned to Notes of any other Tranche of the same Series until such time as the Tranches are

consolidated and form a single Series, which shall not be prior to the expiry of the Distribution Compliance

Period applicable to the Notes of such Tranche.

For so long as any of the Notes is represented by a Bearer Global Note or a Registered Global Note (each

a “Global Note”) held on behalf of Euroclear and/or Clearstream, Luxembourg, each person (other than

Euroclear and/or Clearstream, Luxembourg) who is for the time being shown in the records of Euroclear and/or

Clearstream, Luxembourg as the holder of a particular nominal amount of such Notes (in which regard any

certificate or other document issued by Euroclear and/or Clearstream, Luxembourg as to the nominal amount

of such Notes standing to the account of any person shall be conclusive and binding for all purposes save in the

case of manifest error) shall be treated by the Trustee, the relevant Issuer, (in the case of Guaranteed Notes) the

Guarantor and their agents as the holder of such nominal amount of such Notes for all purposes other than with

respect to the payment of principal or interest on such nominal amount of such Notes, for which purpose the

bearer of the relevant Bearer Global Note or the registered holder of the relevant Registered Global Note shall

be treated by the Trustee, the relevant Issuer, (in the case of Guaranteed Notes) the Guarantor and their agents

as the holder of such nominal amount of such Notes in accordance with and subject to the terms of the relevant

Global Note and the Trust Deed and the expressions “Noteholder” and “holder of Notes” and related

expressions shall be construed accordingly.

Any reference herein to Euroclear and/or Clearstream, Luxembourg shall, whenever the context so

permits, be deemed to include a reference to any additional or alternative clearing system specified in the

applicable Pricing Supplement or otherwise selected by the relevant Issuer and (in the case of Guaranteed Notes)

the Guarantor and approved in writing by the Trustee, the Principal Paying Agent and, where applicable, the

Registrar.

No Noteholder, Receiptholder (as defined below) or Couponholder shall be entitled to proceed directly

against the relevant Issuer or the Guarantor (where relevant) unless the Trustee, having become bound so to

proceed, fails so to do within a reasonable period and the failure shall be continuing.

If the applicable Pricing Supplement specifies any modification to the Terms and Conditions of the Notes

as described herein, it is envisaged that, to the extent that such modification relates only to Conditions 1, 5, 6,

7 (except Condition 7.2 of the Terms and Conditions of the Notes), 11, 12, 13, 14 (insofar as such Notes are not

listed or admitted to trade on any stock exchange) or 16, they will not necessitate the preparation of a supplement

to this Offering Circular. If the Terms and Conditions of the Notes of any Series are to be modified in any other

respect, a supplement to this Offering Circular will be prepared, if appropriate.

A39729228 70

So long as any Notes are listed on the SGX-ST and the rules of the SGX-ST so require, the relevant

Issuer shall appoint and maintain a paying agent in Singapore, where such Notes may be presented or

surrendered for payment or redemption, in the event that the Global Note representing such Notes is exchanged

for definitive Notes. In addition, an announcement of such exchange will be made through the SGX-ST and

such announcement will include all material information with respect to the delivery of the definitive Notes,

including details of the paying agent in Singapore.

A39729228 71

FORM OF PRICING SUPPLEMENT

Set out below is the form of Pricing Supplement which will be completed for each Tranche of Notes

issued under the Programme.

[MiFID II product governance/Professional investors and ECPs only target market - Solely for the

purposes of [the/each] manufacturer’s product approval process, the target market assessment in respect of the

Notes has led to the conclusion that: (i) the target market for the Notes is eligible counterparties and professional

clients only, each as defined in [Directive 2014/65/EU (as amended, “MiFID II”); and (ii) all channels for

distribution of the Notes to eligible counterparties and professional clients are appropriate. [Consider any

negative target market.] Any person subsequently offering, selling or recommending the Notes (a

“distributor”) should take into consideration the manufacturer [‘s/s’] target market assessment; however, a

distributor subject to MiFID II is responsible for undertaking its own target market assessment in respect of the

Notes (by either adopting or refining the manufacturer [‘s/s’] target market assessment) and determining

appropriate distribution channels.]

[PRIIPs REGULATION - PROHIBITION OF SALES TO EEA RETAIL INVESTORS - The Notes

are not intended to be offered, sold or otherwise made available to and should not be offered, sold or otherwise

made available to any retail investor in the European Economic Area (the “EEA”). For these purposes, a retail

investor means a person who is one (or more) of: (i) a retail client as defined in point (11) of Article 4(1) of

MiFID II; (ii) a customer within the meaning of Directive (EU) 2016/97 (the “Insurance Distribution

Directive”), where that customer would not qualify as a professional client as defined in point (10) of Article

4(1) of MiFID II; or (iii) not a qualified investor as defined in Regulation (EU) 2017/1129 (the “Prospectus

Regulation”). Consequently, no key information document required by Regulation (EU) No 1286/2014 (as

amended, the “PRIIPs Regulation”) for offering or selling the Notes or otherwise making them available to

retail investors in the EEA has been prepared and therefore offering or selling the Notes or otherwise making

them available to any retail investor in the EEA maybe unlawful under the PRIIPs Regulation.]

[In connection with Section 309B of the Securities and Futures Act (Chapter 289) of Singapore (the

“SFA”) and the Securities and Futures (Capital Markets Products) Regulations 2018 of Singapore (the “CMP

Regulations 2018”), the Issuer has determined, and hereby notifies all relevant persons (as defined in Section

309A(1) of the SFA), that the Notes are prescribed capital markets products (as defined in the CMP Regulations

2018) and Excluded Investment Products (as defined in MAS Notice SFA 04-N12: Notice on the Sale of

Investment Products and MAS Notice FAA-N16: Notice on Recommendation on Investment Products.]4

[Date]

[Oil and Natural Gas Corporation Limited/ONGC Videsh Limited/specify other Issuer]

Issue of [Aggregate Nominal Amount of Tranche] [Title of Notes]

under the U.S.$2,000,000,000 Medium Term Note Programme

This document constitutes the Pricing Supplement relating to the issue of Notes described herein.

Terms used herein shall be deemed to be defined as such for the purposes of the Conditions set forth in

the Offering Circular dated 27 August 2019 [and the supplement[s] to it dated [●] and [●]] (the “Offering

Circular”). This Pricing Supplement contains the final terms of the Notes and must be read in conjunction with

such Offering Circular.

4 [For any Notes to be offered to investors in Singapore, the Issuer to consider whether it needs to re-classify the Notes pursuant to Section 309B of the SFA prior to the launch of the offer]

A39729228 72

[The following alternative language applies if the first tranche of an issue which is being increased was

issued under an Offering Circular with an earlier date.]

Terms used herein shall be deemed to be defined as such for the purposes of the Conditions (the

“Conditions”) set forth in the Offering Circular dated [original date]. This Pricing Supplement contains the

final terms of the Notes and must be read in conjunction with the Offering Circular dated [current date], save

in respect of the Conditions which are extracted from the Offering Circular dated [original date] and are

attached hereto.]

[Include whichever of the following apply or specify as “Not Applicable” (N/A). Note that the numbering

should remain as set out below, even if “Not Applicable” is indicated for individual paragraphs or

subparagraphs. Italics denote directions for completing the Pricing Supplement]

1 (a) Issuer: [Oil and Natural Gas Corporation Limited/ ONCG Videsh

Limited/specify other Issuer]

(b) Legal Entity Identifier of the

Issuer:

[335800FPDZ9MRSNO7N41/335800WPRPCRI524XG

72/[●]]

(c) Guarantor: [Not Applicable/Oil and Natural Gas Corporation

Limited]

2 (a) Series Number: [●]

(b) Tranche Number: [●]

(If fungible with an existing Series, details of that Series,

including the date on which the Notes become fungible)

(c) Date on which the Notes will be

consolidated and form a single

Series:

The Notes will be consolidated and form a single Series

with [identify earlier Tranches] on [the Issue]

Date/exchange of the Temporary Global Note for interests

in the Permanent Global Note, as referred to in paragraph

[●] below, which is expected to occur on or about [date]

[Not Applicable]

3 Specified Currency or Currencies: [●]

4 Aggregate Nominal Amount:

(a) Series: [●]

(b) Series: [●]

(c) Tranche: [●]

5 (a) Issue Price: [●] per cent. of the Aggregate Nominal Amount [plus

accrued interest from [insert date] (in the case of fungible

issues only, if applicable)

[The Issue Price will be payable in the Rupee

Denominated Note Settlement Currency and will be based

on the Aggregate Nominal Amount (in INR) divided by

the conversion rate reported by Financial Benchmarks

India Pvt. Ltd, which is displayed on Bloomberg page

“INRRATE Index” at approximately [●] [a.m./p.m.],

Mumbai time, on [●]]

(b) [Net proceeds: [●]]

A39729228 73

6 (a) Specified Denominations: [●]

(N.B. If the specified denomination is expressed to be

€100,000 or its equivalent and multiples of a lower

nominal amount (for example €1,000), insert the

following:

“[€100,000] and integral multiples of [€1,000] in excess

thereof up to and including [€199,000]. No Notes in

definitive form will be issued with a denomination above

[€199, 000].”)

(N.B. If an issue of Notes is (i) NOT admitted to trading on

a European Economic Area exchange; and (ii) only

offered in the European Economic Area in circumstances

where a prospectus is not required to be published under

the Prospectus Directive the €100,000 minimum

denomination is not required.)

(In the case of Registered Notes, this means the minimum

integral amount in which transfers can be made.)

(b) [Rupee Denominated Notes

Settlement Currency:

U.S. dollars]

(c) Calculation Amount: [●]

(If only one Specified Denomination, insert the Specified

Denomination. If more than one Specified Denomination,

insert the highest common factor. Note: There must be a

common factor in the case of two or more Specified

Denominations.)

7 (a) Issue Date: [●]

(b) Interest Commencement Date: [Specify/Issue Date/Not Applicable]

(N.B. An Interest Commencement Date will not be relevant

for certain Notes, for example Zero Coupon Notes.)

8 Maturity Date: [Fixed rate specify date/Floating rate Interest Payment

Date falling in or nearest to [specify month and year]]

9 Interest Basis: [[●] per cent. Fixed Rate]

[[LIBOR/EURIBOR] +/– [●] per cent. Floating Rate]

[Zero Coupon]

[Index Linked Interest]

[Dual Currency Interest]

[specify other]

(further particulars specified below)

10 Redemption/Payment Basis: [Redemption at par]

[Index Linked Redemption]

[Dual Currency Redemption]

[Partly Paid] [Instalment]

[specify other]

A39729228 74

11 Change of Interest Basis or

Redemption/Payment Basis:

[Applicable/Not Applicable]

(If applicable, specify details of any provision for change

of Notes into another Interest Basis or

Redemption/Payment Basis)

12 (a) Date of board approval for

issuance of Notes [and Guarantee]

obtained:

[●] [and [●], respectively]]/[None required] (N.B. Only

relevant where board (or similar) authorisation is

required for the particular tranche of Notes or related

Guarantee)

(b) Date of regulatory

approval/consent for issuance of

Notes obtained:

[●]/[None required] (N.B. Only relevant where regulatory

(or similar) approval or consent is required for the

particular tranche of Notes)

13 Listing: [Singapore Exchange Securities Trading /specify

other/None]

(N.B. Consider disclosure requirements under the EU

Prospectus Directive applicable to securities admitted to

an EU regulated market)

14 Method of distribution: [Syndicated/Non-syndicated]

PROVISIONS RELATING TO INTEREST (IF ANY) PAYABLE

15 Fixed Rate Note Provisions: [Applicable/Not Applicable]

(If not applicable, delete the remaining subparagraphs of

this paragraph)

(a) Rate(s) of Interest: [●] per cent. per annum payable in arrear on each Interest

Payment Date

(b) Interest Payment Date(s): [●] in each year up to and including the Maturity Date

(Amend appropriately in the case of irregular coupons)

(c) Fixed Coupon Amount(s): [●] per Calculation Amount

(d) Broken Amount(s): [[●] per Calculation Amount, payable on the Interest

Payment Date falling [in/on] [●]] [Not Applicable]

(e) Day Count Fraction: [Actual/Actual (ICMA)] [30/360] [Actual/365 (Fixed)]

[specify other]

(f) Determination Date(s): [[●] in each year] [Not Applicable] (Only relevant where

Day Count Fraction is Actual/Actual (ICMA). In such a

case, insert regular interest payment dates, ignoring

issue date or maturity date in the case of a long or short

first or last coupon)

(g) Other terms relating to the method

of calculating interest for Fixed

Rate Notes:

[None/Give details]

16 Floating Rate Note Provisions [Applicable/Not Applicable]


this paragraph)

A39729228 75

(a) Specified Period(s)/ Specified

Interest Payment Dates:

[●]

(b) Business Day Convention: [Floating Rate Convention/Following Business Day

Convention/Modified Following Business Day

Convention/ Preceding Business Day

Convention/[specify other]]

(c) Additional Business Centre(s): [●]

(d) Manner in which the Rate of

Interest and Interest Amount is to

be determined:

[Screen Rate Determination/ISDA

Determination]/[specify other]

(e) Party responsible for calculating

the Rate of Interest and Interest

Amount (if not the Principal

Paying Agent):

[●]

(f) Screen Rate Determination:

Reference Rate: Reference Rate: [●] month [LIBOR/EURIBOR/specify

other Reference Rate]

Interest Determination

Date(s):

[●] (Second London business day prior to the start of

each Interest Period if LIBOR (other than Sterling or

euro LIBOR), first day of each Interest Period if Sterling

LIBOR and the second day on which the TARGET 2

System is open prior to the start of each Interest Period if

EURIBOR or euro LIBOR)

Relevant Screen Page: [●] (In the case of EURIBOR, if not Reuters EURIBOR

01 ensure it is a page which shows a composite rate or

amend the fallback provisions appropriately)

(g) ISDA Determination:

Floating Rate Option: [●]

Designated Maturity: [●]

Reset Date: [●] (in the case of a LIBOR or EURIBOR based option,

the first day of the Interest Period)

(h) Margin(s): [+/–] [●] per cent. per annum

(i) Minimum Rate of Interest: [●] per cent. per annum

(j) Maximum Rate of Interest: [●] per cent. per annum

(k) Day Count Fraction: [Actual/Actual (ISDA)]

[Actual/Actual]

[Actual/365 (Fixed)]

[Actual/365 (Sterling)]

[Actual/360]

[30/360]

[360/360]

A39729228 76

[Bond Basis]

[30E/360]

[Eurobond Basis]

[30E/360 (ISDA)]

[specify other]

17 Zero Coupon Note Provisions: [Applicable/Not Applicable] (If not applicable, delete the

remaining subparagraphs of this paragraph)

(a) Accrual Yield: [●] per cent. per annum

(b) Reference Price: [●]

(c) Any other formula/basis of

determining amount payable:

[●]

(d) Day Count Fraction in relation to

Early Redemption Amounts:

[30/360] [Actual/360] Actual/365] [specify other]

18 Index Linked Interest Note Provisions: [Applicable/Not Applicable] (If not applicable, delete the


(a) Index/Formula: [give or annex details]

(b) Calculation Agent: [give name]

(c) Calculation Agent responsible for

calculating the Rate of Interest (if

not the Calculation Agent) and

Interest Amount (if not the

Principal Paying Agent):

[●]

(d) Provisions for determining

Coupon where calculation by

reference to Index and/or Formula

is impossible or impracticable:

[●] (Need to include a description of market disruption

or settlement disruption events and adjustment provision)

(e) Specified Period(s)/ Specified

Interest Payment Dates:

[●]

(f) Business Day Convention: [Floating Rate Convention/Following Business Day

Convention/Modified Following Business Day

Convention/ Preceding Business Day Convention/specify

other]

(g) Additional Business Centre(s): [●]

(h) Minimum Rate of Interest: [●] per cent. per annum

(i) Maximum Rate of Interest: [●] per cent. per annum

(j) Day Count Fraction: [●]

19 Dual Currency Interest Note Provisions [Applicable/Not Applicable] (If not applicable, delete the


(a) Rate of Exchange/method of

calculating Rate of Exchange:

[give or annex details]

A39729228 77

(b) Party responsible for calculating

the Rate of Interest (if not the

Calculation Agent) and Interest

Amount (if not the Principal

Paying Agent):

[●]

(c) Provisions for determining

Coupon where calculation by

reference to Index and/or Formula

is impossible or impracticable:

[need to include a description of market disruption or

settlement disruption events and adjustment provisions]

(d) Person at whose option Specified

Currency(ies) is/are payable:

[●]

PROVISIONS RELATING TO REDEMPTION

20 Issuer Call: [Applicable/Not Applicable]


this paragraph)

(a) Optional Redemption [●] Date(s):

(b) Optional Redemption Amount

and method, if any, of calculation

of such amount(s):

[[●] per Calculation Amount/specify other/see Appendix]

(c) If redeemable in part:

(i) Minimum Redemption

Amount:

[●]

(ii) Maximum Redemption

Amount:

[●]

(d) Notice period (if other than as set

out in the Conditions):

[●]

(N.B. If setting notice periods which are different to those

provided in the Conditions, the Issuer is advised to

consider the practicalities of distribution of information

through intermediaries, for example, clearing systems

(which require a minimum of five clearing system business

days’ notice for a call) and custodians, as well as any other

notice requirements which may apply, for example, as

between the Issuer and the Principal Paying Agent or the

Trustee)

21 Investor Put: [Applicable/Not Applicable] (If not applicable, delete the


(a) Optional Redemption Date(s): [●]

(b) Optional Redemption Amount of

each Note and method, if any, of

calculation of such amount(s):


(c) Notice period (if other than as set

out in the Conditions):

[●]

(N.B. If setting notice periods which are different to those

provided in the Conditions, the Issuer is advised to

A39729228 78

consider the practicalities of distribution of information

through intermediaries, for example, clearing systems

(which require a minimum of 15 clearing system business

days’ notice for a put) and custodians, as well as any

other notice requirements which may apply, for example,

as between the Issuer and the Principal Paying Agent or

the Trustee)

22 Final Redemption Amount: [●] per Calculation Amount

In the cases of Rupee Denominated

Notes only:

(a) Calculating Agent responsible for

calculating the Final Redemption

Amount:

[●]

(b) Reference Rate: [Benchmark for calculation of Interest on each Interest

Determination Date will be the prevailing yield of the

Indian Government securities of corresponding maturity.]

(c) Fallback Reference Rate: [●]

23 Early Redemption Amount payable on

redemption for taxation reasons or on

event of default:


GENERAL PROVISIONS APPLICABLE TO THE NOTES

24 Form of Notes: [Bearer Notes:

[Temporary Bearer Global Note exchangeable for a

Permanent Bearer Global Note which is exchangeable for

Definitive Bearer Notes [on 60 days’ notice given at

anytime/ only upon an Exchange Event]]

[Temporary Bearer Global Note exchangeable for

Definitive Bearer Notes on and after the Exchange Date]

[Permanent Bearer Global Note exchangeable for

Definitive Bearer Notes [on 60 days’ notice given at any

time/only upon an Exchange Event]]

(Ensure that this is consistent with the wording in the

“Form of the Notes” section in the Offering Circular and

the Notes themselves. N.B. The exchange upon notice

option should not be expressed to be applicable if the

Specified Denomination of the Notes in paragraph 6

includes language substantially to the following effect:

“[€100,000] and integral multiples of [€1,000] in excess

thereof up to and including [€199, 000].

No Notes in definitive form will be issued with a

denomination above [€199,000]”. Furthermore, such

Specified Denomination construction is not permitted in

relation to any issue of Notes which is to be represented

A39729228 79

on issue by a Temporary Bearer Global Note

exchangeable for Definitive Bearer Notes.)

[Registered Notes:

Registered Global Note ([●] nominal amount) registered

in the name of a nominee for a common depositary for

Euroclear and Clearstream, Luxembourg (specify nominal

amounts)]

25 Additional Financial Centre(s): [Not Applicable/give details] (Note that this item relates

to the place of payment and not Interest Period end dates

to which items 16(c) and 18(g) relate)

26 Talons for future Coupons to be

attached to Definitive Notes in bearer

form (and dates on which such Talons

mature):

[Yes, as the Notes have more than 27 coupon payments,

Talons may be required if, on exchange into definitive

form, more than 27 coupon payments are still to be

made/No]

27 Details relating to Partly Paid Notes:

amount of each payment comprising

the Issue Price and date on which each

payment is to be made and

consequences of failure to pay,

including any right of the Issuer to

forfeit the Notes and interest due on

late payment:

28 Details relating to Instalment Notes:

(a) [Instalment Amount(s): [give details]]

(b) [Instalment Date(s): [give details]]

29 Redenomination applicable: Redenomination [not] applicable (If Redenomination is

applicable, specify the applicable Day Count Fraction

and any provisions necessary to deal with floating rate

interest calculation (including alternative reference

rates))

30 Other terms or special conditions: [Not Applicable/give details]

DISTRIBUTION

31 (a) If syndicated, names of Managers: [Not Applicable/give names]

(b) Stabilising Manager(s) (if any): [Not Applicable/give name(s)]

32 If non-syndicated, name of relevant

Dealer:

[Not Applicable/give name(s)]

33 U.S. Selling Restrictions: Regulation S Category 1

(In the case of Bearer Notes) - [TEFRA D/TEFRA

C/TEFRA not applicable]

(In the case of Registered Notes) - [TEFRA not

applicable]

34 Prohibition of Sales to EEA Retail

Investors:

[Applicable/Not Applicable]

A39729228 80

(If the Notes clearly do not constitute “packaged”

products, “Not Applicable” should be specified. If the

Notes may constitute “packaged” products and no KID

will be prepared, “Applicable” should be specified)

35 Additional selling restrictions: [Not Applicable/give details]

36 Private Bank Rebate/Commissions: [Not Applicable/give details]

OPERATIONAL INFORMATION

37 Any clearing system(s) other than

Euroclear and Clearstream,

Luxembourg and the relevant

identification number(s):

[Not Applicable/give name(s) and number(s)]

38 Delivery: Delivery [against/free of] payment

39 Additional Paying Agent(s) (if any): [●]

GENERAL

40 The aggregate nominal amount of

Notes issued has been translated into

U.S. dollars at the rate of [●],

producing a sum of (for Notes not

denominated in U.S. dollars):

[Not Applicable/U.S.$[●]]

41 Ratings: The Notes to be issued have [not] been rated:

[S&P: [●]];

[Moody’s: [●]];

[Fitch: [●]];

[Other: [●]]

(The above disclosure should reflect the rating allocated

to Notes of the type being issued under the Programme

generally or, where the issue has been specifically rated,

that rating)

ISIN: [●]

Common Code: [●]

[USE OF PROCEEDS

Give details if different from “Use of Proceeds” section in the Offering Circular”.]

[STABILISATION

In connection with this issue, [insert name of Stabilising Manager] (the “Stabilising Manager”) (or persons

acting on behalf of any Stabilising Manager) may over-allot Notes or effect transactions with a view to

supporting the market price of the Notes at a level higher than that which might otherwise prevail. However,

there is no assurance that the Stabilising Manager (or persons acting on behalf of a Stabilising Manager) will

undertake stabilisation action. Any stabilisation action may begin on or after the date on which adequate public

disclosure of the terms of the offer of the Notes is made and, if begun, may be ended at any time, but it must

A39729228 81

end no later than the earlier of 30 days after the issue date of the Notes and 60 days after the date of the

allotment of the Notes. Any stabilisation action or overallotment must be conducted by the relevant Stabilising

Manager (or persons acting on behalf of any Stabilising Manager) in accordance with all applicable laws and

rules.]

[LISTING APPLICATION

This Pricing Supplement comprises the final terms required to list the issue of Notes described herein pursuant

to the U.S.$2,000,000,000 Medium Term Note Programme of Oil and Natural Gas Corporation Limited.]

RESPONSIBILITY

The Issuer [and the Guarantor] accept[s] responsibility for the information contained in this Pricing

Supplement.

Signed on behalf of the Issuer: [Signed on behalf of the Guarantor:

By: By:

Duly authorised Duly authorised]

A39729228 82

TERMS AND CONDITIONS OF THE NOTES

The following, subject to alteration and except for the paragraphs in italics, are the Terms and Conditions of

the Notes which will be incorporated by reference into each Global Note (as defined below) and each definitive

Note, in the latter case only if permitted by the relevant stock exchange or other relevant authority (if any) and

agreed by the relevant Issuer, the Guarantor (where relevant) and the relevant Dealer at the time of issue but,

if not so permitted and agreed, such definitive Note will have endorsed thereon or attached thereto such Terms

and Conditions. The applicable Pricing Supplement in relation to any Tranche of Notes may specify other terms

and conditions which shall, to the extent so specified or to the extent inconsistent with the following Terms and

Conditions, replace or modify the following Terms and Conditions for the purpose of such Notes. The applicable

Pricing Supplement (or the relevant provisions thereof) will be endorsed upon, or attached to, each Global Note

and definitive Note. Reference should be made to “Form of the Notes” for a description of the content of

Pricing Supplements which will specify which of such terms are to apply in relation to the relevant Notes.

This Note is one of a Series (as defined below) of Notes issued by the issuer named in the applicable Pricing

Supplement (as defined below) (the “Issuer”) and constituted by a Trust Deed dated 27 August 2019 (such trust

deed as modified and/or supplemented and/or restated from time to time, the “Trust Deed”) made between

ONGC Videsh Limited (“ONGC Videsh”) as an issuer, Oil and Natural Gas Corporation Limited (“ONGC”)

as an issuer and as guarantor in respect of Notes issued by ONGC Videsh and any New Issuer (as defined below)

(ONGC in its capacity as such, the “Guarantor”) and Citicorp International Limited (the “Trustee” which

expression shall include any successor as Trustee). ONGC may, from time to time, nominate a Subsidiary (as

defined below) of ONGC Videsh as an additional issuer to issue the Notes pursuant to the Programme (each

Subsidiary so nominated, a “New Issuer”). It is intended that each such New Issuer shall accede to the terms

of the Programme by executing new, amended or restated contractual documents, as appropriate, and shall

become and be treated as an “Issuer” and a “Guaranteed Issuer” for the purpose of the Programme. The parties

agree that, in the case of any New Issuer, the term Issuer or Issuers as used herein shall only apply from the

time of accession of such New Issuer to the Programme.

The Notes to be issued by ONGC Videsh or any New Issuer (the “Guaranteed Issuers”) will be guaranteed by

ONGC (in such capacity, the “Guarantor”). The Notes to be issued by ONGC will not be guaranteed.

In these Conditions, references to a “Subsidiary” of any person means a company of which (i) that person

holds a majority of the voting rights of such company or (ii) that person is a member and has the right to appoint

or remove a majority of the board of directors of such company or (iii) that person is a member and controls a

majority of the voting rights of such company.

References herein to the “Notes” shall be references to the Notes of this Series and shall mean:

(i) in relation to any Notes represented by a global Note (a “Global Note”), units of the lowest Specified

Denomination in the Specified Currency;

(ii) any Global Note in bearer form (a “Bearer Global Note”);

(iii) any Global Note in registered form (a “Registered Global Note”);

(iv) definitive Notes in bearer form (“Definitive Bearer Notes”, and together with Bearer Global Notes, the

“Bearer Notes”) issued in exchange for a Bearer Global Note; and

(v) definitive Notes in registered form (“Definitive Registered Notes”, and together with Registered Global

Notes, the “Registered Notes”), whether or not issued in exchange for a Registered Global Note.

The Notes, the Receipts (as defined below) and the Coupons (as defined below) have the benefit of an agency

agreement dated 27 August 2019 (such agency agreement as amended and/or supplemented or restated from

A39729228 83

time to time, the “Agency Agreement”) and made between ONGC Videsh, ONGC, the Trustee, Citibank, N.A.,

London Branch as principal paying agent (the “Principal Paying Agent”, which expression shall include any

successor principal paying agent) and the other paying agents named therein (together with the Principal Paying

Agent, the “Paying Agents”, which expression shall include any additional or successor paying agents) and as

transfer agent (the “Transfer Agent”, which expression shall include any substitute or any additional transfer

agents appointed in accordance with the Agency Agreement) and Citigroup Global Markets Europe AG as

registrar (the “Registrar”, which expression shall include any successor registrar and together with the Paying

Agents and Transfer Agents, the “Agents”).

Interest bearing definitive Bearer Notes have interest coupons (“Coupons”) and, in the case of Notes which,

when issued in definitive form, have more than 27 interest payments remaining, talons for further Coupons

(“Talons”) attached on issue. Any reference herein to Coupons shall, unless the context otherwise requires, be

deemed to include a reference to Talons. Definitive Bearer Notes repayable in instalments have receipts

(“Receipts”) for the payment of the instalments of principal (other than the final instalment) attached on issue.

Registered Notes and Global Notes do not have Receipts, Coupons or Talons attached on issue.

The Pricing Supplement for this Note (or the relevant provisions thereof) is attached to or endorsed on this Note

and supplements these Terms and Conditions (“Conditions”) and may specify other terms and conditions which

shall, to the extent so specified or to the extent inconsistent with these Conditions, replace or modify these

Conditions for the purposes of this Note. References to the “applicable Pricing Supplement” are to the Pricing

Supplement (or the relevant provisions thereof) attached to or endorsed on this Note.

Any reference to “Noteholders” or “holders” in relation to any Notes shall mean (in the case of Bearer Notes)

the holders of the Notes and (in the case of Registered Notes) the persons in whose names the Notes are

registered and shall, in relation to any Notes represented by a Global Note, be construed as provided below.

Any reference herein to “Receiptholders” shall mean the holders of the Receipts and any reference herein to

“Couponholders” shall mean the holders of the Coupons and shall, unless the context otherwise requires,

include the holders of the Talons. The Trustee acts for the benefit of the Noteholders, the Receiptholders and

the Couponholders, in accordance with the provisions of the Trust Deed.

As used herein, “Tranche” means Notes which are identical in all respects (including as to listing) and “Series”

means a Tranche of Notes together with any further Tranche or Tranches of Notes which are (i) expressed to be

consolidated and form a single series and (ii) identical in all respects (including as to listing) except for their

respective Issue Dates, (unless this is a Zero Coupon Note) Interest Commencement Dates and/or Issue Prices.

Copies of the Trust Deed and the Agency Agreement are available for inspection by Noteholders at all

reasonable times during normal business hours at the principal place of business for the time being of the Trustee

(being, at 20/F, Citi Tower, One Bay East, 83 Hoi Bun Road, Kwun Tong, Kowloon, Hong Kong) following

prior written request and proof of holding and identity satisfactory to the Trustee. Copies of the applicable

Pricing Supplement are obtainable at all reasonable times during normal business hours at the specified office

of each of the Paying Agents save that, if this Note is an unlisted Note of any Series, the applicable Pricing

Supplement will only be obtainable by a Noteholder holding one or more unlisted Notes of that Series and such

Noteholder must produce evidence satisfactory to the Issuer and the relevant Agent as to its holding of such

Notes and identity. The Noteholders, the Receiptholders and the Couponholders are deemed to have notice of,

and are entitled to the benefit of, and are bound by, all the provisions of the Trust Deed and the applicable

Pricing Supplement which are applicable to them and are deemed to have notice of all the provisions of the

Agency Agreement that are applicable to them. The statements in these Conditions include summaries of, and

are subject to, the detailed provisions of the Trust Deed and the Agency Agreement.

Words and expressions defined in the Trust Deed and the Agency Agreement or used in the applicable Pricing

Supplement shall have the same meanings where used in these Conditions unless the context otherwise requires

A39729228 84

or unless otherwise stated and provided that, in the event of inconsistency between the Trust Deed and the

Agency Agreement, the Trust Deed will prevail and, in the event of inconsistency between the Trust Deed or

the Agency Agreement and the applicable Pricing Supplement, the applicable Pricing Supplement will prevail.

1 FORM, DENOMINATION AND TITLE

The Notes may be in bearer form (“Bearer Notes”) and/or in registered form (“Registered Notes”) and, in the

case of definitive Notes, will be serially numbered, in the currency (the “Specified Currency”) and the

denominations (the “Specified Denomination(s)”) in each case, as specified in the applicable Pricing

Supplement. Save as provided in Condition 2, Notes of one Specified Denomination may not be exchanged for

Notes of another Specified Denomination.

This Note may be a Fixed Rate Note, a Floating Rate Note, a Zero Coupon Note, an Index Linked Interest Note,

a Dual Currency Interest Note or a combination of any of the foregoing, depending upon the Interest Basis

shown in the applicable Pricing Supplement, which Interest Basis shall be as per the applicable laws.

In respect of any limited liability public company incorporated under the laws of India (a “Domestic Subsidiary

Issuer” and together with ONGC Videsh and the Guarantor (in its capacity as an issuer), the “Domestic

Issuers”), the relevant foreign exchange laws would be the Foreign Exchange Management (Borrowing or

Lending) Regulations 2018 and circulars or notifications issued thereunder by the Reserve Bank of India (the

“RBI”), from time to time including the Master Direction External Commercial Borrowings, Trade Credits and

Structured Obligations dated 26 March 2019, as amended from time to time and the Master Direction on

Reporting under Foreign Exchange Management Act, 1999, dated 1 January 2016, each as amended from time

to time (the “ECB Guidelines”). In respect of any a limited liability private company incorporated outside

India (an “Offshore Subsidiary Issuer”) the relevant foreign exchange laws would be (i) Foreign Exchange

Management (Guarantees) Regulations, 2000, as amended from time to time, (ii) the Foreign Exchange

Management (Transfer or Issue of any Foreign Security) Regulations, 2004, as amended from time to time, (iii)

Master Direction-Direct Investment by Residents in Joint Venture (JV)/Wholly Owned Subsidiary (WOS)

Abroad dated 1 January 2016, as amended from time to time and (iv) Master Direction on Reporting under

Foreign Exchange Management Act, 1999, dated 1 January 2016, as amended from time to time (“FEMA

Guarantee Laws”).

This Note may also be an Index Linked Redemption Note, an Instalment Note, a Dual Currency Redemption

Note, a Partly Paid Note or a combination of any of the foregoing, depending upon the Redemption/Payment

Basis shown in the applicable Pricing Supplement.

Definitive Bearer Notes are issued with Coupons attached, unless they are Zero Coupon Notes in which case

references to Coupons and Couponholders in these Conditions are not applicable.

Subject as set out below, title to the Bearer Notes, Receipts and Coupons will pass by delivery. Title to

Registered Notes will pass upon registration of transfers in the books of the Registrar in accordance with the

provisions of the Agency Agreement. The Issuer, the Guarantor (where relevant), the Trustee, the Principal

Paying Agent, any Paying Agent, the Registrar and the Transfer Agent will (except as otherwise ordered by a

court of competent jurisdiction or as required by law) deem and treat the bearer of any Bearer Note, Receipt or

Coupon and any person in whose name a Registered Note is registered as the absolute owner thereof (whether

or not overdue and notwithstanding any notice of ownership or writing thereon or notice of any previous loss

or theft thereof) for all purposes but, in the case of any Global Note, without prejudice to the provisions set out

in the next succeeding paragraph.

For so long as any of the Notes is represented by a Global Note held on behalf of Euroclear Bank SA/NV

(“Euroclear”) and/or Clearstream Banking S.A. (“Clearstream, Luxembourg”), each person (other than

A39729228 85

Euroclear and/or Clearstream, Luxembourg) who is for the time being shown in the records of Euroclear and/or

Clearstream, Luxembourg as the holder of a particular nominal amount of such Notes (in which regard any

certificate or other document issued by Euroclear and/or Clearstream, Luxembourg as to the nominal amount

of such Notes standing to the account of any person shall be conclusive and binding for all purposes save in the

case of manifest error) shall be treated by the Issuer, the Guarantor (where relevant), the Trustee, any Paying

Agents, the Registrar and the Transfer Agent as the holder of such nominal amount of such Notes for all

purposes other than with respect to the payment of principal or interest on such nominal amount of such Notes,

for which purpose the bearer or registered holder of the relevant Global Note shall be treated by the Issuer, the

Guarantor (where relevant), the Trustee, any Paying Agent, the Registrar and the Transfer Agent as the holder

of such nominal amount of such Notes in accordance with and subject to the terms of the relevant Global Note

and the expressions “Noteholder” and “holder of the Notes” and related expressions shall be construed

accordingly. In determining whether a particular person is entitled to a particular nominal amount of the Notes,

as aforesaid, the Trustee may rely on such evidence and/or information and/or certification as it shall, in its

absolute discretion, think fit and, if it does so rely, such evidence and/or information and/or certification shall,

in the absence of manifest error, be conclusive and binding on all concerned.

The Notes which are represented by a Global Note will be transferable only in accordance with the rules and

procedures for the time being of Euroclear and/or Clearstream, Luxembourg, as the case may be. References to

Euroclear and/or Clearstream, Luxembourg shall, whenever the context so permits, be deemed to include a

reference to any additional or alternative clearing system specified in the applicable Pricing Supplement or as

may otherwise be selected by the Issuer and the Guarantor (where relevant) and approved in writing by the

Trustee, the Principal Paying Agent and, where applicable, the Registrar.

2 TRANSFERS OF REGISTERED NOTES

2.1 Transfers of Interests in Registered Global Notes

Transfers of beneficial interests in Registered Global Notes will be effected by Euroclear and/or

Clearstream, Luxembourg, as the case may be, and, in turn, by other participants and, if appropriate,

indirect participants in such clearing systems acting on behalf of beneficial transferors and transferees

of such interests. A beneficial interest in a Registered Global Note will, subject to compliance with all

applicable legal and regulatory restrictions, be exchangeable for the Registered Notes in definitive form

or for a beneficial interest in another Registered Global Note only in the authorised denominations set

out in the applicable Pricing Supplement and only in accordance with the rules and operating procedures

for the time being of Euroclear and/or Clearstream, Luxembourg, as the case may be, and in accordance

with the terms and conditions specified in the Trust Deed and the Agency Agreement.

2.2 Transfers of Registered Notes Generally

The Registered Notes may not be exchanged for Bearer Notes and vice versa.

Holders of Definitive Registered Notes may exchange such Definitive Registered Notes for interests in

a Registered Global Note of the same type at any time.

Upon the terms and subject to the conditions set forth in the Trust Deed and the Agency Agreement, a

Definitive Registered Note may be transferred in whole or in part (in the authorised denominations set

out in the applicable Pricing Supplement). In order to effect any such transfer: (a) the holder or holders

must (i) surrender the Definitive Registered Note for registration of the transfer of the Definitive

Registered Note (or the relevant part of the Definitive Registered Note) at the specified office of the

Registrar or any Transfer Agent, with the form of transfer thereon duly executed by the holder or holders

thereof or his or their attorney or attorneys duly authorised in writing and (ii) complete and deposit such

other certifications as may be required by the relevant Transfer Agent and (b) the Registrar or, as the

A39729228 86

case may be, the relevant Transfer Agent must, after due and careful enquiry, be satisfied with the

documents of title and the identity of the person making the request and subject to such reasonable

regulations as the Issuer and the Guarantor (where applicable) with the prior written approval of the

Trustee may prescribe or as the Registrar with the prior written approval of the Trustee may prescribe

(such initial regulations being set out in Schedule 3 to the Agency Agreement). Subject as provided

above, the Registrar or, as the case may be, the relevant Transfer Agent will, within seven business days

(being for this purpose a day on which banks are open for business in the city where the specified office

of the Registrar or, as the case may be, the relevant Transfer Agent is located) of the request (or such

longer period as may be required to comply with any applicable fiscal or other laws or regulations)

authenticate and deliver, or procure the authentication and delivery of, at its specified office to the

transferee or (at the risk of the transferee) send by uninsured mail to such address as the transferee may

request, a new Definitive Registered Note of a like aggregate nominal amount to the Definitive

Registered Note (or the relevant part of the Definitive Registered Note) transferred. In the case of the

transfer of part only of a Definitive Registered Note, a new Definitive Registered Note in respect of the

balance of the Definitive Registered Note not transferred will be so authenticated and delivered or (at

the risk of the transferor) sent to the transferor.

2.3 Costs of Registration

Registration of transfers will be effected without charge to the Noteholders by or on behalf of the Issuer,

the Registrar or the relevant Transfer Agent, but upon payment (or the giving of such indemnity and/or

security as the Registrar or the relevant Transfer Agent may require) in respect of any duty, tax or other

governmental charges which may be imposed in relation to it, provided that the Issuer shall not be

responsible for any documentary stamp duty payable on the transfer of Notes effected in the Republic

of India (“India”) unless the Issuer is the counterparty directly liable for that documentary stamp duty

and provided further that the Trustee shall not be liable to pay any such taxes, duties, assessments or

government charges payable in any relevant jurisdiction and shall not be concerned with, or obligated

or required to enquire into, the sufficiency of any amount paid by the Issuer, the Guarantor (where

relevant) or any Noteholder and shall not be liable for any losses as a result of any non-payment by such

Issuer, the Guarantor (where relevant) or any Noteholder.

For the avoidance of doubt, the documentary stamp duty referred to in Condition 2.3 above shall only

apply in respect of transfers of Notes where such Notes are Definitive Registered Notes.

3 STATUS OF THE NOTES AND THE GUARANTEE IN RESPECT OF THE NOTES

3.1 Status of the Notes

The Notes and any relative Receipts and Coupons are direct, senior, unconditional and (subject to the

provisions of Condition 4) unsecured obligations of the Issuer and (subject as stated above) rank and

will rank pari passu, without any preference among themselves, with all other outstanding unsecured

and unsubordinated obligations of the Issuer, present and future, but, in the event of insolvency, only to

the extent permitted by applicable laws relating to creditors’ rights.

3.2 Status of the Guarantee

In the event the Notes are guaranteed by the Guarantor (the “Guaranteed Notes”), the payment of

principal and interest in respect of the Guaranteed Notes and all other moneys expressed to be payable

by the Issuer under or pursuant to the Trust Deed will be unconditionally and irrevocably guaranteed by

the Guarantor (the “Guarantee”). The obligations of the Guarantor under the Guarantee will constitute

direct, senior, unconditional and unsecured obligations of the Guarantor and (subject as stated above)

will rank pari passu with all other outstanding unsecured and unsubordinated obligations of the

A39729228 87

Guarantor, present and future, but, in the event of insolvency, only to the extent permitted by applicable

laws relating to creditors’ rights.

All guarantees by ONGC, as the Guarantor, which would be applicable to the Notes when the Notes are

issued by ONGC Videsh or a Domestic Issuer shall be subject to the ECB Guidelines. All guarantees by

ONGC, as the Guarantor, which would be applicable to the Notes when the Notes are issued by an

Offshore Subsidiary Issuer shall be subject to the FEMA Guarantee Laws.

3.3 Limitation on Amount of the Guarantee

The Guarantor’s potential liability under the Guarantee is capped at an amount equal to 109.0 per cent.

of the total aggregate nominal amount of the Guaranteed Notes outstanding from time to time. Such

aggregate potential liability will (a) be increased in an amount equal to 109.0 per cent. of any increase

in the aggregate nominal amount of the Guaranteed Notes outstanding and (b) be decreased in an amount

equal to 109.0 per cent. of any decrease in the aggregate nominal amount of the Guaranteed Notes

outstanding, in each case, concurrently with any such increase or decrease. The Guarantor will comply

with all requirements under applicable law, including the ODI Regulations, that may be required to give

effect to such increase or decrease in its aggregate potential liability under the Guarantee.

3.4 Release of the Guarantee

The Guarantee in respect of each Series of Notes shall be in effect for the period commencing on (and

including) the relevant Issue Date and ending on (and including) the first anniversary of the relevant

Maturity Date (the “Guarantee Period”). The Guarantee requires that demands under the Guarantee

must be received by the Guarantor within the Guarantee Period. The Guarantee given by the Guarantor

will be released upon repayment in full of amounts due under the relevant Guaranteed Notes.

4 NEGATIVE PLEDGE

4.1 Negative Pledge

So long as any of the Notes remains outstanding, the Issuer and the Guarantor (where relevant) will

ensure that no Relevant Indebtedness of the Issuer or the Guarantor (where relevant) will be secured by

any Security Interest (as defined below) upon, or with respect to, any of the present or future business,

undertaking, assets or revenues (including any uncalled capital) of the Issuer or the Guarantor (where

relevant) unless the Issuer or the Guarantor (where relevant), as the case may be, in the case of the

creation of the Security Interest, before or at the same time and, in any other case, promptly, takes any

and all action necessary to ensure that:

(a) all amounts payable by it under the Notes and the Trust Deed or, as the case may be, the

Guarantor’s obligations under the Guarantee are secured by the Security Interest equally and

rateably with the Relevant Indebtedness to the satisfaction of the Trustee; or

(b) such other Security Interest or other arrangement (whether or not it includes the giving of a

Security Interest) is provided either (i) as the Trustee in its absolute discretion deems not

materially less beneficial to the interests of the Noteholders or (ii) as is approved by an

Extraordinary Resolution (as defined in the Trust Deed) of the Noteholders.

4.2 Interpretation

For the purposes of these Conditions:

(a) “Approved Investor” means (i) a person which has been duly registered with the Securities

Exchange Board of India as a Foreign Institutional Investor in terms of the Securities and

Exchange Board of India (Foreign Institutional Investors) Regulations, 1995, as amended, (ii) a

A39729228 88

Qualified Foreign Investor as defined by the Securities and Exchange Board of India and the

Reserve Bank of India, and includes (iii) a person who is duly registered as a ‘foreign portfolio

investor’ under the Securities and Exchange Board of India (Foreign Portfolio Investors)

Regulations, 2014, as amended;

(b) “Relevant Indebtedness” means (i) any present or future indebtedness (whether being principal,

interest or other amounts) for or in respect of any notes, bonds, debentures, debenture stock, loan

stock or other securities (together, Securities) which (A) by their terms are payable in a currency

other than Rupees or are denominated in Rupees and more than 50 per cent. of the aggregate

nominal amount of which is initially distributed outside of India (provided that, for these

purposes, Securities sold to an Approved Investor will not be regarded as being distributed outside

of India) by or with the authorisation of the Issuer or ONGC, as the case may be, and (B) are for

the time being, or capable of being, quoted, listed or ordinarily dealt in on any stock exchange,

over-the-counter or other securities market, and (ii) any guarantee or indemnity of any such

indebtedness; and

(c) “Security Interest” means any mortgage, charge, pledge, lien or other security interest.

5 INTEREST

All interest payable on the Notes shall be subject to applicable laws including but not limited to the ECB

Guidelines or FEMA Guarantee Laws, as applicable, and in accordance with any specific approval received

by the Issuer (where relevant) from the RBI or the AD Bank, as the case may be, or any other governmental or

regulatory authority.

5.1 Interest on Fixed Rate Notes

Each Fixed Rate Note bears interest on its outstanding nominal amount (or, if it is a Partly Paid Note,

the nominal amount paid up) from (and including) the Interest Commencement Date at the rate(s) per

annum equal to the Rate(s) of Interest. Interest will be payable in arrear on the Interest Payment Date(s)

in each year up to (and including) the Maturity Date.

If the Notes are in definitive form, except as provided in the applicable Pricing Supplement, the amount

of interest payable on each Interest Payment Date in respect of the Fixed Interest Period ending on (but

excluding) such date will amount to the Fixed Coupon Amount. Payments of interest on any Interest

Payment Date will, if so specified in the applicable Pricing Supplement, amount to the Broken Amount

so specified.

As used in these Conditions, “Fixed Interest Period” means the period from (and including) an Interest

Payment Date (or the Interest Commencement Date) to (but excluding) the next (or first) Interest

Payment Date.

Except in the case of Notes in definitive form where an applicable Fixed Coupon Amount or Broken

Amount is specified in the applicable Pricing Supplement, interest is required to be calculated in respect

of any period by applying the Rate of Interest to:

(a) in the case of Fixed Rate Notes which are represented by a Global Note, the aggregate outstanding

nominal amount of the Fixed Rate Notes represented by such Global Note (or, if they are Partly

Paid Notes, the aggregate amount paid up); or

(b) in the case of Fixed Rate Notes in definitive form, the Calculation Amount;

and, in each case, multiplying such sum by the applicable Day Count Fraction, and rounding the resultant

figure to the nearest sub-unit of the relevant Specified Currency, half of any such sub-unit being rounded

A39729228 89

upwards or otherwise in accordance with applicable market convention. Where the Specified

Denomination of a Fixed Rate Note in definitive form comprises more than one Calculation Amount,

the amount of interest payable in respect of such Fixed Rate Note shall be the product of the amount

(determined in the manner provided above) for the Calculation Amount and the amount by which the

Calculation Amount is multiplied to reach the Specified Denomination, without any further rounding.

Each Fixed Rate Note shall have an interest rate which shall be in accordance with applicable Indian

regulatory requirements (including but not limited to the ECB Guidelines or FEMA Guarantee Laws, as

applicable) or any specific approval received by the Issuer (where relevant) from the RBI or the AD

Bank, as the case may be, or any other governmental or regulatory authority.

“Day Count Fraction” means, in respect of the calculation of an amount of interest in accordance with

this Condition 5.1:

(a) if “Actual/Actual (ICMA)” is specified in the applicable Pricing Supplement:

(i) in the case of Notes where the number of days in the relevant period from (and including)

the most recent Interest Payment Date (or, if none, the Interest Commencement Date) to

(but excluding) the relevant payment date (the “Accrual Period”) is equal to or shorter

than the Determination Period during which the Accrual Period ends, the number of days

in such Accrual Period divided by the product of (I) the number of days in such

Determination Period and (II) the number of Determination Dates (as specified in the

applicable Pricing Supplement) that would occur in one calendar year; or

(ii) in the case of Notes where the Accrual Period is longer than the Determination Period

during which the Accrual Period ends, the sum of:

(A) the number of days in such Accrual Period falling in the Determination Period in

which the Accrual Period begins divided by the product of (x) the number of days

in such Determination Period and (y) the number of Determination Dates that

would occur in one calendar year; and

(B) the number of days in such Accrual Period falling in the next Determination Period

divided by the product of (x) the number of days in such Determination Period and

(y) the number of Determination Dates that would occur in one calendar year;

(b) if “30/360” is specified in the applicable Pricing Supplement, the number of days in the period

from (and including) the most recent Interest Payment Date (or, if none, the Interest

Commencement Date) to (but excluding) the relevant payment date (such number of days being

calculated on the basis of a year of 360 days with 12 30-day months) divided by 360; or

(c) if “Actual/365 (Fixed)” is specified in the applicable Pricing Supplement, the actual number of

days in the Accrual Period divided by 365.

In these Conditions:

“Determination Period” means each period from (and including) a Determination Date to (but

excluding) the next Determination Date (including, where either the Interest Commencement Date or

the final Interest Payment Date is not a Determination Date, the period commencing on the first

Determination Date prior to, and ending on the first Determination Date falling after, such date); and

“sub-unit” means, with respect to any currency other than euro, the lowest amount of such currency that

is available as legal tender in the country of such currency and, with respect to euro, one cent.

A39729228 90

5.2 Interest on Floating Rate Notes and Index Linked Interest Notes

(a) Interest Payment Dates

Each Floating Rate Note and Index Linked Interest Note bears interest on its outstanding nominal

amount (or, if it is a Partly Paid Note, the amount paid up) from (and including) the Interest

Commencement Date and such interest will be payable in arrear on either:

(i) the Specified Interest Payment Date(s) in each year specified in the applicable Pricing

Supplement; or

(ii) if no Specified Interest Payment Date(s) is/are specified in the applicable Pricing

Supplement, each date (each such date, together with each Specified Interest Payment

Date, an “Interest Payment Date”) which falls the number of months or other period

specified as the Specified Period in the applicable Pricing Supplement after the preceding

Interest Payment Date or, in the case of the first Interest Payment Date, after the Interest

Commencement Date.

Such interest will be payable in respect of each Interest Period. In these Conditions, “Interest

Period” means the period from (and including) an Interest Payment Date (or the Interest

Commencement Date) to (but excluding) the next (or first) Interest Payment Date.

(b) Rate of Interest

The Rate of Interest payable from time to time in respect of Floating Rate Notes and Index Linked

Interest Notes will be determined in the manner specified in the applicable Pricing Supplement.

The Rate of Interest shall be in accordance with applicable Indian regulatory requirements

(including without limitation, the ECB Guidelines or FEMA Guarantee Laws, as applicable) or

any specific approval received by the Issuer (where relevant) from the RBI or the AD Bank, as

the case may be, or any other governmental or regulatory authority.

(i) ISDA Determination for Floating Rate Notes

Where ISDA Determination is specified in the applicable Pricing Supplement as the

manner in which the Rate of Interest is to be determined, the Rate of Interest for each

Interest Period will be the relevant ISDA Rate plus or minus (as indicated in the applicable

Pricing Supplement) the Margin (if any). For the purposes of this sub-paragraph (i),

“ISDA Rate” for an Interest Period means a rate equal to the Floating Rate that would be

determined by the Principal Paying Agent under an interest rate swap transaction if the

Principal Paying Agent were acting as Calculation Agent for that swap transaction under

the terms of an agreement incorporating the 2006 ISDA Definitions, as published by the

International Swaps and Derivatives Association, Inc. and as amended and updated as at

the Issue Date of the first Tranche of the Notes (the “ISDA Definitions”) and under which:

(A) the Floating Rate Option is as specified in the applicable Pricing Supplement;

(B) the Designated Maturity is a period specified in the applicable Pricing Supplement;

and

(C) the relevant Reset Date is the day specified in the applicable Pricing Supplement.

For the purposes of this subparagraph (i), “Floating Rate”, “Calculation Agent”,

“Floating Rate Option”, “Designated Maturity” and “Reset Date” have the meanings

given to those terms in the ISDA Definitions.

A39729228 91

Unless otherwise stated in the applicable Pricing Supplement the Minimum Rate of

Interest shall be deemed to be zero.

(ii) Screen Rate Determination for Floating Rate Notes

Where Screen Rate Determination is specified in the applicable Pricing Supplement as the

manner in which the Rate of Interest is to be determined, the Rate of Interest for each

Interest Period will, subject as provided below, be either:

(A) the offered quotation; or

(B) the arithmetic mean (rounded if necessary to the fifth decimal place, with 0.000005

being rounded upwards) of the offered quotations,

(expressed as a percentage rate per annum) for the Reference Rate (being either LIBOR

or EURIBOR as specified in the applicable Pricing Supplement) which appears or appear,

as the case may be, on the Relevant Screen Page (or such replacement page on that service

which displays the information) as at 11.00 a.m. (London time, in the case of LIBOR, or

Brussels time, in the case of EURIBOR) on the Interest Determination Date in question

plus or minus (as indicated in the applicable Pricing Supplement) the Margin (if any), all

as determined by the Principal Paying Agent or such other party specified in the applicable

Pricing Supplement. If five or more of such offered quotations are available on the

Relevant Screen Page, the highest (or, if there is more than one such highest quotation,

one only of such quotations) and the lowest (or, if there is more than one such lowest

quotation, one only of such quotations) shall be disregarded by the Principal Paying Agent

or such other party for the purpose of determining the arithmetic mean (rounded as

provided above) of such offered quotations.

The Agency Agreement contains provisions for determining the Rate of Interest in the

event that the Relevant Screen Page is not available or if, in the case of sub-paragraph (A)

above, no such offered quotation appears or, in the case of sub-paragraph (B) above, fewer

than three such offered quotations appear, in each case as at the time specified in the

immediately preceding paragraph.

If the Reference Rate from time to time in respect of Floating Rate Notes is specified in

the applicable Pricing Supplement as being other than LIBOR or EURIBOR, the Rate of

Interest in respect of such Notes will be determined as provided in the applicable Pricing

Supplement.

(c) Minimum and/or maximum Rate of Interest

If the applicable Pricing Supplement specifies a Minimum Rate of Interest for any Interest Period,

then, in the event that the Rate of Interest in respect of such Interest Period determined in

accordance with the provisions of paragraph (b) above of this Condition 5.2 is less than such

Minimum Rate of Interest, the Rate of Interest for such Interest Period shall be such Minimum

Rate of Interest.

If the applicable Pricing Supplement specifies a Maximum Rate of Interest for any Interest

Period, then, in the event that the Rate of Interest in respect of such Interest Period determined in

accordance with the provisions of paragraph (b) above of this Condition 5.2 is greater than such

Maximum Rate of Interest, the Rate of Interest for such Interest Period shall be such Maximum

Rate of Interest.

A39729228 92

Where applicable, the Rate of Interest shall not exceed the rate of interest as specified under the

ECB Guidelines or FEMA Guarantee Laws, as applicable, or any specific approval received by

the Issuer (where relevant) from the RBI or the AD Bank, as the case may be, or any other


(d) Determination of Rate of Interest and calculation of Interest Amounts

The Principal Paying Agent, in the case of Floating Rate Notes where the Principal Paying Agent

is acting as Calculation Agent in respect of such Floating Rate Notes, and the Calculation Agent,

in the case of Index Linked Interest Notes and Floating Rate Notes where the Principal Paying

Agent is not acting as Calculation Agent, will at or as soon as practicable after each time at which

the Rate of Interest is to be determined, determine the Rate of Interest for the relevant Interest

Period. In the case of Index Linked Interest Notes, the Calculation Agent will notify the Principal

Paying Agent of the Rate of Interest for the relevant Interest Period as soon as practicable after

calculating the same. If required to be calculated by it, the Principal Paying Agent or, as the case

may be, the Calculation Agent shall cause the Final Redemption Amount, Early Redemption

Amount, Optional Redemption Amount or any Instalment Amount to be notified to the Trustee,

the Issuer, each of the Paying Agents and the Noteholders as soon as practicable after calculating

the same.

The Principal Paying Agent or, as the case may be, the Calculation Agent will calculate the

amount of interest (the “Interest Amount”) payable on the Floating Rate Notes or Index Linked

Interest Notes for the relevant Interest Period by applying the Rate of Interest to:

(A) in the case of Floating Rate Notes or Index Linked Interest Notes which are represented

by a Global Note, the aggregate outstanding nominal amount of the Notes represented by

such Global Note (or, if they are Partly Paid Notes, the aggregate amount paid up); or

(B) in the case of Floating Rate Notes or Index Linked Interest Notes in definitive form, the

Calculation Amount;

and, in each case, multiplying such sum by the applicable Day Count Fraction, and rounding the

resultant figure to the nearest sub-unit of the relevant Specified Currency, half of any such sub-

unit being rounded upwards or otherwise in accordance with applicable market convention.

Where the Specified Denomination of a Floating Rate Note or an Index Linked Interest Note in

definitive form comprises more than one Calculation Amount, the Interest Amount payable in

respect of such Note shall be the product of the amount (determined in the manner provided

above) for the Calculation Amount and the amount by which the Calculation Amount is

multiplied to reach the Specified Denomination, without any further rounding.

Each Floating Rate Note or Index Linked Interest Note shall have an interest rate which shall be

in accordance with applicable Indian regulatory requirements (including but not limited to the

ECB Guidelines or FEMA Guarantee Laws, as applicable) or any specific approval received by

the Issuer (where relevant) from the RBI or the AD Bank, as the case may be, or any other


“Day Count Fraction” means, in respect of the calculation of an amount of interest in accordance

with this Condition 5.2:

(i) if “Actual/Actual (ISDA)” or “Actual/Actual” is specified in the applicable Pricing

Supplement, the actual number of days in the Interest Period divided by 365 (or, if any

portion of that Interest Period falls in a leap year, the sum of (I) the actual number of days

in that portion of the Interest Period falling in a leap year divided by 366 and (II) the actual

A39729228 93

number of days in that portion of the Interest Period falling in a non-leap year divided by

365);

(ii) if “Actual/365 (Fixed)” is specified in the applicable Pricing Supplement, the actual

number of days in the Interest Period divided by 365;

(iii) if “Actual/365 (Sterling)” is specified in the applicable Pricing Supplement, the actual

number of days in the Interest Period divided by 365 or, in the case of an Interest Payment

Date falling in a leap year, 366;

(iv) if “Actual/360” is specified in the applicable Pricing Supplement, the actual number of

days in the Interest Period divided by 360;

(v) if “30/360”, “360/360” or “Bond Basis” is specified in the applicable Pricing Supplement,

the number of days in the Interest Period divided by 360, calculated on a formula basis as

follows:

�� = [360 × (�� − ��)] + [30 × (�� −��)] + (�� − ��)

360

where:

“Y1” = the year, expressed as a number, in which the first day of the Interest

Period falls;

“Y2” = the year, expressed as a number, in which the day immediately following

the last day of the Interest Period falls;

“M1” = the calendar month, expressed as a number, in which the first day of the

Interest Period falls;

“M2” = the calendar month, expressed as a number, in which the day

immediately following the last day of the Interest Period falls;

“D1” = the first calendar day, expressed as a number, of the Interest Period,

unless such number is 31, in which case D1 will be 30; and

“D2” = the calendar day, expressed as a number, immediately following the last

day included in the Interest Period, unless such number would be 31 and

D1 is greater than 29, in which case D2 will be 30;

(vi) if “30E/360” or “Eurobond Basis” is specified in the applicable Pricing Supplement, the

number of days in the Interest Period divided by 360, calculated on a formula basis as

follows:

�� = [360 × (�� − ��)] + [30 × (�� −��)] + (�� − ��)

360

where:


Period falls;



A39729228 94






unless such number would be 31, in which case D1 will be 30; and


day included in the Interest Period, unless such number would be 31, in

which case D2 will be 30; and

(vii) if “30E/360 (ISDA)” is specified in the applicable Pricing Supplement, the number of

days in the Interest Period divided by 360, calculated on a formula basis as follows:

�� = [360 × (�� − ��)] + [30 × (�� −��)] + (�� − ��)

360

where:


Period falls;








unless (i) that day is the last day of February or (ii) such number would

be 31, in which case D1 will be 30; and


day included in the Interest Period, unless (i) that day is the last day of

February but not the Maturity Date or (ii) such number would be 31, in

which case D2 will be 30.

(e) Notification of Rate of Interest and Interest Amounts

The Principal Paying Agent or, as the case may be, the Calculation Agent will cause the Rate of

Interest and each Interest Amount for each Interest Period and the relevant Interest Payment Date

to be notified to the Issuer and the Trustee and notice thereof to be published in accordance with

Condition 14 as soon as possible after their determination but in no event later than the fourth

London Business Day thereafter. Each Interest Amount and Interest Payment Date so notified

may subsequently be amended (or appropriate alternative arrangements made by way of

adjustment) without prior notice in the event of an extension or shortening of the Interest Period.

Any such amendment will be promptly notified to the Issuer and the Trustee and to the

Noteholders in accordance with Condition 14. For the purposes of this paragraph (e), the

A39729228 95

expression “London Business Day” means a day (other than a Saturday or a Sunday) on which

banks and foreign exchange markets are open for business in London.

(f) Determination or Calculation by Trustee

If for any reason at any relevant time the Principal Paying Agent or, as the case may be, the

Calculation Agent defaults in its obligation to determine the Rate of Interest or the Principal

Paying Agent defaults in its obligation to calculate any Interest Amount in accordance with

subparagraph (b)(i) or subparagraph (b)(ii) above of this Condition 5.2 or as otherwise specified

in the applicable Pricing Supplement, as the case may be, and in each case in accordance with

paragraph (d) above of this Condition 5.2, the Trustee (or an agent appointed by it at the expense

of the Issuer) shall determine the Rate of Interest at such rate as, in its absolute discretion (having

such regard as it shall think fit to the foregoing provisions of this Condition 5, but subject always

to any Minimum Rate of Interest or Maximum Rate of Interest specified in the applicable Pricing

Supplement), it shall deem fair and reasonable in all the circumstances or, as the case may be, the

Trustee (or an agent appointed by it at the expense of the Issuer) shall calculate the Interest

Amount(s) in such manner as it shall deem fair and reasonable in all the circumstances and each

such determination or calculation shall be deemed to have been made by the Principal Paying

Agent or the Calculation Agent, as applicable.

(g) Certificates to be final

All certificates, communications, opinions, determinations, calculations, quotations and

decisions given, expressed, made or obtained for the purposes of the provisions of this Condition

5, whether by the Principal Paying Agent or, if applicable, the Calculation Agent or the Trustee,

shall (in the absence of gross negligence, wilful default or fraud) be binding on the Issuer, the

Guarantor (where relevant), the Trustee, the Principal Paying Agent, the Registrar, the Calculation

Agent (if applicable), the other Paying Agents and all Noteholders, Receiptholders and

Couponholders and (in the absence as aforesaid) no liability to the Issuer, the Guarantor (where

relevant), the Noteholders, the Receiptholders or the Couponholders shall attach to the Principal

Paying Agent or, if applicable, the Calculation Agent or the Trustee or any agent appointed as

contemplated in paragraph (f) of this Condition 5.2 in connection with the exercise or non-

exercise by it of its powers, duties and discretions pursuant to such provisions.

5.3 Interest on Dual Currency Interest Notes

The rate or amount of interest payable in respect of Dual Currency Interest Notes shall be determined in

the manner specified in the applicable Pricing Supplement.

Each Dual Currency Interest Note shall have an interest rate which shall be in accordance with Indian

regulatory requirements (including but not limited to the ECB Guidelines or FEMA Guarantee Laws, as

applicable) or any specific approval received by the Issuer (where relevant) from the RBI or the AD

Bank, as the case may be, or any other governmental or regulatory authority.

5.4 Interest on Partly Paid Notes

In the case of Partly Paid Notes (other than Partly Paid Notes which are Zero Coupon Notes), interest

will accrue as aforesaid on the paid-up nominal amount of such Notes and otherwise as specified in the

applicable Pricing Supplement.

Each Partly Paid Note shall have an interest rate which shall be in accordance with Indian regulatory

requirements (including but not limited to the ECB Guidelines or FEMA Guarantee Laws, as applicable)

A39729228 96

or any specific approval received by the Issuer (where relevant) from the RBI or the AD Bank, as the

case may be, or any other governmental or regulatory authority.

5.5 Accrual of interest

Each Note (or in the case of the redemption of part only of a Note, that part only of such Note) will cease

to bear interest (if any) from and including the date for its redemption unless, upon due presentation

thereof, payment of principal is improperly withheld or refused. In such event, interest will continue to

accrue until whichever is the earlier of:

(a) the date on which all amounts due in respect of such Note have been paid; and

(b) as provided in the Trust Deed.

5.6 Definitions

In these Conditions, if a Business Day Convention is specified in the applicable Pricing Supplement and

(x) if there is no numerically corresponding day on the calendar month in which an Interest Payment

Date should occur or (y) if any Interest Payment Date would otherwise fall on a day which is not a

Business Day, then, if the Business Day Convention specified is:

(a) in any case where Specified Periods are specified in accordance with Condition 5.2(a)(ii), the

Floating Rate Convention, such Interest Payment Date (i) in the case of (x) above, shall be the

last day that is a Business Day in the relevant month and the provisions of (ii) below shall apply

mutatis mutandis or (ii) in the case of (y) above, shall be postponed to the next day which is a

Business Day unless it would thereby fall into the next calendar month, in which event (A) such

Interest Payment Date shall be brought forward to the immediately preceding Business Day and

(B) each subsequent Interest Payment Date shall be the last Business Day in the month which

falls the Specified Period after the preceding applicable Interest Payment Date occurred; or

(b) the Following Business Day Convention, such Interest Payment Date shall be postponed to the

next day which is a Business Day; or

(c) the Modified Following Business Day Convention, such Interest Payment Date shall be

postponed to the next day which is a Business Day unless it would thereby fall into the next

calendar month, in which event such Interest Payment Date shall be brought forward to the

immediately preceding Business Day; or

(d) the Preceding Business Day Convention, such Interest Payment Date shall be brought forward to

the immediately preceding Business Day.

(e) In these Conditions, “Business Day” means a day which is both:

(A) a day on which commercial banks and foreign exchange markets settle payments and are

open for general business (including dealing in foreign exchange and foreign currency

deposits) in London and each Additional Business Centre (other than the TARGET2

System (as defined below)) specified in the applicable Pricing Supplement;

(B) if the TARGET2 System is specified as an Additional Business Centre in the applicable

Pricing Supplement, a day on which the Trans-European Automated Real-Time Gross

Settlement Express Transfer (TARGET2) System or any successor system (the

“TARGET2 System”) is open; and

(C) either (i) in relation to any sum payable in a Specified Currency other than euro, a day on

which commercial banks and foreign exchange markets settle payments and are open for

A39729228 97

general business (including dealing in foreign exchange and foreign currency deposits) in

the principal financial centre of the country of the relevant Specified Currency (if other

than London and any Additional Business Centre and which, if the Specified Currency is

Australian dollars or New Zealand dollars, shall be Sydney and Auckland, respectively)

or (ii) in relation to any sum payable in euro, a day on TARGET2 System is open.

6 PAYMENTS

6.1 Method of payment

Subject as provided below:

(a) payments in a Specified Currency other than euro will be made by credit or transfer to an account

in the relevant Specified Currency maintained by the payee with a bank in the principal financial

centre of the country of such Specified Currency (which, if the Specified Currency is Australian

dollars or New Zealand dollars, shall be Sydney and Auckland, respectively); and

(b) payments in euro will be made by credit or transfer to a euro account (or any other account to

which euro may be credited or transferred) specified by the payee.

6.2 Presentation of definitive Bearer Notes, Receipts and Coupons

Payments of principal in respect of Definitive Bearer Notes will (subject as provided below) be made in

the manner provided in Condition 5.1 only against presentation and surrender (or, in the case of part

payment of any sum due, endorsement) of Definitive Bearer Notes, and payments of interest in respect

of Definitive Bearer Notes will (subject as provided below) be made as aforesaid only against

presentation and surrender (or, in the case of part payment of any sum due, endorsement) of Coupons,

in each case at the specified office of any Paying Agent outside the United States (which expression, as

used herein, means the United States of America and its possessions).

Payments of Instalment Amounts (if any) in respect of Definitive Bearer Notes, other than the final

instalment, will (subject as provided below) be made in the manner provided in Condition 5.1 against

presentation and surrender (or, in the case of part payment of any sum due, endorsement) of the relevant

Receipt in accordance with the preceding paragraph. Payment of the final instalment will be made in the

manner provided in Condition 5.1 only against presentation and surrender (or, in the case of part payment

of any sum due, endorsement) of the relevant Bearer Note in accordance with the preceding paragraph.

Each Receipt must be presented for payment of the relevant instalment together with the Definitive

Bearer Note to which it appertains. Receipts presented without the Definitive Bearer Note to which they

appertain do not constitute valid obligations of the Issuer. Upon the date on which any Definitive Bearer

Note becomes due and repayable, unmatured Receipts (if any) relating thereto (whether or not attached)

shall become void and no payment shall be made in respect thereof.

Fixed Rate Notes in definitive bearer form (other than Dual Currency Notes, Index Linked Notes or

Long Maturity Notes (as defined below)) should be presented for payment together with all unmatured

Coupons appertaining thereto (which expression shall for this purpose include Coupons falling to be

issued on exchange of matured Talons), failing which the amount of any missing unmatured Coupon (or,

in the case of payment not being made in full, the same proportion of the amount of such missing

unmatured Coupon as the sum so paid bears to the sum due) will be deducted from the sum due for

payment. Each amount of principal so deducted will be paid in the manner mentioned above against

surrender of the relative missing Coupon at any time before the expiry of 10 years after the Relevant

Date (as defined in Condition 8.2) in respect of such principal (whether or not such Coupon would

A39729228 98

otherwise have become void under Condition 9) or, if later, five years from the date on which such

Coupon would otherwise have become due, but in no event thereafter.

Upon any Fixed Rate Note in definitive bearer form becoming due and repayable prior to its Maturity

Date, all unmatured Talons (if any) appertaining thereto will become void and no further Coupons will

be issued in respect thereof.

Upon the date on which any Floating Rate Note, Dual Currency Note, Index Linked Note or Long

Maturity Note in definitive bearer form becomes due and repayable, unmatured Coupons and Talons (if

any) relating thereto (whether or not attached) shall become void and no payment or, as the case may be,

exchange for further Coupons shall be made in respect thereof. A “Long Maturity Note” is a Fixed Rate

Note (other than a Fixed Rate Note which on issue had a Talon attached) whose nominal amount on

issue is less than the aggregate interest payable thereon provided that such Note shall cease to be a Long

Maturity Note on the Interest Payment Date on which the aggregate amount of interest remaining to be

paid after that date is less than the nominal amount of such Note.

If the due date for redemption of any Definitive Bearer Note is not an Interest Payment Date, interest (if

any) accrued in respect of such Note from (and including) the preceding Interest Payment Date or, as the

case may be, the Interest Commencement Date shall be payable only against surrender of the relevant

Definitive Bearer Note.

6.3 Payments in respect of Bearer Global Notes

Payments of principal and interest (if any) in respect of Bearer Notes represented by any Bearer Global

Note will (subject as provided below) be made in the manner specified above in relation to Definitive

Bearer Notes and otherwise in the manner specified in the relevant Bearer Global Note against

presentation or surrender of such Bearer Global Note at the specified office of any Paying Agent outside

the United States. A record of each payment made against presentation or surrender of any Bearer Global

Note, distinguishing between any payment of principal and any payment of interest, will be made on

such Bearer Global Note by the Paying Agent to which it was presented and such record shall be prima

facie evidence that the payment in question has been made.

6.4 Payments in respect of Registered Notes

Payments of principal (other than instalments of principal prior to the final instalment) in respect of each

Registered Note (whether or not in global form) will be made against presentation and surrender (or, in

the case of part payment of any sum due, endorsement) of the Registered Note at the specified office of

the Registrar or any of the Paying Agents. Such payments will be made by transfer to the Designated

Account (as defined below) of the holder (or the first named of joint holders) of the Registered Note

appearing in the register of holders of the Registered Notes maintained by the Registrar (the “Register”)

(a) where in global form, at the close of the business day (being for this purpose a day on which Euroclear

and Clearstream, Luxembourg are open for business) before the relevant due date, and (b) where in

definitive form, at the close of business on the fifth business day (being for this purpose a day on which

banks are open for business in the city where the specified office of the Registrar is located) before the

relevant due date. For these purposes, “Designated Account” means the account (which, in the case of

a payment in Japanese yen to a non resident of Japan, shall be a non-resident account) maintained by a

holder with a Designated Bank and identified as such in the Register and “Designated Bank” means (in

the case of payment in a Specified Currency other than euro) a bank in the principal financial centre of

the country of such Specified Currency (which, if the Specified Currency is Australian dollars or New

Zealand dollars, shall be Sydney and Auckland, respectively) and (in the case of a payment in euro) any

bank which processes payments in euro.

A39729228 99

Payments of interest and payments of instalments of principal (other than the final instalment) in respect

of each Registered Note (whether or not in global form) will be to the holder (or the first named of joint

holders) of the Registered Note appearing in the Register (i) where in global form, at the close of the

business day (being for this purpose a day on which Euroclear and Clearstream, Luxembourg are open

for business) before the relevant due date, and (ii) where in definitive form, at the close of business on

the fifteenth day (whether or not such fifteenth day is a Business Day) before the relevant due date (the

“Record Date”) at his address shown in the Register on the Record Date and made by transfer on the

due date in the manner provided in the preceding paragraph of this Condition 6.4. Payment of the interest

due in respect of each Registered Note on redemption and the final instalment of principal will be made

in the same manner as payment of the principal amount of such Registered Note.

No commissions or expenses shall be charged to such holders by the Registrar in respect of any payments

of principal or interest in respect of the Registered Notes.

None of the Issuer, the Guarantor (where relevant), the Trustee, the Registrar, any Paying Agent or any

other Agent will have any responsibility or liability for any aspect of the records relating to, or payments

made on account of, beneficial ownership interests in the Registered Global Notes or for maintaining,

supervising or reviewing any records relating to such beneficial ownership interests.

6.5 General provisions applicable to payments

The holder of a Global Note shall be the only person entitled to receive payments in respect of Notes

represented by such Global Note and the Issuer or the Guarantor (where relevant) will be discharged by

payment to, or to the order of, the holder of such Global Note in respect of each amount so paid. Each

of the persons shown in the records of Euroclear and/or Clearstream, Luxembourg as the beneficial

holder of a particular nominal amount of Notes represented by such Global Note must look solely to

Euroclear and/or Clearstream, Luxembourg, as the case may be, for his share of each payment so made

by the Issuer or the Guarantor (where relevant) in respect of such Global Note to, or to the order of, the

holder of such Global Note.

So long as the Global Note is held on behalf of Euroclear, Clearstream or any other clearing system,

each payment in respect of the Global Note will be made to the person shown as the holder in the Register

at the close of business of the relevant clearing system on the Clearing System Business Date before the

due date for such payments, where “Clearing System Business Day” means a weekday (Monday to

Friday, inclusive) except 25 December and 1 January.

Notwithstanding the foregoing provisions of this Condition 6, if any amount of principal and/or interest

in respect of Bearer Notes is payable in U.S. dollars, such U.S. dollar payments of principal and/or

interest in respect of such Notes will be made at the specified office of a Paying Agent in the United

States only if:

(a) the Issuer has appointed Paying Agents with specified offices outside the United States with the

reasonable expectation that such Paying Agents would be able to make payment in U.S. dollars

at such specified offices outside the United States of the full amount of principal and interest on

the Bearer Notes in the manner provided above when due;

(b) payment of the full amount of such principal and interest at all such specified offices outside the

United States is illegal or effectively precluded by exchange controls or other similar restrictions

on the full payment or receipt of principal and interest in U.S. dollars; and

(c) such payment is then permitted under United States law without involving, in the opinion of the

Issuer and the Guarantor (where relevant), adverse tax consequences to the Issuer or the

Guarantor (where relevant).

A39729228 100

6.6 Payment Day

If the date for payment of any amount in respect of any Note, Receipt or Coupon is not a Payment Day,

the holder thereof shall not be entitled to payment until the next following Payment Day in the relevant

place and shall not be entitled to further interest or other payment in respect of such delay. For these

purposes, “Payment Day” means any day which (subject to Condition 10) is:

(a) a day on which commercial banks and foreign exchange markets settle payments and are open

for general business (including dealing in foreign exchange and foreign currency deposits) in:

(i) in the case of Notes in definitive form only, the relevant place of presentation; and

(ii) each Additional Financial Centre specified in the applicable Pricing Supplement (other

than TARGET2 System); and

(b) if TARGET2 System is specified as an Additional Financial Centre in the applicable Pricing

Supplement, a day on which the TARGET2 System is open; and

(c) either (i) in relation to any sum payable in a Specified Currency other than euro, a day on which

commercial banks and foreign exchange markets settle payments and are open for general

business (including dealing in foreign exchange and foreign currency deposits) in the principal

financial centre of the country of the relevant Specified Currency which, if the Specified Currency

is Australian dollars or New Zealand dollars, shall be Sydney and Auckland, respectively) or (ii)

in relation to any sum payable in euro, a day on which the TARGET2 System is open.

6.7 Interpretation of principal and interest

Any reference in these Conditions to principal in respect of the Notes shall be deemed to include, as

applicable:

(a) any additional amounts which may be payable with respect to principal under Condition 8 or

under any undertaking or covenant given in addition thereto, or in substitution therefor, pursuant

to the Trust Deed;

(b) the Final Redemption Amount of the Notes;

(c) the Early Redemption Amount of the Notes;

(d) the Optional Redemption Amount(s) (if any) of the Notes;

(e) in relation to Notes redeemable in instalments, the Instalment Amounts;

(f) in relation to Zero Coupon Notes, the Amortised Face Amount (as defined in Condition 7.4); and

(g) any premium and any other amounts (other than interest) which may be payable by the Issuer

under or in respect of the Notes.

Any reference in these Conditions to interest in respect of the Notes shall be deemed to include, as

applicable, any additional amounts which may be payable with respect to interest under Condition 8 or

under any undertaking or covenant given in addition thereto, or in substitution therefor, pursuant to the

Trust Deed.

6.8 Payments Subject to Fiscal and Other Laws

Payments will be subject in all cases, to (a) any fiscal or other laws and regulations applicable thereto,

but without prejudice to the provisions of Condition 8, in the place of payment; and (b) any withholding

or deduction required pursuant to an agreement described in Section 1471(b) of the U.S. Internal

Revenue Code of 1986, as amended (the “Code”) or otherwise imposed pursuant to Section 1471

A39729228 101

through 1474 of the Code, any regulation or agreements thereunder, official interpretations thereof, or

any law implementing an intergovernmental approach thereto.

6.9 Provisions relating to Rupee denominated Notes

The following provisions will apply to any Notes denominated in Rupees:

(a) Payments in U.S. dollars

Principal and interest will be payable by the Issuer in U.S. dollars. The amount of principal and

interest to be paid will be determined by the Calculation Agent and will be translated from Rupees

to U.S. dollars at the Reference Rate (as defined below) for conversion of Rupees to U.S. dollars

on the applicable Rate Fixing Date (as defined below).

(b) Adjustments to Interest Payment Date and Maturity Date

If a Scheduled Rate Fixing Date (as defined below) is adjusted for an Unscheduled Holiday or if

a Valuation Postponement (as defined below) applies, then the Interest Payment Date or Maturity

Date relating to such Scheduled Rate Fixing Date shall be two Payment Business Days after the

date on which the Reference Rate for such Interest Payment Date or Maturity Date is determined.

If any Interest Payment Date or Maturity Date is adjusted in accordance with the preceding

sentence, then such adjustment (and the corresponding payment obligations to be made on such

dates) shall apply only to such Interest Payment Date or the Maturity Date, as applicable, and no

further adjustment shall apply to the amount of interest or principal payable and Noteholders will

not be entitled to any additional interest in respect of such adjustment.

(c) Applicable Price Source Fallback Provisions

If a Price Source Disruption Event occurs, the Calculation Agent shall apply each of the following

price source disruption fallbacks (each a “Price Source Disruption Fallback”) for the

determination of the Reference Rate in the following order, until the Reference Rate can be

determined:

(i) Valuation Postponement (as defined below);

(ii) Fallback Reference Price: SFEMC INR Indicative Survey Rate (INR 02);

(iii) Fallback Survey Valuation Postponement (as defined below); and

(iv) Appointment by the Issuer of an Independent Financial Institution (as defined below) to

determine the Reference Rate.

The Issuer shall agree any Reference Rate provided by the Calculation Agent, including the

process, methodology and source website in relation to any applicable Price Source Disruption

Fallback, and under no circumstances shall the Calculation Agent be liable to any person as a

result of the Calculation Agent having acted on any such quotations, or having taken or not taken

any action in relation to any applicable Price Source Disruption Fallback, which subsequently

may be found to be incorrect, or to have delayed the determination of the Reference Rate.

(d) Deferral Period for Unscheduled Holiday

If the Scheduled Rate Fixing Date is postponed due to the occurrence of an Unscheduled Holiday

(as defined below), and if the Rate Fixing Date has not occurred on or before the 14th calendar

day after the Scheduled Rate Fixing Date (any such period being a “Deferral Period”), then the

next day after the Deferral Period that would have been a Fixing Business Day but for the

Unscheduled Holiday, shall be deemed to be the Rate Fixing Date.

A39729228 102

(e) Interpretation

For the purposes of this Condition 6.9:

(i) “Cumulative Events” means, notwithstanding anything to the contrary, in no event shall

the total number of consecutive calendar days during which either (A) a valuation is

deferred due to an Unscheduled Holiday, or (B) a Valuation Postponement shall occur (or

any combination of (A) and (B)), exceed 14 consecutive calendar days in the aggregate.

Accordingly, (x) if, upon the lapse of any such 14 calendar day period, an Unscheduled

Holiday shall have occurred or be continuing on the day following such period that

otherwise would have been a Fixing Business Day, then such day shall be deemed to be a

Rate Fixing Date, and (y) if, upon the lapse of any such 14 calendar day period, a Price

Source Disruption Event shall have occurred or be continuing on the day following such

period on which the Reference Rate otherwise would be determined, then Valuation

Postponement shall not apply and the Reference Rate shall be determined in accordance

with the next applicable Price Source Disruption Fallback;

(ii) “Fallback Survey Valuation Postponement” means that, if the Fallback Reference Price

is not available on or before the third Fixing Business Day (or a day that would have been

a Fixing Business Day but for an Unscheduled Holiday) succeeding the end of either (A)

the Valuation Postponement in connection with a Price Source Disruption Event, (B) the

Deferral Period in connection with an Unscheduled Holiday or (C) any Cumulative

Events, as applicable, then the Reference Rate will be determined in accordance with the

next applicable Price Source Disruption Fallback on such day (which will be deemed to

be the applicable Rate Fixing Date). For the avoidance of doubt, Cumulative Events, if

applicable, do not preclude postponement of valuation in accordance with this provision;

(iii) “Fixing Business Day” means any day on which commercial banks and foreign exchange

markets settle payments and are open for general business (including dealings in foreign

exchange and foreign currency deposits) in Mumbai and London;

(iv) “Independent Financial Institution” means a leading bank or financial institution

selected and appointed by the Issuer at its own cost which is engaged in the interbank

market (or, if appropriate, money, swap or over-the-counter index options market) that is

most closely connected with the calculation or determination to be made by the

Calculation Agent to act as such in its place;

(v) “Maximum Days of Postponement” means 14 calendar days;

(vi) “Payment Business Day” means any day on which commercial banks and foreign

exchange markets settle payments and are open for general business (including dealings

in foreign exchange and foreign currency deposits) in New York, New Delhi, Mumbai and

London;

(vii) “Price Source Disruption Event” shall occur if, in the opinion of the Calculation Agent,

it becomes impossible to obtain the Reference Rate on a Rate Fixing Date;

(viii) “Rate Fixing Date” means the Scheduled Rate Fixing Date, subject to Valuation

Postponement. If the Scheduled Rate Fixing Date is an Unscheduled Holiday, the “Rate

Fixing Date” shall be the next following Fixing Business Day, subject to the provisions

relating to the Deferral Period for Unscheduled Holiday set out herein;

A39729228 103

(ix) “Reference Rate” means the rate, determined by the Calculation Agent, used on each Rate

Fixing Date which will be the USD/INR spot rate, expressed as the amount of Rupees per

one U.S. dollar, for settlement in two Fixing Business Days, reported by Financial

Benchmarks India Pvt Ltd. (“FBIL”), which is displayed on Reuters page “INRREF =

FBIL” (or any successor page) at approximately 1:30 pm, Mumbai time, on each Rate

Fixing Date. If a Price Source Disruption Event occurs on the Rate Fixing Date, then the

Reference Rate for such Rate Fixing Date shall be determined by the Calculation Agent

in accordance with the fallback provisions set out in Condition 6.9(c);

(x) “Scheduled Rate Fixing Date” means the date which is two Fixing Business Days prior

to the relevant Interest Payment Date, the Maturity Date or such other date on which an

amount in respect of the Notes is due and payable;

(xi) “SFEMC INR Indicative Survey Rate (INR02)” means that the Reference Rate for a

given Rate Fixing Date will be the INR/USD specified rate for U.S. Dollars, expressed as

the amount of Rupees per one U.S. dollar, for settlement in two Fixing Business Days, as

published on the web site of Singapore Foreign Exchange Market Committee (“SFEMC”)

at approximately 3:30 p.m. (Singapore time), or as soon thereafter as practicable, on such

date. The Reference Rate shall be calculated by SFEMC (or a service provider SFEMC

may select in its sole discretion) pursuant to the SFEMC INR Indicative Survey (as

defined below) for the purpose of determining the SFEMC INR Indicative Survey Rate;

(xii) “SFEMC INR Indicative Survey” means a methodology, dated as of 1 December 2004

as amended from time to time, for a centralised industry-wide survey of financial

institutions that are active participants in the INR/USD markets for the purpose of

determining the SFEMC INR Indicative Survey Rate (INR02);

(xiii) “Unscheduled Holiday” means a day that is not a Fixing Business Day and the market

was not aware of such fact (by means of a public announcement or by reference to other

publicly available information) until a time later than 9:00 a.m. local time in Mumbai, two

Fixing Business Days prior to the relevant Rate Fixing Date; and

(xiv) “Valuation Postponement” means that the Reference Rate will be determined on the

Fixing Business Day first succeeding the day on which the Price Source Disruption Event

ceases to exist, unless the Price Source Disruption Event continues to exist (measured

from the date that, but for the occurrence of the Price Source Disruption Event, would

have been the Rate Fixing Date) for a consecutive number of calendar days equal to the

Maximum Days of Postponement. In such event, the Reference Rate will be determined

on the next Fixing Business Day after the Maximum Days of Postponement (which will,

subject to the provisions relating to Fallback Survey Valuation Postponement, be deemed

to be the applicable Rate Fixing Date) in accordance with the next applicable Price Source

Disruption Fallback.

7 REDEMPTION AND PURCHASE

7.1 Redemption at maturity

Unless previously redeemed or purchased and cancelled as specified below, each Note (including each

Index Linked Redemption Note and Dual Currency Redemption Note) will be redeemed by the Issuer

at its Final Redemption Amount specified in, or determined in the manner specified in, the applicable

Pricing Supplement in the relevant Specified Currency on the Maturity Date.

A39729228 104

7.2 Redemption for tax reasons

The Notes may be redeemed at the option of the Issuer in whole, but not in part, at any time (if the Notes

are neither a Floating Rate Note, an Index Linked Interest Note, nor a Dual Currency Note) or on any

Interest Payment Date (if the Notes are either a Floating Rate Note, an Index Linked Interest Note or a

Dual Currency Interest Note), on giving not less than 30 nor more than 60 days’ notice to the Trustee

and the Principal Paying Agent in writing and, in accordance with Condition 14, to the Noteholders

(which notice shall be irrevocable), if the Issuer satisfies the Trustee immediately before the giving of

such notice that:

(a) on the occasion of the next payment due under the Notes, the Issuer has or will become obliged

to pay additional amounts as provided or referred to in Condition 8, or the Guarantor (where

relevant) would be required to pay such additional amounts, in each case, as a result of any change

in, or amendment to, the laws or regulations of a Relevant Jurisdiction (as defined in Condition

8.2(b)) or any change in the general application or official interpretation of the laws or regulations

of a Relevant Jurisdiction, which change or amendment becomes effective on or after the date on

which agreement is reached to issue the first Tranche of the Notes; and

(b) such obligation cannot be avoided by the Issuer or the Guarantor (where relevant) taking

reasonable measures available to it,

provided that no such notice of redemption shall be given earlier than 90 days prior to the earliest date

on which the Issuer or the Guarantor (where relevant) would be obliged to pay such additional amounts

were a payment in respect of the Notes then due.

Prior to the publication of any notice of redemption pursuant to this Condition 7, the Issuer shall deliver

to the Trustee and the Principal Paying Agent (i) a certificate in English signed by two Authorised

Signatories of the Issuer or of the Guarantor (where relevant) stating that the requirement referred to in

(a) above of this Condition 7.2 will apply on the next Interest Payment Date and cannot be avoided by

the Issuer or the Guarantor (where relevant) taking reasonable measures available to it, and (ii) an

opinion of independent legal advisers of recognised standing to the effect that the Issuer or the Guarantor

(where relevant) has or will become obliged to pay such additional amounts as a result of such change

or amendment, and the Trustee shall be entitled to accept such certificate and opinion as sufficient

evidence of the satisfaction of the conditions precedent set out in (a) and (b) above of this Condition 7.2,

in which event the same shall be conclusive and binding on the Noteholders, the Receiptholders and the

Couponholders.

Notes redeemed pursuant to this Condition 7.2 will be redeemed at their Early Redemption Amount

referred to in Condition 7.4 below together with interest (if any) accrued to (but excluding) the date of

redemption.

ECB Guidelines would require any Domestic Issuer to obtain the prior approval of the RBI or the

designated authorised dealer category I bank appointed in accordance with the ECB Guidelines, (the

“AD Bank”) as the case may be, before providing notice for or effecting such a redemption prior to the

Maturity Date and such approval may not be forthcoming.

7.3 Redemption upon Change of Control

Following the occurrence of a Change of Control, each Noteholder will have the right to require the

Issuer to redeem all, or some only, of the Notes held by such Noteholder on the Change of Control

Redemption Date at their nominal amount outstanding together with interest (including additional

amounts pursuant to Condition 8 if any), if any, accrued to (but excluding) the Change of Control

Redemption Date.

A39729228 105

To exercise such right to require redemption of any Notes, the holder of the Notes must deliver such

Notes at the specified office of any Paying Agent, in the case of Bearer Notes, or of any Transfer Agent

or the Registrar, in the case of Registered Notes, on any business day (being, in relation to any place, a

day (other than a Saturday or a Sunday) on which banks and foreign exchange markets are open for

business in that place) at the place of such specified office falling within the notice period, accompanied

by a duly signed and completed notice of exercise in the form (for the time being current and which may,

if this Note is held in a clearing system, be any form acceptable to the clearing system delivered in a

manner acceptable to the clearing system) obtainable from any specified office of any Paying Agent,

Transfer Agent or the Registrar (a “Change of Control Redemption Notice”) and in which the holder

must specify a bank account to which payment is to be made under this paragraph accompanied by such

Notes or evidence satisfactory to the relevant Paying Agent, Transfer Agent or the Registrar, as the case

may be, that such Notes will, following the delivery of the Change of Control Redemption Notice, be

held to its order or under its control.

Subject to the receipt of RBI or AD Bank approval, where required, the Issuer shall redeem any such

Notes the subject of the Change of Control Redemption Notices delivered on the Change of Control

Redemption Date.

A Change of Control Redemption Notice given by a holder of any Note shall be irrevocable and no Note

deposited with a Paying Agent, Transfer Agent or the Registrar pursuant to this Condition 7.3 may be

withdrawn without the prior written consent of the Issuer.

None of the Trustee or the Agents shall be required to take any steps to ascertain whether a Change of

Control or any event which could lead to the occurrence of a Change of Control has occurred and none

of them shall be liable to Noteholders, the Issuer, the Guarantor (where relevant) or any other person for

not doing so.

The Issuer, failing whom the Guarantor (where relevant), shall give notice to Noteholders in accordance

with Condition 14 and to the Trustee and the Principal Paying Agent in writing by not later than 15 days

following the first day on which it becomes aware of the occurrence of a Change of Control, which

notice shall specify the procedure for exercise by holders of their rights to require redemption of the

Notes pursuant to this Condition 7.3 and shall give brief details of the Change of Control.


A “Change of Control” will have occurred when:

(a) the Government of India ceases to own (directly or indirectly) the highest aggregate amount of

voting rights of the issued share capital of ONGC as the single largest shareholder, or a Person

or Persons, acting together, other than the Government of India, acquires Management Control

of ONGC; or

(b) (in the case of Guaranteed Notes) ONGC ceases to own (directly or indirectly) more than 50 per

cent. of the voting rights of the issued share capital of the Issuer, or a Person or Persons, acting

together, other than ONGC, acquires Management Control of the Issuer; or

(c) ONGC consolidates with or merges into or sells or transfers all or substantially all of the assets

of ONGC to any other Person, unless the consolidation or merger will not result in the

Government of India ceasing to own (directly or indirectly) the highest aggregate amount of

voting rights of the issued share capital of such Person as the single largest shareholder, or such

Person, other than the Government of India, acquiring Management Control of ONGC;

A39729228 106

“Change of Control Redemption Date” means the fourteenth day after the expiry of such period of 30

days after the later of a Change of Control or the date upon which notice of a Change of Control is given

to Noteholders by the Issuer in accordance with Condition 14 as referred to above;

“Management Control” means in respect of a Person, the possession, directly or indirectly, of the power

to appoint and/or remove all or a majority of the members of the board of directors of the Person or

otherwise directly or indirectly to control or have the power to control the affairs and policies of the

Person. In the context of (a) and (c) above of this definition, the Government of India shall be deemed

to retain Management Control if such Management Control is exercised through an entity in which the

Government of India has Management Control. In the context of (b) above of this definition, ONGC

shall be deemed to retain Management Control if such Management Control is exercised through an

entity of which ONGC has Management Control; and

“Person” includes any individual, company, corporation, firm, partnership, joint venture, undertaking,

association, organisation, trust, state or agency of a state (in each case whether or not being a separate

legal entity) but does not include the Issuer’s or the Guarantor’s (as relevant) board of directors or any

other governing board and does not include the Issuer’s or the Guarantor’s (as relevant) wholly-owned

direct or indirect subsidiaries.

ECB Guidelines, as amended from time to time, require any Domestic Issuer to obtain the prior approval

of the RBI or the AD Bank, as the case may be, before providing notice for or effecting such a redemption

prior to the Maturity Date and such approval may not be forthcoming.

7.4 Early Redemption Amounts

For the purpose of Conditions 7.2 and 7.3 above and Condition 10, each Note will be redeemed at its

Early Redemption Amount calculated as follows:

(a) in the case of a Note with a Final Redemption Amount equal to the Issue Price, at the Final

Redemption Amount thereof;

(b) in the case of a Note (other than a Zero Coupon Note but including an Instalment Note and Partly

Paid Note) with a Final Redemption Amount which is or may be less or greater than the Issue

Price or which is payable in a Specified Currency other than that in which the Note is

denominated, at the amount specified in, or determined in the manner specified in, the applicable

Pricing Supplement or, if no such amount or manner is so specified in the applicable Pricing

Supplement, at its nominal amount; or

(c) in the case of a Zero Coupon Note, at an amount (the “Amortised Face Amount”) calculated in

accordance with the following formula:

Early Redemption Amount = RP x (1+AY)y

where:

“RP” means the Reference Price;

“AY” means the Accrual Yield expressed as a decimal; and

“y” is the Day Count Fraction specified in the applicable Pricing Supplement which will be either

(i) 30/360 (in which case the numerator will be equal to the number of days (calculated on the

basis of a 360-day year consisting of 12 months of 30 days each) from (and including) the Issue

Date of the first Tranche of the Notes to (but excluding) the date fixed for redemption or (as the

case may be) the date upon which such Note becomes due and repayable and the denominator

will be 360) or (ii) Actual/360 (in which case the numerator will be equal to the actual number of

A39729228 107

days from (and including) the Issue Date of the first Tranche of the Notes to (but excluding) the

date fixed for redemption or (as the case may be) the date upon which such Note becomes due

and repayable and the denominator will be 360) or (iii) Actual/365 (in which case the numerator

will be equal to the actual number of days from (and including) the Issue Date of the first Tranche

of the Notes to (but excluding) the date fixed for redemption or (as the case may be) the date

upon which such Note becomes due and repayable and the denominator will be 365),

or on such other calculation basis as may be specified in the applicable Pricing Supplement.

7.5 Instalments

Instalment Notes will be redeemed in the Instalment Amounts and on the Instalment Dates. In the case

of early redemption, the Early Redemption Amount will be determined pursuant to Condition 7.4 above.

7.6 Partly Paid Notes

Partly Paid Notes will be redeemed, whether at maturity, early redemption or otherwise, in accordance

with the provisions of this Condition 7 and the applicable Pricing Supplement.

7.7 Purchases

The Issuer, the Guarantor (where relevant) or any Subsidiary may at any time purchase Notes (provided

that, in the case of definitive Bearer Notes, all unmatured Receipts, Coupons and Talons appertaining

thereto are purchased therewith) at any price in the open market or otherwise. Such Notes may be held,

reissued, resold or, at the option of the Issuer surrendered to any Paying Agent and/or the Registrar for

cancellation.

7.8 Cancellation

All Notes which are redeemed will forthwith be cancelled (together with all unmatured Receipts,

Coupons and Talons attached thereto or surrendered therewith at the time of redemption). All Notes so

cancelled and any Notes purchased and cancelled pursuant to Condition 7.7 above (together with all

unmatured Receipts, Coupons and Talons cancelled therewith) shall be forwarded to the Principal Paying

Agent (which shall notify the Registrar of such cancelled Notes in the case of Registered Notes) and

may not be reissued or resold.

7.9 Late payment on Zero Coupon Notes

If the amount payable in respect of any Zero Coupon Note upon redemption of such Zero Coupon Note

pursuant to Conditions 7.1, 7.2 or 7.3 above or upon its becoming due and repayable as provided in

Condition 10 is improperly withheld or refused, the amount due and repayable in respect of such Zero

Coupon Note shall be the amount calculated as provided in Condition 7.4(c) above as though the

references therein to the date fixed for the redemption or the date upon which such Zero Coupon Note

becomes due and payable were replaced by references to the date which is the earlier of:

(a) the date on which all amounts due in respect of such Zero Coupon Note have been paid; and

(b) five days after the date on which the full amount of the moneys payable in respect of such Zero

Coupon Note has been received by the Trustee or the Principal Paying Agent and notice to that

effect has been given to the Noteholders in accordance with Condition 14.

7.10 No verification by Trustee or Agents

Neither the Trustee nor any of the Agents shall be responsible for calculating or verifying the calculations

of any Early Redemption Amount or any other amount payable under any notice of redemption or

Change of Control Redemption Notice and none of them shall be liable to the Noteholders, the Issuer,

the Guarantor (where relevant) or any other person for not doing so.

A39729228 108

8 TAXATION

8.1 Payment without Withholding

All payments of principal and interest in respect of the Notes, Receipts and Coupons by the Issuer or the

Guarantor (where relevant) will be made without withholding or deduction for or on account of any

present or future taxes, duties, assessments or governmental charges of whatever nature (“Taxes”)

imposed or levied by or on behalf of any Relevant Jurisdiction unless such withholding or deduction of

Taxes is required by law. In such event, the Issuer or the Guarantor (where relevant) will pay such

additional amounts as shall be necessary in order that the net amounts received by the holders of the

Notes, Receipts or Coupons after such withholding or deduction shall equal the respective amounts

which would otherwise have been receivable in respect of the Notes, Receipts or Coupons, as the case

may be, in the absence of such withholding or deduction; except that no such additional amounts shall

be payable in relation to any payment with respect to any Note, Receipt or Coupon:

(a) presented for payment by or on behalf of a holder who is liable to the Taxes in respect of such

Note, Receipt or Coupon by reason of his having some connection with a Relevant Jurisdiction

other than the mere holding of such Note, Receipt or Coupon; or

(b) presented for payment by or on behalf of a holder of such Note, Receipt or Coupon who, at the

time of such presentation, is able to avoid such withholding or deduction by making a declaration

of non-residence or other similar claim for exemption and does not make such declaration or

claim; or

(c) presented for payment more than 30 days after the Relevant Date (as defined below) except to

the extent that a holder would have been entitled to additional amounts on presenting the same

for payment on the last day of the period of 30 days assuming (whether or not such is in fact the

case) that day to have been a Payment Day (as defined in Condition 6.6).

8.2 Interpretation

As used herein:

(a) “Relevant Date” means the date on which such payment first becomes due, except that, if the

full amount of the moneys payable has not been duly received by the Trustee or the Principal

Paying Agent or, as the case may be, the Registrar on or prior to such due date, it means the date

on which, the full amount of such moneys having been so received, notice to that effect is duly

given to the Noteholders in accordance with Condition 14; and

(b) “Relevant Jurisdiction” means the jurisdiction of incorporation of the Issuer, India or any

political subdivision or any authority thereof or therein having power to tax or any other

jurisdiction or any political subdivision or any authority thereof or therein having power to tax to

which the Issuer (or any substitute appointed pursuant to Condition 15) or the Guarantor (where

relevant) becomes subject in respect of payments made by it of principal and interest in respect

of the Notes, Receipts and Coupons.

In the circumstance that the Issuer is based in India any payments made by any Domestic Issuer (where

relevant), are required to be within the all-in-cost ceilings prescribed under the ECB Guidelines, and in

accordance with any specific approvals from the RBI or the AD Bank, as the case may be, obtained by

such Issuer (where relevant) in this regard.

8.3 No Responsibility on Trustee or Agents for determinations

Neither the Trustee nor any Agent shall be responsible for paying any tax, duty, charges, withholding or

other payment referred to in this Condition 8 or for determining whether such amounts are payable or

A39729228 109

the amount thereof, and none of them shall be responsible or liable for any failure by the Issuer, the

Guarantor (where relevant) or any Noteholder to pay such tax, duty, charges, withholding or other

payment.

9 PRESCRIPTION

The Notes (whether bearer or registered form), Receipts and Coupons will become void unless presented for

payment within a period of 10 years (in the case of principal) and five years (in the case of interest) after the

Relevant Date (as defined in Condition 8.2(a)) therefor.

There shall not be included in any Coupon sheet issued on exchange of a Talon any Coupon the claim for

payment in respect of which would be void pursuant to this Condition 9 or Condition 6.2 or any Talon which

would be void pursuant to Condition 6.2.

10 EVENTS OF DEFAULT AND ENFORCEMENT

10.1 Events of Default

The Trustee at its discretion may, and if so requested in writing by the holders of at least 25 per cent. in

aggregate nominal amount of the Notes then outstanding or if so directed by an Extraordinary Resolution

of the Noteholders shall (subject in each case to being indemnified and/or secured and/or prefunded to

its satisfaction), give notice to the Issuer and the Guarantor (where relevant) that the Notes are, and they

shall accordingly forthwith become (subject to receipt of prior RBI approval or AD Bank approval

pursuant to the ECB Guidelines or FEMA Guarantee Laws (as applicable), as the case may be),

immediately due and repayable at their nominal amount, together with accrued interest as provided in

the Trust Deed, in any of the following events (each an “Event of Default”):

(a) if a default is made in the payment of any principal or interest due in respect of the Notes or any

of them and the default continues for a period of three days in the case of principal or seven days

in the case of interest from the due date of such payment; or

(b) if the Issuer or the Guarantor (where relevant) fails to perform or observe any of its other

obligations under these Conditions or the Trust Deed and (except in any case where the Trustee

considers the failure to be incapable of remedy, when no continuation or notice as is hereinafter

mentioned will be required) the failure continues for the period of 30 days following the service

by the Trustee on the Issuer or the Guarantor (where relevant) of notice requiring the same to be

remedied; or

(c) if (i) any Indebtedness for Borrowed Money (as defined below) of the Issuer or the Guarantor

(where relevant) becomes capable of being declared due and repayable prematurely by reason of

an event of default (however described); (ii) the Issuer or the Guarantor (where relevant) fails to

make any payment in respect of any Indebtedness for Borrowed Money on the due date for

payment as extended by any applicable grace period originally provided for; (iii) any security

given by the Issuer or the Guarantor (where relevant) for any Indebtedness for Borrowed Money

becomes enforceable; or (iv) default is made by the Issuer or the Guarantor (where relevant) in

making any payment due under any guarantee and/or indemnity given by it in relation to any

Indebtedness for Borrowed Money of any other person; provided that no event described in this

Condition 10.1(c) shall constitute an Event of Default unless the relevant amount of Indebtedness

for Borrowed Money or other relative liability due and unpaid, either alone or when aggregated

(without duplication) with other amounts of Indebtedness for Borrowed Money and/or other

liabilities due and unpaid relative to all (if any) other events specified in (i) to (iv) inclusive above

A39729228 110

of this paragraph (c), amounts to at least U.S.$25,000,000 (or its equivalent in any other

currency); or

(d) if any order is made by any competent court or resolution is passed for the winding up or

dissolution of the Issuer or the Guarantor (where relevant), save for the purposes of

reorganisation, reconstruction, amalgamation, merger or consolidation on terms approved in

writing by the Trustee acting on an Extraordinary Resolution of the Noteholders; or

(e) if the Issuer or the Guarantor (where relevant) ceases or threatens to cease to carry on the whole

or a substantial part of its business, save for the purposes of reorganisation on terms previously

approved in writing by the Trustee or by an Extraordinary Resolution of the Noteholders, or the

Issuer or the Guarantor (where relevant) stops or threatens to stop payment of, or is unable to, or

admits inability to, pay its debts (or any class of its debts) as they fall due or is deemed unable to

pay its debts pursuant to or for the purposes of any applicable law, or is adjudicated by a court of

competent jurisdiction bankrupt or insolvent; or

(f) if (i) proceedings are initiated against the Issuer or the Guarantor (where relevant) under any

applicable liquidation, insolvency, composition, reorganisation or other similar laws or an

application is made (or documents filed with a court) for the appointment of an administrative or

other receiver, manager, administrator or other similar official, or an administrative or other

receiver, manager, administrator or other similar official is appointed, in relation to the Issuer or

the Guarantor (where relevant) or, as the case may be, in relation to the whole or any part of the

undertaking or assets of any of them or an encumbrancer takes possession of the whole or any

part of the undertaking or assets of any of them, or a distress, execution, attachment, sequestration

or other process is levied, enforced upon, sued out or put in force against the whole or any part

of the undertaking or assets of any of them, and (ii) in any such case (other than the appointment

of an administrator), the relevant proceedings or action is not discharged within 60 days; or

(g) if the Issuer or the Guarantor (where relevant) (or their respective directors or shareholders)

initiates or consents to judicial proceedings relating to itself under any applicable liquidation,

insolvency, composition, reorganisation or other similar laws (including the obtaining of a

moratorium) or makes a conveyance or assignment for the benefit of, or enters into any

composition or other arrangement with, its creditors generally (or any class of its creditors) or

any meeting is convened to consider a proposal for an arrangement or composition with its

creditors generally (or any class of its creditors); or

(h) if any government authority or agency condemns, seizes, compulsorily purchases or expropriates

all or any material part of the assets or shares of the Issuer or the Guarantor (where relevant)

without fair compensation, unless, and for so long as such compulsory purchase or expropriation

is being contested in good faith and by appropriate proceedings; or

(i) a moratorium (which expression shall not include any deferral of principal originally

contemplated and made in accordance with the terms of any loan or other financing related

agreement) is agreed or declared by the Issuer or the Guarantor (where relevant) in respect of any

Indebtedness for Borrowed Money (including any obligations arising under guarantees (where

relevant)) of the Issuer or the Guarantor, as the case may be; or

(j) if the Issuer or the Guarantor (where relevant) is or becomes entitled or subject to, or is declared

by law or otherwise to be protected by, immunity (sovereign or otherwise) and Condition 19.4 is

held to be invalid or unenforceable; or

A39729228 111

(k) it is or will become unlawful for the Issuer or the Guarantor (where relevant) to perform or

comply with any one or more of its material obligations under any of the Notes or the Trust Deed

of the Guarantee; or

(l) if any events occur which, under the laws of any Relevant Jurisdiction, has or may have, in the

Trustee’s opinion, an analogous effect to any of the events referred to in any of subparagraphs

(d) to (h) inclusive, (k) and (l) of this Condition 10.1.

10.2 Interpretation

For the purposes of this Condition 10, “Indebtedness for Borrowed Money” means any indebtedness

(whether being principal, interest or other amounts) for or in respect of any notes, bonds, debentures,

debenture stock, loan stock or other securities or any borrowed money or any liability under or in respect

of any acceptance or acceptance credit.

ECB Guidelines, as amended from time to time, require any Domestic Issuer (where relevant) to obtain

the prior approval of the RBI or the AD Bank, as the case may be, before effecting a redemption of Notes

prior to their stated maturity, even in case of an event of default and such approval may not be

forthcoming.

10.3 Enforcement

(a) The Trustee may at any time, at its discretion and without notice, take such proceedings and/or

other steps or action (including lodging an appeal in any proceedings) against or in relation to the

Issuer and/or the Guarantor (where relevant) as it may think fit to enforce the provisions of the

Trust Deed, the Agency Agreement, the Notes, the Receipts and/or the Coupons, but it shall not

be bound to take any such proceedings or any other steps or action in relation to the Trust Deed,

the Notes, the Receipts and/or the Coupons unless (i) it shall have been so directed by an

Extraordinary Resolution of the Noteholders or so requested in writing by the holders of at least

25 per cent. in aggregate nominal amount of the Notes then outstanding and (ii) it shall have been

indemnified and/or secured and/or pre-funded to its satisfaction.

(b) The Trustee may refrain from taking any action in any jurisdiction if the taking of such action in

the jurisdiction would, in its opinion, which may be based upon legal advice in the relevant

jurisdiction, be contrary to any law or regulation of that jurisdiction. Furthermore, the Trustee

may also refrain from taking such action if it would otherwise render it liable to any person in

that jurisdiction or if, in its opinion, which may be based upon legal advice in the relevant

jurisdiction, it would not have the power to do the relevant thing in that jurisdiction by virtue of

any applicable law or regulation in that jurisdiction or if it is determined by any court or other

competent authority in that jurisdiction that it does not have such power.

(c) No Noteholder, Receiptholder or Couponholder shall be entitled to proceed directly against (i)

the Issuer or the Guarantor (where relevant) to enforce the performance of any of the provisions

of the Trust Deed or the Notes, the Receipts and/or the Coupons or to take any other proceedings

and/or other steps or action (including lodging an appeal in any proceedings) in respect of or

concerning the Issuer or the Guarantor (where relevant), in each case unless the Trustee, having

become bound so to proceed, fails so to do within a reasonable period and the failure shall be

continuing or (ii) against any of the directors, officers, employees or Appointees (as defined in

the Trust Deed) of the Trustee.

A39729228 112

11 REPLACEMENT OF NOTES, RECEIPTS, COUPONS AND TALONS

Should any Note, Receipt, Coupon or Talon be lost, stolen, mutilated, defaced or destroyed, it may be replaced

subject to applicable laws, regulations and relevant stock exchange regulations at the specified office of the

Principal Paying Agent (in the case of Bearer Notes, Receipts or Coupons) or the Registrar (in the case of

Registered Notes) upon payment by the claimant of such costs and expenses as may be incurred in connection

therewith and on such terms as to evidence and indemnity and/or security as (a) the Issuer may reasonably

require or (b) the Principal Paying Agent or, as the case may be, the Registrar may require. Mutilated or defaced

Notes, Receipts, Coupons or Talons must be surrendered before replacements will be issued.

12 PAYING AGENTS, REGISTRAR AND TRANSFER AGENTS

The names of the initial Paying Agents, the initial Registrar and the initial Transfer Agents and their initial

specified offices are set out below.

The Issuer is entitled, after consultation with the Trustee, to vary or terminate the appointment of the Principal

Paying Agent, any other Paying Agent, the Registrar or any Transfer Agent and/or appoint additional or other

Paying Agents, Registrar or Transfer Agents, provided that:

(a) there will at all times be the Principal Paying Agent and, in the case of Registered Notes, a Registrar;

(b) so long as the Notes are listed on any stock exchange, there will at all times be a Paying Agent, which

may be the Principal Paying Agent, and a Transfer Agent with a specified office in such place as may be

required by the rules and regulations of the relevant stock exchange (or any other relevant authority);

(c) so long as the Notes are listed on the SGX-ST, if the Notes are issued in definitive form, there will at all

times be a Paying Agent in Singapore unless the Issuer obtains an exemption from the SGX-ST; and

(d) any replacement Agent or additional Agent is a bank of international reputation with experience of

performing the role and duties of the Agent which it is replacing (in the case of a replacement Agent) or

(in the case of an additional Agent) of a Paying Agent, a Transfer Agent, a Calculation Agent or a

Registrar (as applicable) appointed as such in respect of Notes denominated in the relevant currency(ies)

and cleared through the relevant clearing system(s).

In addition, the Issuer shall forthwith appoint a Paying Agent having a specified office in New York City in the

circumstances described in Condition 6.5. Notice of any variation, termination, appointment or change in

Paying Agents will be given promptly by the Issuer or the Guarantor (where relevant) to the Noteholders in

accordance with Condition 14 and clause 14(m) of the Trust Deed.

In acting under the Agency Agreement, the Paying Agents, the Registrar and the Transfer Agents act solely as

agents of the Issuer and the Guarantor (where relevant) and, in certain circumstances specified therein, of the

Trustee and do not assume any obligation to, or relationship of agency or trust with, any Noteholders,

Receiptholders or Couponholders. The Agency Agreement contains provisions permitting any entity into which

any Agent is merged or converted or with which it is consolidated or to which it transfers all or substantially all

of its assets to become the successor agent.

13 EXCHANGE OF TALONS

On and after the Interest Payment Date on which the final Coupon comprised in any Coupon sheet matures, the

Talon (if any) forming part of such Coupon sheet may be surrendered at the specified office of the Principal

Paying Agent or any other Paying Agent in exchange for a further Coupon sheet including (if such further

Coupon sheet does not include Coupons to (and including) the final date for the payment of interest due in

respect of the Note to which it appertains) a further Talon, subject to the provisions of Condition 9.

A39729228 113

14 NOTICES

Notices to holders of Registered Notes will be deemed to be validly given if sent by first class mail or (if posted

to an overseas address) by air mail to them at their respective addresses as recorded in the Register and will be

deemed to have been validly given on the fourth day after the date of such mailing and, in addition, for so long

as any Registered Notes are listed on a stock exchange or are admitted to trading by another relevant authority

and the rules of that stock exchange or relevant authority so require, the Issuer or the Guarantor (where relevant)

shall ensure that such notice will be published in a daily newspaper of general circulation in the place or places

required by those rules.

All notices regarding the Bearer Notes will be deemed to be validly given if published in a leading daily

newspaper of general circulation in Asia or such other English language daily newspaper with general

circulation in Asia as the Trustee may in its discretion approve. It is expected that such publication will be made

in the Asian Wall Street Journal. The Issuer shall also ensure that notices are duly published in a manner which

complies with the rules and regulations of any stock exchange (or any other relevant authority) on which the

Notes are for the time being listed. Any such notice will be deemed to have been given on the date of the first

publication or, where required to be published in more than one newspaper, on the date of the first publication

in all required newspapers. If publication as provided above is not practicable, a notice will be given in such

other manner, and will be deemed to have been given on such date, as the Trustee may in its discretion approve.

Until such time as any definitive Notes are issued, there may, so long as any Global Notes representing the

Notes are held in their entirety on behalf of Euroclear and/or Clearstream, Luxembourg, be substituted for such

publication in such newspaper(s) or such mailing the delivery of the relevant notice to Euroclear and/or

Clearstream, Luxembourg for communication by them to the holders of the Notes and, in addition, for so long

as any Notes are listed on a stock exchange and the rules of that stock exchange (or any other relevant authority)

so require, the Issuer or the Guarantor (where relevant) shall ensure that such notice will be published in a daily

newspaper of general circulation in the place or places required by the rules of that stock exchange (or any other

relevant authority). Any such notice shall be deemed to have been given to the holders of the Notes on the first

day after the day on which the said notice was given to Euroclear and/or Clearstream, Luxembourg.

Notices to be given by any Noteholder shall be in writing and given by lodging the same, together (in the case

of any Note in definitive form) with the relative Note or Notes, with the Principal Paying Agent (in the case of

Bearer Notes) or the Registrar (in the case of Registered Notes). Whilst any of the Notes are represented by a

Global Note, such notice may be given by any holder of a Note to the Principal Paying Agent or the Registrar

through Euroclear and/or Clearstream, Luxembourg, as the case may be, in such manner as the Principal Paying

Agent, the Registrar and Euroclear and/or Clearstream, Luxembourg, as the case may be, may approve for this

purpose.

Receiptholders and Couponholders will be deemed for all purposes to have notice of the contents of any notice

given to Noteholders in accordance with this Condition 14.

15 MEETINGS OF NOTEHOLDERS, MODIFICATION, WAIVER AND SUBSTITUTION

The Trust Deed contains provisions for convening meetings of the Noteholders to consider any matter affecting

their interests, including without limitation the sanctioning by Extraordinary Resolution of a modification of

the Notes, the Receipts, the Coupons or any of the provisions of the Trust Deed. Such a meeting may be

convened by the Issuer, the Guarantor (where relevant) or the Trustee and shall be convened by the Trustee if

requested in writing in English by Noteholders holding not less than 10 per cent. in nominal amount of the

Notes for the time being outstanding and subject to the Trustee being indemnified and/or secured and/or pre-

funded to its satisfaction against all costs and expenses. The quorum at any such meeting for passing an

Extraordinary Resolution is one or more persons holding or representing not less than 50 per cent. in nominal

A39729228 114

amount of the Notes for the time being outstanding, or at any adjourned meeting one or more persons being or

representing Noteholders whatever the nominal amount of the Notes so held or represented, except that at any

meeting the business of which includes the modification of certain provisions of the Notes, the Receipts, the

Coupons or the Trust Deed (including, inter alia, modifying the date of maturity of the Notes or any date for

payment of interest thereon, reducing or cancelling the amount of principal or the rate of interest payable in

respect of the Notes or altering the currency of payment of the Notes, the Receipts or the Coupons), the quorum

shall be one or more persons holding or representing not less than two-thirds in nominal amount of the Notes

for the time being outstanding, or at any adjourned such meeting one or more persons holding or representing

not less than one-third in nominal amount of the Notes for the time being outstanding. An Extraordinary

Resolution passed at any meeting of the Noteholders shall be binding on all the Noteholders, whether or not

they are present at the meeting, and on all Receiptholders and Couponholders.

The Trustee (a) may agree, without the consent of the Noteholders, Receiptholders or Couponholders, to any

modification of, or to the waiver or authorisation of any breach or proposed breach of, any of the provisions of

these Conditions or the Trust Deed or the Agency Agreement (except as mentioned in the Trust Deed), or

determine, without any such consent as aforesaid, that any Event of Default or Potential Event of Default (as

defined in the Trust Deed) shall not be treated as such, where, in any such case, it is not, in the opinion of the

Trustee, materially prejudicial to the interests of the Noteholders so to do or (b) may agree, without any such

consent as aforesaid, to any modification which, in its opinion, is of a formal, minor or technical nature or to

correct a manifest error or to comply with mandatory provisions of law. Any such modification, waiver or

authorisation shall be binding on the Noteholders, the Receiptholders and the Couponholders and shall be

notified by the Issuer and the Guarantor (where relevant) to the Noteholders in accordance with Condition 14

as soon as practicable thereafter.

In connection with the exercise by it of any of its trusts, powers, authorities and discretions (including, without

limitation, any modification, waiver, authorisation, determination or substitution), the Trustee shall have regard

to the general interests of the Noteholders as a class but shall not have regard to any interests arising from

circumstances particular to individual Noteholders, Receiptholders or Couponholders (whatever their number)

and, in particular but without limitation, shall not have regard to the consequences of any such exercise for

individual Noteholders, Receiptholders or Couponholders (whatever their number) resulting from their being

for any purpose domiciled or resident in, or otherwise connected with, or subject to the jurisdiction of, any

particular territory or any political sub-division thereof, and the Trustee shall not be entitled to require on behalf

of any Noteholder, Receiptholder or Couponholder, nor shall any Noteholder, Receiptholder or Couponholder

be entitled to claim, from the Issuer, the Guarantor (where relevant), the Trustee or any other person any

indemnification or payment in respect of any tax consequences of any such exercise upon individual

Noteholders, Receiptholders or Couponholders except to the extent already provided for in Condition 8 and/or

any undertaking or covenant given in addition to, or in substitution for, Condition 8 pursuant to the Trust Deed.

The Trustee may (but shall not be obliged to), without the consent of the Noteholders, agree with the Issuer and

the Guarantor (where relevant) to the substitution in place of the Issuer (or of any previous substitute under this

Condition 15 and clause 21 of the Trust Deed) as the principal debtor under the Notes, the Receipts, the Coupons

and the Trust Deed of any Subsidiary of ONGC (such substituted company being the “New Company”),

provided that a supplemental trust deed is executed or some other form of undertaking is given by the New

Company in form and manner satisfactory to the Trustee, agreeing to be bound by the provisions of the Trust

Deed with any consequential amendments which the Trustee may deem appropriate as fully as if the New

Company had been named in the Trust Deed as the principal debtor in place of the Issuer (or of the previous

substitute under this Condition 15 and clause 21 of the Trust Deed) and provided further that (except where the

New Company is ONGC) ONGC unconditionally and irrevocably guarantees all amounts payable under these

presents to the satisfaction of the Trustee, subject to (i) the Trustee being satisfied that the interests of the

A39729228 115

Noteholders will not be materially prejudiced by the substitution and (ii) certain other conditions set out in the

Trust Deed being complied with.

Any such substitution shall be binding on the Noteholders, the Receiptholders and the Couponholders and,

unless the Trustee otherwise agrees, any such modification or substitution shall be promptly notified to

Noteholders by the New Company in accordance with Condition 14 and the relevant provisions of the Trust

Deed.

16 INDEMNIFICATION OF THE TRUSTEE AND TRUSTEE CONTRACTING WITH THE

ISSUER AND WHERE APPLICABLE, THE GUARANTOR

The Trust Deed contains provisions for the indemnification of the Trustee and for its relief from responsibility

and liability towards the Issuer, the Guarantor (where relevant) and the Noteholders, including (a) provisions

relieving it from taking action unless indemnified and/or secured and/or pre-funded to its satisfaction and (b)

provisions limiting or excluding its liability in certain circumstances.

The Trust Deed provides that, when determining whether an indemnity or any security or pre-funding is

satisfactory to it, the Trustee shall be entitled (i) to evaluate its risk in any given circumstance by considering

the worst-case scenario and (ii) to require that any indemnity or security or pre-funding given to it by the

Noteholders or any of them or any other person be given on a joint and several basis and be supported by

evidence satisfactory to the Trustee as to the financial standing and creditworthiness of each counterparty and/or

as to the value of the security and an opinion as to the capacity, power and authority of each counterparty and/or

the validity and effectiveness of the security.

The Trust Deed also contains provisions pursuant to which the Trustee is entitled, inter alia, (A) to enter into

business transactions with the Issuer, the Guarantor (where relevant) or any person or body corporate related to

or associated with (directly or indirectly) any of their respective Subsidiaries and to act as trustee for the holders

of any other securities issued or guaranteed by, or relating to, the Issuer or the Guarantor (where relevant) or

any of their respective Subsidiaries, (B) to exercise and enforce its rights, comply with its obligations and

perform its duties under or in relation to any such transactions or, as the case may be, any such trusteeship

without regard to the interests of, or consequences for, the Noteholders, Receiptholders or Couponholders and

(C) to retain and not be liable to account for any profit made or any other amount or benefit received thereby

or in connection therewith.

Repatriation of proceeds outside India by the Issuer and/or the Guarantor (where relevant) under an indemnity

clause may require the prior approval of the RBI or such other governmental or regulatory body under

applicable law.

17 FURTHER ISSUES

The Issuer may from time to time without the consent of the Noteholders, the Receiptholders or the

Couponholders create and issue further notes having terms and conditions the same as the Notes or the same in

all respects save for the issue date, the amount and date of the first payment of interest thereon and so that the

same shall be consolidated and form a single Series with the outstanding Notes.

18 CONTRACTS (RIGHTS OF THIRD PARTIES) ACT 1999

No rights are conferred on any person under the Contracts (Rights of Third Parties) Act 1999 to enforce any

term of this Note, but this does not affect any right or remedy of any person which exists or is available apart

from that Act and is without prejudice to the rights of the Noteholders as set out in Condition 10.3(c).

A39729228 116

19 GOVERNING LAW AND SUBMISSION TO JURISDICTION

19.1 Governing law

The Trust Deed, the Agency Agreement, the Notes, the Receipts, the Coupons and any non-contractual

obligations arising out of or in connection with the Trust Deed, the Agency Agreement, the Notes, the

Receipts and the Coupons are governed by, and shall be construed in accordance with, English law.

19.2 Submission to jurisdiction

(a) Subject to Condition 19.2(c) below, the English courts have exclusive jurisdiction to settle any

dispute arising out of or in connection with the Trust Deed, the Notes, the Receipts and/or

Coupons, including any dispute as to their existence, validity, interpretation, performance, breach

or termination or the consequences of their nullity and any dispute relating to any non-contractual

obligations arising out of or in connection with the Trust Deed, the Notes, the Receipts and/or the

Coupons (a “Dispute”) and accordingly the Issuer and Guarantor submits to the exclusive

jurisdiction of the English courts.

(b) For the purposes of this Condition 19.2, each of the Issuer and the Guarantor (where relevant)

waives any objection to the English courts on the grounds that they are an inconvenient or

inappropriate forum to settle any Dispute.

(c) To the extent allowed by law, the Trustee, the Noteholders, the Receiptholders and the

Couponholders may, in respect of any Dispute or Disputes, take (i) proceedings in any other court

with jurisdiction; and (ii) concurrent proceedings in any number of jurisdictions.

19.3 Appointment of Process Agent

Each of the Issuer and the Guarantor irrevocably appoints Law Debenture Corporate Services Limited

at its registered office at Fifth Floor, 100 Wood Street, London EC2V 7EX, as its agent for service of

process in any proceedings before the English courts in relation to any Dispute, and agrees that, in the

event of such agent ceasing to be able or willing for any reason so to act, it will immediately appoint

another person as its agent for service of process in England in respect of any Dispute and will notify

the Trustee of such replacement process agent within 30 days of such cessation. The Issuer and the

Guarantor agrees that failure by a process agent to notify it of any process will not invalidate service.

Nothing herein shall affect the right to serve process in any other manner permitted by law.

19.4 Waiver of Immunity

To the fullest extent permitted by law, the Issuer and the Guarantor irrevocably and unconditionally:

(a) submits to the jurisdiction of the English courts in relation to any Dispute and waives and agrees

not to claim any sovereign or other immunity from the jurisdiction of the English courts in relation

to any Dispute (including to the extent that such immunity may be attributed to it), and agrees to

ensure that no such claim is made on its behalf;

(b) submits to the jurisdiction of the English courts and the courts of any other jurisdiction in relation

to the recognition of any judgment or order of the English courts or the courts of any other

jurisdiction in relation to any Dispute and waives and agrees not to claim any sovereign or other

immunity from the jurisdiction of the English courts or the courts of any other jurisdiction in

relation to the recognition of any such judgment or court order and agrees to ensure that no such

claim is made on its behalf; and

(c) consents to the enforcement of any order or judgment made or given in connection with any

Dispute and the giving of any relief in the English courts and the courts of any other jurisdiction

A39729228 117

whether before or after final judgment including, without limitation: (i) relief by way of interim

or final injunction or order for specific performance or recovery of any property; (ii) attachment

of its assets; and (iii) enforcement or execution against any property, revenues or other assets

whatsoever (irrespective of their use or intended use) and waives and agrees not to claim any

sovereign or other immunity from the jurisdiction of the English courts or the courts of any other

jurisdiction in relation to such enforcement and the giving of such relief (including to the extent

that such immunity may be attributed to it), and agrees to ensure that no such claim is made on

its behalf.

A39729228 118

USE OF PROCEEDS

The net proceeds from each issue of Notes will be applied by the relevant Issuer for the purposes of

meeting capital expenditure, refinancing, working capital purposes, general corporate purposes or any other

purposes permitted in accordance with applicable laws and regulations applicable to the relevant Issuer

including but not limited to the ECB Guidelines or the FEMA Guarantee Laws, or as permitted by RBI, and as

may be set forth in the applicable Pricing Supplement applicable to such Notes.

A39729228 119

CAPITALISATION AND INDEBTEDNESS OF THE COMPANY

The table below sets forth the consolidated capitalisation and indebtedness of the Company as of 31

March 2019. This table should be read in conjunction with the Company’s audited consolidated financial

statements for the year ended 31 March 2019 and the related notes thereto included elsewhere in this Offering

Circular.

As at 31 March 2019

Actual

(Rs. millions)

(U.S.$

millions)(2)

(audited) (unaudited)

Non-current liabilities:

Financial liabilities

(i) Borrowings ...................................................................................................... 531,440.58 7,682.96

(ii) Others .............................................................................................................. 8,352.68 120.75

Provisions ......................................................................................................................... 278,498.63 4,026.22

Deferred tax liabilities (Net) ............................................................................................ 473,667.98 6,847.75

Other non-current liabilities .............................................................................................. 12.275.15 177.46

Total (A) .......................................................................................................................... 1,304,235.02 18,855.14

Current liabilities:


(i) Borrowings ...................................................................................................... 489,623.02 7,078.41

(ii) Trade Payables

- to Micro and Small Enterprises ............................................................... 4,366.33 63.12

- to Others .................................................................................................. 320,408.66 4,632.11

(iii) Others ............................................................................................................... 351,489.99 5,081.44

Other current liabilities ..................................................................................................... 69,182.09 1,000.16

Provisions ......................................................................................................................... 43,192.33 624.43

Current Tax Liabilities (net) ............................................................................................ 12,053.34 174.25

Total (B) ........................................................................................................................... 1,290,315.76 18,653.91

TOTAL INDEBTEDNESS (C)=(A+B) .......................................................................... 2,594,550.78 37,509.05

EQUITY

Equity

Equity share capital .......................................................................................................... 62,901.54 909.36

Other equity ...................................................................................................................... 2,118,506.08 30,626.95

Equity attributable to owners of the Company (D) ...................................................... 2,181,407.62 31,536.31

Non-controlling interests (E) ............................................................................................ 181,062.10 2,617.59

TOTAL EQUITY (F)=(D)+(E) ...................................................................................... 2,362,469.72 34,153.90

A39729228 120

As at 31 March 2019

Actual

(Rs. millions)

(U.S.$

millions)(2)

(audited) (unaudited)

TOTAL CAPITALISATION(1) (G)=(F)+(C) ................................................................ 4,957,020.50 71,662.96

Note:

(1) Total capitalisation equals total indebtedness plus total equity.

(2) For the reader’s convenience, U.S. dollar translations of Indian Rupee amounts have been provided at a rate of

U.S.$1.00 = Rs. 69.1713, which was the RBI Reference Rate as of 31 March 2019.

On 13 August 2019, the Company published its unaudited and reviewed consolidated financial statements for

the three months ended 30 June 2019 and its unaudited and reviewed non-consolidated financial statements for

the three months ended 30 June 2019. Accordingly, the table above should be read in conjunction with the

Company’s unaudited and reviewed consolidated financial statements for the three months ended 30 June 2019

and the sections entitled “Presentation of financial and other information”, “Investment Considerations—Risks

Relating to the Company’s Business — Changes in accounting standards may impact the Company’s financial

condition.” and “Business – Recent Developments”.

A39729228 121

SELECTED FINANCIAL INFORMATION AND OTHER DATA

The selected consolidated financial information of the Company as of and for the years ended 31 March

2017, 2018 and 2019 have been derived from the Company’s audited consolidated financial statements for the

years ended 31 March 2018 and 2019 which are included elsewhere in this Offering Circular. This information

should be read in conjunction with, and is qualified in its entirety by reference to, the Company’s audited

consolidated financial statements for the years ended 31 March 2018 and 2019 and the related notes thereto.

The Company’s financial statements are prepared under IND-AS.

The Company’s audited consolidated financial statements as of and for the years ended 31 March 2018

were audited by Lodha & Co, Chartered Accountants, MKPS & Associates, Chartered Accountants,

Khandelwal Jain & Co., Chartered Accountants, K.C. Mehta & Co., Chartered Accountants, PKF Sridhar &

Santhanam LLP, Chartered Accountants and Dass Gupta & Associates, Chartered Accountants. The Company’s

audited consolidated financial statements as of and for the years ended 31 March 2019 were audited by K.C.

Mehta & Co., Chartered Accountants, PKF Sridhar & Santhanam LLP, Chartered Accountants, Dass Gupta &

Associates, Chartered Accountants, MKPS & Associates, Chartered Accountants, G M Kapadia & Co,

Chartered Accountants and R Gopal & Associates, Chartered Accountants.

Consolidated Statement of Profit and Loss

Fiscal Year

2017 2018 2019 2019

(Rs. millions) (Rs. millions) (Rs. millions) (U.S.$ millions)(1)

(audited) (audited) (audited) (unaudited)

REVENUE

Revenue from operations 3,256,662.21 3,622,464.32 4,534,605.67 65,556.17

Other Income .................................................. 93,231.74 74,681.34 81,487.64 1,178.06

Total Income ................................................... 3,349,893.95 3,697,145.66 4,616,093.31 66,734.23

EXPENSES

Purchase of stock-in-trade............................... 1,041,982.65 1,216,893.99 1,653,422.35 23,903.30

Changes in inventories of finished goods,

stock-in-trade and work-in progress ................ (47,846.87) (81.65) (30,947.30) (447.40)

Production, Transportation, Selling and

Distribution Expenditure ................................. 1,678,941.51 1,746,282.94 2,057,184.99 29,740.44

Exploration Costs written off

- Survey Costs ................................................. 19,019.31 15,968.02 19,607.03 283.46

- Exploratory Wells Costs ............................... 33,176.24 58,652.40 72,599.48 1,049.56

Financing Costs .............................................. 35,911.08 49,990.43 58,367.25 843.81

Depreciation, Depletion, Amortisation and

Impairment...................................................... 202,192.01 231,119.05 240,262.17 3,473.44

Other impairment and write offs 3,352.64 15,858.02 16,298.39 235.62

Total Expense ................................................ 2,966,728.57 3,334,683.20 4,086,794.36 59,082.23

Profit before exceptional items and tax ...... 383,165.38 362,462.46 529,298.95 7,652.00

Exceptional Items .......................................... 5,910.13 2,481.22 (15,910.10) (230.01)

Share of profit of Associates .......................... 20,452.92 27,254.97 29,542.70 427.09

Share of profit of Joint Ventures .................... 7,646.98 (123.63) 4,739.85 68.52

A39729228 122

Fiscal Year

2017 2018 2019 2019



Profit before tax ........................................... 417,175.41 392,075.02 547,671.40 7,917.60

Tax Expense

- Current tax ................................................... 88,083.23 104,765.69 159,120.56 2,300.38

- Earlier Years ................................................ (5,986.42) (3,984.69) (381.20) (5.51)

- Deferred Tax ............................................... 43,387.41 30,614.16 50,062.75 723.75

Total tax expense .......................................... 125,484.22 131,395.16 208,802.11 3,018.62

PROFIT FOR THE YEAR ......................... 291,691.19 260,679.86 338,869.29 4,898.98

Other comprehensive income

A (i) Items that will not be reclassified to

profit or loss

(a) Remeasurement of the defined benefit

plans............................................................... (4,903.83) (426.01) (4,372.15) (63.21)

- Deferred Tax ............................................... 1,697.27 175.96 1,529.70 22.11

(b) Equity instruments through other

comprehensive income .................................. 1,37,914.82 (17829.25) (17,108.07) (247.33)

- Deferred Tax ............................................... — (13313.50) 1.265.25 18.29

(c) Share of other comprehensive income in

associates and joint ventures, to the extent not

to be reclassified to profit or loss ................... (5.93) 2.42 (18.74) (0.27)

- Deferred Tax ............................................... (0.46) (0.51) (0.04) (0.00)

(d) Effective portion of gains (losses) on

hedging instruments in cash flow hedges ....... — — 0.24 0.00

B (i) Items that will be reclassified to profit or

loss

(a) Exchange differences in translating the

financial statement of foreign operation ......... 3,359.49 (687.26) 14,553.76 210.40

- Deferred Tax ............................................... (991.37) 350.23 (4,815.26) (69.61)

(b) Share of other comprehensive income in

associates and joint ventures, to the extent that

may be reclassified to profit or loss ............... —

Total other comprehensive income ............. 1,37,069.99 (31727.92) (8,965.31) (129.62)

Total Comprehensive Income ..................... 428,761.18 228,951.94 329,903.98 4,769.36

Attributable to:

Owners of the Company ............................... 244,192.50 221,059.28 304,949.61 4,408.61

Non-controlling interest ................................. 47,498.69 39,620.58 33,919.68 490.37

2,91,691.19 2,60,679,86 338,869.29 4,898.98

Other comprehensive income for the year

- Owners of the Company .............................. 1,36,282.51 (31,913.61) (8,531.02) (123.34)

- Non-controlling interests ............................. 787.48 185.69 (434.29) (6.28)

1,37,069.99 (31,727.92) (8,965.31) (129.62)

A39729228 123

Fiscal Year

2017 2018 2019 2019



Total comprehensive income for the year ......

- Owners of the Company .............................. 380,475.01 189,145.67 296,418.59 4,285.27

- Non-controlling interests ............................. 48,286.17 39,806.27 33,485.39 484.09

428,761.18 228,951.94 329,903.98 4,769.36

Earning per equity share

Basic .............................................................. 19.03 17.23 23.81 0.34

Diluted ........................................................... 19.03 17.23 23.81 0.34

Note:

(1) For the reader’s convenience, U.S. dollar translations of Indian Rupee amounts have been provided at a rate of U.S.$1.00

= Rs. 69.1713, which was the RBI Reference Rate as of 31 March 2019.

A39729228 124

Consolidated Balance Sheet

As of 31 March

2017 2018 2019 2019



EQUITY AND LIABILITIES

Equity

Equity share capital ......................................... 64,166.32 64,166.32 62,901.54 909.36

Other equity .................................................... 1,879,685.92 1,976,023.04 2,118,506.08 30,626.95

Non-controlling interests ................................. 132,919.64 156,059.97 181,062.10 2,617.59

Equity Total (A) .............................................. 2,076,771.88 2,196,249.33 2,362,469.72 34,153.90

Non-current liabilities


(i) Borrowings ........................................ 527,723.45 550,248.98 531,440.58 7,682.96

(ii) Others ................................................ 2,321.15 7,310.02 8,352.68 120.75

Provisions ....................................................... 231,146.30 252,001.50 278,498.63 4,026.22

Deferred tax liabilities (net) ............................ 367,629.79 415,059.44 473,667.98 6,847.75

Other non-current liabilities ............................ 8,089.30 11,822.99 12,275.15 177.46

Current liabilities


(i) Borrowings ........................................ 216,274.39 462,211.54 489,623.02 7,078.41

(ii) Trade payables ................................... 240,137.87 264,847.35 324,774.99 4,695.23

(iii) Others ................................................ 661,556.85 322,356.43 351,489.99 5,081.44

Other current liabilities ................................... 63,861.63 66,658.57 69,182.09 1,000.16

Provisions ....................................................... 49,511.98 44,099.14 43,192.33 624.43

Current Tax Liabilities (net) ........................... 8,950.19 9,484.06 12,053.34 174.25

Liability Total (B) ......................................... 2,377,202.90 2,406,100.03 2,594,550.78 37,509.06

GRAND TOTAL (C)=(A)+(B) ..................... 4,453,974.78 4,602,349.35 4,957,020.50 71,662.96

Note:

(1) For the reader’s convenience, U.S. dollar translations of Indian Rupee amounts have been provided at a rate of U.S.$1.00 = Rs.

69.1713, which was the RBI Reference Rate as of 31 March 2019.

A39729228 125

As of 31 March

2017 2018 2019 2019



ASSETS

Non-current assets

Property, plant and equipment

(i) Oil and gas assets .............................. 1,296,151.60 1,430,877.68 1,466,001.65 21,193.78

(ii) Other property, plant and equipment . 667,449.12 681,340.56 715,008.53 10,336.78

Capital work-in-progress

(i) Oil and gas assets ...........................

(a) Development Wells in

progress.................................. 40,286.78 26,519.03 43,837.48 633.75

(b) Oil and gas facilities in

progress.................................. 114,723.70 118,891.88 132,308.54 1,912.77

(ii) Others ............................................ 58,722.37 68,402.53 122,814.97 1,775.52

Goodwill (including Goodwill on

Consolidation) ................................................ 141,903.66 142,025.46 140,883.53 2,036.73

Investment Property ....................................... 0.79 78.74 78.73 1.14

Other intangible assets .................................... 5,749.11 6,254.38 6,768.44 97.85

Intangible assets under development

(i) Exploratory Wells in progress ....... 227,254.71 242,627.21 217,905.35 3,150.23

(ii) Acquisition cost ............................. 149,437.22 158,678.05 173,698.05 2,511.13

Financial assets

(i) Investments in:

(a) Joint Ventures and Associates 304,195.15 322,687.65 330,513.33 4,778.19

(b) Other Investments .................. 315,830.86 300,664.62 287,760.68 4,160.12

(ii) Trade receivables .......................... 13,630.08 16,564.13 20,572.16 297.41

(iii) Loans............................................. 21,545.86 20,911.25 28,498.92 412.00

(iv) Deposits under site restoration

fund ............................................... 145,942.72 160,639.59 181,884.30 2,629.48

(v) Others ............................................ 9,391.84 11,629.29 17,510.40 253.15

Deferred tax assets (net) ................................. 15,458.12 16,989.89 17,310.58 250.26

Non-current tax assets (net) ............................ 98,720.28 108,313.73 105,213.16 1,521.05

Other non-current assets ................................. 35,356.51 43,964.00 47,693.44 689.50

Current assets

Inventories ...................................................... 298,817.31 305,571.21 351,806.57 5,086.02

Financial assets

(i) Investments ................................... 87,430.68 49,993.82 50,837.67 734.95

(ii) Trade receivables .......................... 125,471.21 138,991.67 153,960.97 2,225.79

(iii) Cash and cash equivalents ............. 18,150.17 25,120.88 41,058.73 593.58

A39729228 126

As of 31 March

2017 2018 2019 2019



(iv) Other bank balances ...................... 113,976.20 25,507.53 9,975.45 144.21

(v) Loans............................................. 9,927.09 12,583.00 17,020.94 246.07

(vi) Others ............................................ 110,016.30 142,436.37 194,779.07 2,815.89

Current Tax Assets (net) ................................. - 283.88 1,524.30 22.04

Other current assets ........................................ 28,275.73 23,724.43 78,515.90 1,135.08

Assets classified as held for sale ..................... 159.61 76.89 1,278.66 18.49

TOTAL .......................................................... 4,453,974.78 4,602,349.35 4,957,020.50 71,662.96

Note:

(2) For the reader’s convenience, U.S. dollar translations of Indian Rupee amounts have been provided at a rate of U.S.$1.00 = Rs.

69.1713, which was the RBI Reference Rate as of 31 March 2019.

A39729228 127

OVERVIEW OF THE OIL INDUSTRY OF INDIA

The information set forth in this section is based on publicly available information from the BP Statistical

Review of World Energy (published in June 2009, 2010, 2011, 2012, 2013, 2014, 2015, 2016, 2017, 2018 and

2019), the United States Energy Information Administration (“EIA”), the Organisation for Economic Co-

operation and Development (“OECD”), the Directorate General of Hydrocarbons (“DGH”) and the

Petroleum Planning & Analysis Cell (“PPAC”) of the MoPNG, unless stated otherwise. These data have not

been independently verified by either the Guarantor or the Issuer. Note that DGH, the MoPNG and other

independent sources provide their data in metric tons and cubic feet; for convenience the Company has

converted such data from metric tons to barrels, using a conversion factor of 1 metric ton per 7.33 barrels and

converted from cubic feet to cubic meters using a conversion factor of 1 cubic metre per 35.3146 cubic feet. All

the absolute numbers are rounded off and percentages are calculated based on the actual numbers.

Overview of the Indian Economy

India is the world’s largest democracy with a population of 1.30 billion, according to the CIA Factbook, July

2018. According to OECD, India had an estimated GDP (in purchasing power parity terms) of approximately

U.S.$8,692 billion in 2018. India’s GDP has grown at an average rate of 7.14 per cent. over the last three years

(from 2015 to 2018). India is expected to record a compound annual growth rate (“CAGR”) in GDP of 6.4 per

cent. during 2018-2030.

GDP in Purchasing Power Parity terms (at 2010 prices)

2018 2020 2025 2030

CAGR

2018-2030

(U.S.$ billions)

World .............................................................. 95,823 103,037 119,708 137,451 3.05%

Organisation for Economic Cooperation and

Development (OECD) countries ..................... 51,508 53,748 58,579 64,194 1.85%

Non OECD countries ...................................... 44,316 49,289 61,129 73,258 4.28%

China .............................................................. 22,173 24,896 30,924 36,693 4.29%

India ................................................................ 8,692 10,074 13,898 18,244 6.37%

India’s economic growth has led to primary energy consumption growth at a CAGR of 5.46 per cent. from 2015

to 2018. Although, India’s energy needs are projected to increase at a rapid rate in the coming decades, domestic

energy resources are limited.

The Energy Scenario

India is the world’s third largest consumer of energy, behind China, and the United States with a consumption

of 5,931 million barrels of oil equivalent (“MMboe”) in 2018.

Top 10 primary energy consuming countries

Year Ended 31 December (MMboe) 2013 2014 2015 2016 2017 2018

China ........................................................ 21,312 21,804 22,061 22,335 23,009 23,994

US ............................................................ 16,185 16,367 16,223 16,219 16,291 16,864

India ......................................................... 4,578 4,893 5,056 5,272 5,498 5,931

A39729228 128

Year Ended 31 December (MMboe) 2013 2014 2015 2016 2017 2018

Russia ....................................................... 5,024 5,045 4,950 5,062 5,089 5,283

Japan ........................................................ 3,462 3,374 3,323 3,304 3,337 3,329

Canada ...................................................... 2,470 2,505 2,485 2,479 2,519 2,525

Germany ................................................... 2,418 2,319 2,364 2,405 2,448 2,374

South Korea .............................................. 2,028 2,049 2,091 2,142 2,178 2,206

Brazil ........................................................ 2,143 2,195 2,169 2,122 2,154 2,181

Note:

According to the BP Statistical Review of World Energy, primary energy comprises commercially traded fuels, including modern

renewables used to generate electricity. Coal has been the dominant fuel in the Indian energy sector, representing 55.89 per

cent. of total primary energy consumption in 2018. Oil’s share of India’s energy mix has remained relatively stable,

representing 29.54 per cent. of the total primary energy consumption in 2018. In India, crude oil and natural gas contributed

approximately 35.72 per cent. of the total energy consumption in 2018, which is low as compared to global standards

where oil and gas contributed approximately 57.49 per cent. of the total energy consumption. According to BP Energy

Outlook, domestic oil consumption is expected to grow at a CAGR of 3.1 per cent. during 2017 to 2040. Gas is currently

a minor fuel in the overall energy mix in India; however, domestic gas consumption is expected to grow at a CAGR of

5.5 per cent. during the same period.

Primary energy consumption - Energy sources

Domestic consumption

Year Ended 31 December

Total

domestic

primary

energy

consumption

(MMboe)

Energy sources (per cent. of total domestic consumption)

Coal Crude Oil Natural Gas Hydroelectric Others

2009 ........................................................................ 3,518 52.22% 31.46% 9.56% 5.00% 1.75%

2010 ........................................................................ 3,815 52.03% 30.01% 10.70% 4.80% 2.46%

2011 ........................................................................ 3,920 50.60% 30.48% 10.28% 5.57% 3.09%

2012 ........................................................................ 4,202 52.73% 30.28% 9.23% 4.57% 3.21%

2013 ........................................................................ 4,366 54.44% 29.43% 7.77% 5.00% 3.36%

2014 ........................................................................ 4,883 58.35% 27.14% 6.84% 4.44% 3.21%

2015 ........................................................................ 5,022 57.88% 28.59% 6.01% 4.40% 3.12%

2016 ........................................................................ 5,295 56.16% 30.05% 6.05% 4.02% 3.72%

2017 ........................................................................ 5,498 55.45% 30.28% 6.16% 4.09% 4.02%

2018 ........................................................................ 5,931 55.89% 29.54% 6.17% 3.91% 4.49%

Worldwide consumption


Total

Worldwide

primary

energy

consumption

(MMboe)

Energy sources (per cent. of total worldwide consumption)


2009 ........................................................................ 83,292 29.09% 34.40% 23.42% 6.48% 6.61%

2010 ........................................................................ 87,797 29.49% 33.66% 23.74% 6.50% 6.61%

2011 ........................................................................ 89,609 29.68% 33.39% 23.84% 6.50% 6.59%

2012 ........................................................................ 91,502 29.83% 33.16% 23.92% 6.68% 6.41%

2013 ........................................................................ 93,876 30.19% 32.63% 23.84% 6.73% 6.61%

A39729228 129


Total

Worldwide

primary

energy

consumption

(MMboe)

Energy sources (per cent. of total worldwide consumption)


2014 ........................................................................ 95,441 30.04% 32.65% 23.67% 6.79% 6.85%

2015 ........................................................................ 96,060 28.88% 33.12% 24.01% 6.74% 7.24%

2016 ........................................................................ 97,185 27.95% 34.37% 23.18% 6.89% 7.61%

2017 ........................................................................ 98,769 27.60% 34.19% 23.32% 6.83% 8.07%

2018 ........................................................................ 101,630 27.21% 33.62% 23.87% 6.84% 8.46%

Note:

Others include Nuclear energy and renewable energy. Primary energy comprises commercially traded fuels only.

India produced 68.12 per cent. of its domestic coal consumption, 16.85 per cent. of its domestic oil consumption

and 47.33 per cent of its domestic gas consumption in 2018. The remainder of India’s consumption was sourced

from imports.

Over the past ten years, domestic natural gas consumption has grown significantly in absolute terms, from

approximately 49.1 BCM for the year ended 31 December 2009 to approximately 58.1 BCM for the year ended

31 December 2018, representing a CAGR of approximately 1.89 per cent. Natural gas consumption as a

percentage of total domestic energy consumption was 6.17 per cent. for the year ended 31 December 2018. This

proportion remains well below the world average of 23.87 per cent. for the same period.

The consumption of petroleum products has grown from 1,010 million barrels (“MMbbl”) for the year ended

31 March 2010 to 1,551 MMbbl, for the year ended 31 March 2019 representing a CAGR of approximately

4.88 per cent.

Evolution of the Oil and Gas Sector

The Indian oil and gas industry trace its beginnings to the initial discoveries of crude oil in October 1889 in

Digboi, Assam in the far northeast region of India by the Assam Railway and Trading Company. The industry

saw modest growth in exploration, development and production activity for the next century. Following

independence, driven by the strategic significance of oil and gas industry for industrial development as well as

defence, the Indian Government made accelerated development of the oil and gas sector a major priority. In the

1950s, the Government entered the oil and gas sector by establishing the Oil and Natural Gas Directorate (the

predecessor to the Guarantor) in 1955, creating state-owned refinery companies (Indian Refineries Limited in

1958 and Indian Oil Company Limited in 1959, which were merged in 1964 to form the IOCL), and forming

exploration and development joint ventures with existing domestic and foreign oil and gas companies (OIL)

with the Burma Oil Company and the Assam Oil Company, and Indo-Stanvac Petroleum Company Limited, a

joint venture between the Government and Standard Vacuum Oil Company). The industry increased in size in

the 1960s and became increasingly dominated by state-owned entities and joint ventures between the

Government and private oil and gas companies.

In the 1970s, the Government implemented nationalisation policies, taking over the operations of companies

such as IBP Co. Limited, Esso, Caltex and Burmah-Shell. Following nationalisation, only state-owned

enterprises could participate in the oil and gas industry (other than Castrol, which was permitted to remain in

the niche lubricant segment). Virtually all aspects of the oil and gas industry were highly regulated, including

investment, exploration, production, distribution and pricing of all petroleum products sold in the market. In

A39729228 130

1974, the Guarantor discovered the large Mumbai High offshore oil field, prompting the large-scale expansion

in the Indian oil and gas sector. The Guarantor carried out its development programs and commenced oil

production from Mumbai High North in 1976 and Mumbai High South in 1980.

In the 1990s, as India’s reliance on oil imports increased, the Government embarked on a series of reforms

aimed at reducing India’s dependence on imports, deregulating the industry, improving efficiency and

encouraging private and foreign investment. Measures included opening the refining segment to private

investment, permitting the sale of limited amounts of LPG and kerosene by private entities outside of the state-

owned distribution channels, and allowing foreign oil companies to enter the domestic lubricant market.

From 1991 to 1997, the Government employed a series of auctioning rounds, which allowed for 100 per cent.

foreign direct investment in the exploration and production sector in India. These are now popularly referred to

as the “Pre-NELP rounds”. During the Pre-NELP rounds, the Government entered into production sharing

contracts on a case-to-case basis as there was no notified policy or framework pursuant to which the

Government granted acreages.

Under the Industrial Policy prevailing at the time, exploration blocks were offered for exploration and

production only to national oil companies. Private companies had access to hydrocarbon resources prior to

NELP only through joint venture arrangements entered with the Government, instead of complete participation

through a bidding process. These joint venture arrangements contemplated mandatory participation of the

Government through the national oil companies.

The Government offered acreages for exploration in various rounds including in the years 1980, 1982, 1986,

1991 and 1995. In 1986, the Government extended the offering of oil and gas acreages to private or international

investors apart from entering into nomination production sharing contracts with national oil companies on an

ad-hoc basis. 28 Exploration blocks were awarded to private companies during the year 1980 to 1995 and prior

to implementation of NELP. The Government further liberalised the petroleum exploitation and exploration

policy in 1991 inviting discovered fields for joint or independent development to national oil companies as well

as to private or international investors, on a competitive bidding basis under the policy as it existed in 1991.

Production Sharing Contracts (PSCs) awarded during 1991-1993 had the distinctive feature of operators as

private companies with the Company / OIL as having participating interest. These rounds received

overwhelming response from various private E&P operators. The Indian Government has signed 28 contracts

(One PSC for Panna Mukta–PM) for 29 discovered fields under Pre-NELP Discovered (Small and Medium size

fields) regime.

During 1997-1998, the Government formulated a comprehensive policy for inviting investments by nationalised

and private participants in the sector. The policy was notified in February 1999 as the “New Exploration

Licensing Policy” or NELP. Under the NELP, participants were offered exploration blocks for carrying out E&P

activities in India. Companies would bid for the minimum work commitment for each phase of exploration,

indicating in their bids the share of profit petroleum expected by them at various levels of returns, based on

either multiple of investment recovered or on post-tax rates of return. The companies winning the blocks would

enter PSCs with the Government. The thrust of NELP was to ensure a level playing field between the national

oil companies and the private participants. Under the first round of NELP bidding, the Government invited bids

for 48 blocks for exploration of oil and natural gas. To date, the Indian Government has signed PSCs for 28

discovered blocks and 28 exploration blocks under the pre-NELP regime and 254 blocks during the nine rounds

of NELP. Of the 310 blocks awarded, 125 blocks/fields are operational. Additionally, 33 coal bed methane

blocks have been awarded during four rounds of bidding.

NELP VIII was launched in April 2009 and was closed in October 2009. The Government offered 70 blocks,

the highest number of exploration blocks ever offered under NELP. Total area of these blocks was about 0.163

million sq. km. and offered blocks comprise of 24 deep water, 28 shallow water and 18 onshore. Government

A39729228 131

awarded 32 blocks in this NELP round and the Guarantor and its partners won 17 of the blocks. In this round,

the Government introduced several changes to the bidding process and the PSC contract to enhance

transparency and consistency.

The ninth and latest round of NELP (“NELP IX”) launched on 15 Oct 2010. The Indian Government launched

NELP IX in October 2010. 34 blocks covering an area of about 88,807 sq. km. were offered. The offered blocks

included - eight deep-water blocks, seven shallow water blocks and 19 on land blocks. To date, 19 PSCs have

been signed for blocks offered under NELP IX.

As of Mar 2016, the Union Cabinet approved the Hydrocarbon Exploration and Licensing Policy (“HELP”).

Under this policy, (1) there will be a single uniform license to enable E&P operators to explore and extract

conventional and unconventional oil and gas resources, including CBM, shale gas/oil, tight gas, and gas

hydrates; (2) companies will be allowed to place bids for blocks not already covered by exploration throughout

the year by submitting an initial Expression of Interest under the Open Acreage Licensing Policy (“OALP”),

and where if suitable for award, the Government will call for competitive bids, enabling a faster coverage of

the available geographical area. To implement this policy, DGH created the National Data Repository; (3) the

current fiscal regime of production sharing based on Pre-Tax Investment Multiple and cost recovery and

production-linked payments will be replaced by a revenue sharing model; 4) Lower royalty rates for areas with

higher risk and costs (i.e. offshore areas) with a graded system where royalty rates decreases from shallow water

to deep-water to ultra-deep water. The MoPNG, through DGH, is taking initiatives to identify, characterise and

prioritise the Indian sedimentary basins for focused shale oil/gas exploitation and also to assess and establish

the potential of fields. A Memorandum of understanding was signed between the United States Department of

State and the MoPNG in November 2010 on the assessment of shale gas resources in India, training, assistance

in regulatory frameworks and investment promotion.

DGH has initiated steps to identify prospective hydrocarbon resources for exploration. Substantial geo-

scientific data have been generated over the years through exploration and production activities during the Pre-

NELP and NELP phases. The Government had constituted a Multi Organization team with this data to re-assess

the hydrocarbon resources of all the sedimentary basins of India for prospectivity, assisting in the future

planning of exploration activities. This study has now been completed. India’s cabinet in 2018 allowed oil and

gas producers to explore for shale oil and gas and CBM under the existing contracts, a move aimed at unlocking

the unconventional hydrocarbon potential of the country.

Domestic gas price reforms

In June 2013, the Indian Government gave its approval for the fixation of price of domestic natural gas

according to the recommendations of the committee constituted under the chairmanship of Dr. C. Rangarajan

on production sharing contract mechanisms in the petroleum industry. As per the Rangarajan committee, gas

prices would be fixed based on the average of the net back price of Indian gas imports and the weighted average

of gas prices at certain international hubs. The underlying principle is that Indian producers should receive a

similar price to what the gas producers elsewhere receive.

The approved policy derives from global trade transactions of gas, the competitive price of gas at the global

level by combining two methods. First, the netback price of Indian liquefied natural gas term imports (excluding

spot imports) at the wellhead of the exporting countries will be estimated. Such a netback weighted average

price will be interpreted as the arm’s length competitive price applicable for India. The second method of

searching for a competitive price for India will be to take the weighted average of pricing prevailing at the hubs

or balancing points of certain major markets, namely (a) the hub price at the Henry Hub in the US (for North

America), (b) the price at the National Balancing Point of the UK (for Europe), and (c) the netback price at the

sources of supply for Japan. Finally, the simple average of the prices arrived at through the two methods will

be taken. Such an overall average of global prices, derived based on netback and hub/balancing point principles,

A39729228 132

will be taken as the economically appropriate estimate of the arm’s length competitive prices applicable for

India.

These approved recommendations, known as the Natural Gas Pricing Guidelines 2013, were to be made

applicable since 1 April 2014 to all domestically produced gas and will remain valid for five years. However,

in view of the Lok Sabha elections in India, in terms of the directives of the Election Commission, aforesaid

Pricing Guidelines for domestically produced gas notified on 10.01.2014 was deferred till the Code of Conduct

is lifted.

Subsequently, in Aug’14, another Committee was constituted to undertake comprehensive re-examination of

the issue of gas pricing and based on Committee’s recommendations, Govt. notified “New Domestic Natural

Gas Pricing Guidelines, 2014” on 25 October 2014 and made it applicable from 01 November 2014. In terms

of these guidelines, domestic gas price effective from 01 November 2014 is determined based on weighted

average formula considering (a) annual average prices prevailing at Henry Hub, Alberta Hub, National

Balancing Point (“NBP”) & Russia and (b) annual volume of natural gas consumed in USA & Mexico, Canada,

European Union (“EU”) & Former Soviet Union (“FSU”) countries, excluding Russia.

On 10 October 2014, the same was notified with a revision cycle of every six months based on the prevailing

hub prices; the US-based Henry Hub, Canada-based Alberta gas, the UK-based NBP, and Russian gas. These

guidelines are applicable to all gas produced from nomination fields given to Company and OIL, NELP blocks

and such Pre-NELP blocks where PSC provides for Government approval of gas prices.

However, the guidelines are not applicable to gas for which prices have been fixed contractually for a certain

period of time until the end of such period. These guidelines are also not applicable where the contract provides

a specific formula for natural gas price indexation/fixation and such Pre-NELP blocks where Government

approval has not been provided under the PSC.

Further, the Government has decided to offer a premium on gas produced from Deep water, Ultra-deep water,

and High-Pressure High-Temperature (“HPHT”) areas. The MoPNG vide letter dated 21 Mar’16 notified the

Marketing including pricing freedom (subject to a ceiling price based on landed price of alternative fuels) for

the gas to be produced from Discoveries in Deepwater, Ultra Deepwater, and High Pressure-High Temperature

areas.

In addition to above, Government vide Notification dated 11.04.17 has also allowed Mktg. and Pricing freedom

in respect of CBM gas.

Deregulation in domestic prices of petroleum products

Consequent upon deregulation of petroleum sector, initially it was decided that the price of indigenous crude

oil produced by the Company and OIL will be market determined w.e.f. Apr’02. However, in view of steep

increase in oil price, Government decided to modulate the retail selling price (“RSP”) of Domestic LPG and

SKO PDS during 2003-04. As a result, public sector oil marketing companies (“OMCs”) began to incur under-

recoveries on sale of these products. Subsequently, during 2003-04, MoPNG vide its letter dated 30th Oct’03

issued a mechanism for sharing the under-recoveries of OMCs which continued till the first quarter of 2015-

16.

Meanwhile over a period, Government has taken significant financial measures to reduce the burden of total

under-recoveries:

1. Government had deregulated price of Petrol (MS) in Jun’10 and Diesel (HSD) for bulk consumers in

Jan’13.

A39729228 133

2. Govt. has also capped the no. of subsidized cylinders to the consumers. During 2014-15, Government

has launched Direct Benefits Transfer for LPG (DBTL) Consumers Scheme for transfer of LPG subsidy

directly into bank account of the consumers.

3. During 2014-15, effective from 19 Oct’14, Government discontinued subsidizing diesel and deregulated

its price for retail consumers also.

4. Government has also increased consumer prices of LPG (Domestic) and PDS Kerosene to reduce/

eliminate under-recoveries.

5. During 2017-18, effective from 15th June 2017 it was decided that consumer price of Petrol (MS) and

Diesel (HSD) to be revised on daily basis. Effective 1 January 2015, the Direct Benefit Transfer Scheme

(PAHAL) was launched where subsidies on domestic LPG were to only be provided to eligible

consumers. Subsequently on 28 December 2015, the Government clarified that LPG subsidies will not

be available to consumers if the consumer and his/her spouse had a taxable income of more than Rs.

1,000,000 in the previous financial year.

6. Rationalization of PDS Kerosene quota over the years to reduce subsidy.

Further, effective from FY’15, crude oil price started moving southward. Lower crude pricing regime coupled

with aforesaid fiscal measures taken by Govt. have resulted into considerable reduction in total under-recoveries

of OMCs. Thus, effective from Q2 2015-16 onwards, upstream oil companies including Company have not

been asked to share under-recoveries of OMCs.

Oil and Natural Gas Production and Consumption

In India, domestic production of oil and gas lags domestic consumption of oil and gas, which results in reliance

on imports. Domestic production deficit of crude oil and natural gas has increased at a CAGR of 8.41 per cent.

and 11.49 per cent., respectively, during 2013-2018.

The following table sets forth the total domestic production and consumption of crude oil and natural gas for

calendar years 2009 through 2018.

Calendar Year

Oil Production

('000 barrels

per day)

Oil

Consumption

('000 barrels

per day) Deficit

Deficit

(per cent.)

2009 ..................................................................... 838 3,300 2,462 74.61%

2010 ..................................................................... 901 3,381 2,480 73.35%

2011 ..................................................................... 937 3,550 2,613 73.61%

2012 ..................................................................... 926 3,747 2,821 75.29%

2013 ..................................................................... 926 3,789 2,863 75.56%

2014 ..................................................................... 905 3,914 3,009 76.88%

2015 ..................................................................... 893 4,245 3,352 79.86%

2016 ..................................................................... 874 4,654 3,780 81.22%

2017 ..................................................................... 884 4,870 3,986 81.85%

2018 ..................................................................... 869 5,156 4,287 83.15%

A39729228 134

Calendar Year

Gas

Production

(BCM)

Gas

Consumption

(BCM) Deficit

Deficit (per

cent.)

2009 ..................................................................... 36.1 49.1 13.0 26.48%

2010 ..................................................................... 47.4 59.0 11.6 19.66%

2011 ..................................................................... 42.9 60.3 17.4 28.86%

2012 ..................................................................... 37.3 55.7 18.4 33.03%

2013 ..................................................................... 31.1 49.0 17.9 36.53%

2014 ..................................................................... 29.4 48.5 19.1 39.38%

2015 ..................................................................... 28.1 47.8 19.7 41.21%

2016 ..................................................................... 26.6 50.8 24.2 47.64%

2017 ..................................................................... 27.7 53.7 26.0 48.42%

2018 ..................................................................... 27.5 58.1 30.6 52.67%

Note:

Oil consumption comprises inland demand, international aviation, marine bunkers, refinery fuel and loss, Fuel ethanol and biodiesel.

The Company and OIL together (both majority controlled by Government) have a share of approximately 71.8

per cent. in India’s production of crude oil and approximately 80.6 per cent. in India’s production of natural

gas. Although deregulation and other government initiatives, such as the introduction of NELP rounds, have

increased the level of private sector participation in the domestic production sector, the two Government-

controlled entities still are the largest players in the industry.

The remainder of the domestic crude oil and gas production comes primarily from public sector/private sector

joint ventures. Significant private-sector participants in India’s hydrocarbon production joint ventures include

RIL, and smaller state-owned enterprises such as GSPC.

The following table provides a breakdown of India’s major producers of crude oil and natural gas as of 1 April

2018:

Producer

Crude oil

(MMbbl) (per cent.)

Natural gas

(BCM) (per cent.)

ONGC ................................................................. 163.1 62.34% 23.4 71.76%

OIL ...................................................................... 24.8 9.47% 2.9 8.83%

Pvt/JV .................................................................. 73.7 28.19% 5.6 17.16%

Sub-Total ............................................................ 261.6 100.00% 31.9 97.75%

CBM .................................................................... - - 0.7 2.25%

Total ................................................................... 261.6 100.00% 32.6 100.00%

During fiscal year 2017 - 2018, the total production of oil and gas in India was 261.61 MMbbl and 32.65 BCM

respectively. The contribution of private sector and joint venture companies to total India’s oil and gas

production has increased from 18.50 per cent. for fiscal 2006 to 27.80 per cent. for fiscal year 2018.

A39729228 135

India’s consumption for oil is expected to grow at an average annual growth rate of 3.0 per cent. between 2017

and 2030 compared, with China’s expected average annual oil consumption growth rate of 1.3 per cent. In

contrast, global growth rate is expected to be 0.5 per cent.

Global oil consumption (MMbbl/day) 2017-2030

2017 2020 2025 2030

CAGR

2017-2030

India ................................................................ 4.7 5.2 6.0 6.9 3.01%

China .............................................................. 12.7 13.8 14.7 15.1 1.33%

World .............................................................. 95.8 99.0 101.7 102.6 0.53%

India is expected to record an average annual growth of 6.0 per cent. in the consumption of natural gas between

2017 and 2030, compared with a global growth rate of 1.9 per cent.

Global natural gas consumption (BCM) 2017-2030

2017 2020 2025 2030

CAGR

2017-2030

India ................................................................ 54 66 88 115 6.0%

China .............................................................. 240 309 409 504 5.9%

World .............................................................. 3,670 3,933 4,345 4,700 1.9%

As per statistics published by the MoPNG, India’s net imports in Fiscal year 2017 – 2018 was 1,535 MMbbl

and import value stood at Rs. 4,776.98 billion.

Given the substantial gap between supply and demand in the energy sector in India and the limited amount of

crude oil and natural gas reserves globally, the Government has increasingly focused its attention on alternate

hydrocarbon extraction technologies such as coal bed methane, shale gas, oil shale, underground coal

gasification and gas hydrates.

Exploration

As of 1 April 2018, India’s ultimate reserves are estimated by DGH to be around 30.81 billion barrels of oil and

oil equivalent gas. During fiscal year 2017-2018, accretion of in-place reserves and ultimate reserves are

estimated to be approximately of 1.76 billion barrels and 0.80 billion barrels of oil and oil equivalent gas,

respectively.

The following table provides a breakdown of India’s reserves by company as of 1 April 2018:

Company

Initial in-place

reserves

(bn boe) (per cent.)

Ultimate

reserves

(bn boe) (per cent.)

ONGC .......................................................... 52.9 65.81% 19.7 63.82%

OIL .............................................................. 8.4 10.40% 3.2 10.47%

Pvt/JV .......................................................... 19.1 23.79% 7.9 25.71%

Total ............................................................ 80.4 100.00% 30.8 100.00%

A39729228 136

Domestic proved reserves of crude oil have slightly decreased over the 10-year period ended 31 December

2018, from 5.80 billion barrels to 4.48 billion barrels. Domestic gas reserves have increased over the same

period, from 1.05 trillion cubic meters to 1.29 trillion cubic meters. India accounts for 0.3 per cent. and 0.7 per

cent. of global oil and gas proved reserves, respectively in 2018.

There have been discoveries of oil and gas both in the offshore and onshore basins of India, with 18 hydrocarbon

discoveries (12 Oil and 6 Natural Gas) made in 2017-2018. So far, 242 discoveries (127 Oil and 115 Natural

Gas) have been made under the NELP regime.

Sedimentary basins

India covers an area of approximately 3,365,449 sq. km. in 26 sedimentary basins divided into three categories

based on degree of prospectivity as shown below:

Basin Category Nature

No. of

Basins

Onshore and

Offshore Areas

(square

kilometres) Basins

Category I ....................

Established

commercial

production 7 998,325

Cambay, Assam Shelf,

Mumbai offshore, Krishna-

Godavari, Cauvery, Assam-

Arakan Fold Belt, Rajasthan

Category II ...................

Known

accumulation of

hydrocarbons, but no

commercial

production as yet 5 780,974

Saurashtra, Kutch,

Vindhyan, Mahanadi,

Andaman

Category III .................

Indicated

hydrocarbon shows

that are considered

geologically

prospective 14 1,586,150

Kerala-Konan, Bengal-

Purnea, Ganga-Punjab,

Pranhita-Godavari, Satpura-

South Rewa-Damodar,

Himalayan Foreland,

Chhattisgarh, Narmada,

Spiti-Zankskar, Deccan

Syneclise, Cuddapah,

Karewa, Bhima-Kaladgi,

Baster

Total ............................ 26 3,365,449

Exploration activity

Domestic exploration and development activity were historically highly regulated, with work being exclusively

undertaken by two national oil companies, the Company and OIL. Given that exploration and development

activities are very capital intensive and that historically only two national oil companies were engaged in the

business, the sector received a low level of investment.

Exploration activities have increased with the entry of new participants, and significant steps have been taken

in exploring the hydrocarbon potential of the sedimentary basins of India. There was a total of 144 exploratory

wells drilled in fiscal year 2017 – 2018, an increase from 141 exploratory wells in fiscal year 2016 – 2017.

A39729228 137

Number of Wells (#)

Exploratory Wells Drilled 2016-17 2017-18

Onshore Offshore Total Onshore Offshore Total

ONGC ................................................... 52 31 83 57 45 102

OIL ....................................................... 19 0 19 11 0 11

Pvt/JV ................................................... 30 09 39 17 14 31

Total ..................................................... 101 40 141 85 59 144

PPT: HK-#20341379

Exploration licenses

The Company accounts for 73.8 per cent. of the total domestic territory licensed for exploration. The following

table below sets forth the company wise PEL as of 1 April 2018:

Company/Operator PEL area at 1 April 2018

(Sq. km.) (per cent.)

ONGC .......................................................................................................... 67,169 73.8%

Focus ............................................................................................................ 6,789 7.5%

OIL ............................................................................................................... 4,475 4.9%

CAIRN ......................................................................................................... 1,988 2.2%

RIL ............................................................................................................... 1,787 2.0%

GSPC............................................................................................................ 1,787 2.0%

Nayara .......................................................................................................... 1,685 1.9%

Jubilant ......................................................................................................... 1,260 1.4%

Others(1) ........................................................................................................ 4,092 4.5%

Total ............................................................................................................. 91,032 100.0%

Note:

Others include HOEC, Adani Welspun, Deep Energy, SINTEX Oil and Gas, IOCL, OMKAR Natural, Mercator

Petroleum, BPRL, Jay Polychem (India) Limited (“JPIL”), Sankalp Oil, Pratibha Oil and Pan India

To carry out exploration and exploitation of oil and gas resources, a company has to first apply to the

Government, followed by the respective state governments of India for grant of a PEL in accordance with the

PNG Rules. Upon receipt of requisite approvals/consents as applicable, the state government then grants a PEL.

Under HELP, the exploration phase for onshore areas was increased from 7 to 8 years, and for offshore areas

was increased from 8 to 10 years. Upon grant of the PEL and in the event the PEL is prospective, the area can

apply for the grant of a mining lease to the Government and the respective state governments of India in

accordance with the PNG Rules. A mining lease is typically issued for a period of 20 years.

A39729228 138

Leased domestic production area

The Company and OIL hold the largest portion of leased acreage for oil and natural gas production, accounting

collectively for approximately 86.58 per cent. of the total territory leased by the Government for commercial

production of crude oil and natural gas as of 1 April 2018. The following table sets forth the amount of domestic

production area granted to lessees under petroleum mining leases under operation in the PSC regime as of 1

April 2018:

Company/Operator Mining lease area

(Sq. km.) (per cent.)

ONGC .......................................................................................................... 55,691 79.44%

OIL ............................................................................................................... 5,006 7.14%

CAIRN ......................................................................................................... 3,757 5.36%

BG-RIL-ONGC ............................................................................................ 2,678 3.82%

RIL ............................................................................................................... 1,148 1.64%

Others(1) ........................................................................................................ 1,821 2.60%

Total ............................................................................................................. 70,101 100.00%

Note:

(1) Others include ONGC (Cambay), GEOENPRO, ACIL, HOEC, Sun-Petrochemical Pvt Ltd., JTI, NIKO, SELAN,

GNRL, Hydrocarbon-Resdev PPC, OILEX, GSPCL, Focus, HARDY, Nayara

Crude Oil and Natural Gas Transportation

Crude oil produced onshore is primarily transported to refineries through trunk pipelines, with a small

percentage transported by road tankers. Crude oil produced offshore is transported by trunk pipelines to onshore

facilities for processing and then supplied through pipelines and marine tankers to refiners, with a small

percentage transported by ships directly from offshore. There are approximately 10,400 km. of crude pipelines

in India, which the Guarantor, GSPL, IOCL and other companies in the private sector operate. The Guarantor

and IOCL are the largest operators, owning 12.2 per cent. and 50.9 per cent. of the crude pipeline infrastructure

in India, respectively.

Crude pipeline network by different operators

Operator Length (km.)

per cent. of

Total

IOCL ............................................................................................................ 5,301 50.9%

ONGC .......................................................................................................... 1,271 12.2%

OIL ............................................................................................................... 1,193 11.5%

HMEL .......................................................................................................... 1,017 9.8%

BPCL............................................................................................................ 937 9.0%

Cairn ............................................................................................................. 688 6.6%

Total ............................................................................................................. 10,406 100.0%

A39729228 139

There are presently three major pipeline entities in gas transportation across India: GAIL, Gujarat State Petronet

Limited (“GSPL”), and Reliance Gas Transportation Infrastructure Limited (“RGTIL”). GAIL operates

approximately 11,400 km of natural gas pipelines to evacuate natural gas from the Guarantor and Petronet LNG

Limited (“PLL”). GAIL’s network accounts for approximately 68 per cent. of the gas transmitted in India. RIL

operates the 1,784 km East West pipeline to evacuate gas from KG-D6 gas. This pipeline passes through Andhra

Pradesh, Maharashtra and Gujarat and is focused on tapping the Northern and Western India markets. GSPL

focuses on servicing the gas requirements of Gujarat. GAIL also operates regional gas pipeline network across

India.

Gas pipeline network by different operators

Operator Length (km.)

per cent. of

Total

GAIL ............................................................................................................ 11,410 68.0%

GSPL ............................................................................................................ 2,618 15.6%

RIL ............................................................................................................... 1,784 10.6%

AGCL, DNPL .............................................................................................. 812 4.8%

IOCL ............................................................................................................ 140 0.8%

ONGC .......................................................................................................... 24 0.1%

Total ............................................................................................................. 16,789 100.0%

Refining

As of 01 April 2018, the Indian crude oil refining sector consists of ten companies operating a total of 23

refineries, with a combined annual installed throughput capacity of approximately 4.9 MMbbl per day. Except

for the RIL refineries and Nyara Energy’s Vadinar refinery, all of India’s domestic refiners are either public-

sector enterprises or Joint venture with public-sector enterprises.

India’s Government-controlled oil marketing companies are the key players in the downstream petroleum

sector. Four of the Indian refining players, consisting of IOCL, RIL, BPCL, and the Company, made it into the

Global Fortune 500 list in 2018.

Major Refining Companies

The domestic refining sector has undergone significant consolidation beginning in 2001 as several refining

companies lacking marketing and distribution operations have been acquired by other domestic oil and gas

companies pursuing a vertical integration strategy. In March 2001, IOCL acquired controlling interest in

Bongaigaon Refineries and Petrochemicals Limited (“BRPL”) and Chennai Petroleum Corporation Limited

(“CPCL), and BPCL acquired controlling interest in Kochi Refineries Limited (“KRL”) and Numaligarh

Refineries Limited (“NRL”). The Company acquired a controlling interest in its subsidiaries, MRPL in March

2003 and Hindustan Petroleum Corporation Limited (“HPCL”) in January 2018.

The three Indian Government-owned national oil companies, IOCL, BPCL and HPCL, continue to dominate

the refined petroleum product retail sector in India, accounting in the aggregate for around 50 per cent. of

domestic refining capacity and 91 per cent. of total operational retail petrol stations as of 1 April 2018.

Other industry players include four publicly-owned corporations:

MRPL is the Guarantor’s downstream Subsidiary, which operates a single integrated refinery and

petrochemicals plant in Mangalore.

A39729228 140

CPCL is a subsidiary of IOCL, and operates two refineries in the state of Tamil Nadu

Nyara Energy (“NEL”) is a private sector refining company owned by a consortium led by Russian

integrated oil company Rosneft.

RIL is a private sector refining company, listed on the Indian stock exchange with refining operations in

Jamnagar, Gujarat.

Refining Capacity as of 01 April 2018

IOCL RIL BPCL ONGC HPCL NEL

Refining (million barrels per day) ......... 1.51 1.37 0.55 0.52 0.43 0.40

Note:

Installed refining capacity for IOCL, BPCL and the Guarantor include the capacities of their respective subsidiaries in proportion to their equity

shareholding

Refining End Products

The following table sets out information on the production, import, export and domestic consumption of major

categories of refined petroleum products for the periods indicated:

Product (MMbbl) 2013-14 2014-15 2015-16 2016-17 2017-18 2018-19(P)

Liquefied Petroleum Gas ....... Production 73.5 72.1 77.5 82.5 90.6 93.7

Imports 48.1 60.9 65.7 81.3 83.4 96.7

Exports 1.7 1.9 1.4 2.3 2.6 3.1

Consumption 119.4 131.9 143.8 158.4 171.1 182.6

Naphtha/Natural Gas

Liquids .............................. Production 135.7 128.0 130.9 144.6 146.5 143.7

Imports 7.5 7.6 21.5 20.4 16.2 14.7

Exports 61.0 51.4 52.2 64.0 65.6 51.0

Consumption 82.9 81.2 97.3 97.1 94.5 103.1

Motor spirits

(Gasoline/Petrol/ATF) ........ Production 304.1 317.5 345.3 369.3 384.3 392.3

Imports 1.7 3.7 9.5 6.0 3.5 7.0

Exports 153.9 158.1 164.9 166.3 155.5 148.6

Consumption 165.9 181.8 206.0 225.5 247.8 268.3

Kerosene ............................... Production 54.5 56.0 55.0 43.8 31.4 29.7

Imports 0.0 0.2 0.3 0.0 0.0 0.0

Exports 0.1 0.1 0.1 0.1 0.1 0.1

Consumption 52.5 51.9 50.0 39.6 28.2 25.3

High Speed Diesel ................. Production 687.4 691.5 722.6 748.4 792.0 810.4

Imports 0.6 0.9 1.3 7.4 10.0 4.0

Exports 194.0 187.3 176.2 200.1 217.8 204.0

Consumption 501.1 508.8 547.2 557.3 594.3 612.2

Fuel Oil/Low Sulphur

Heavy Stock ....................... Production 98.7 89.3 78.4 88.2 75.4 73.1

Imports 9.8 6.6 8.6 6.8 8.9 10.1

Exports 45.1 34.9 20.6 16.5 18.5 16.1

Consumption 45.7 43.7 48.6 52.4 49.3 47.7

A39729228 141

Alternate sources of energy

Coal Bed Methane

Coal bed methane is natural gas derived from coal that can be extracted by depressurisation. Having the fifth

largest proved coal reserves in the world, India holds significant prospects for commercial discovery of coal

bed methane. The Government formulated a coal bed methane policy in 1997 to explore and produce coal bed

methane in India and started awarding coal bed methane blocks through international bidding rounds in 2001.

The total sedimentary area for coal bed methane exploration is approximately 26,000 sq. km. To date, four

rounds of bidding have been carried out and 33 blocks have been awarded, covering an area of 16,613 sq. km.

spread over the states of West Bengal, Jharkhand, Rajasthan, Gujarat, Madhya Pradesh, Chhattisgarh,

Maharashtra, Orissa, Assam, Tamil Nadu and Andhra Pradesh. The estimated coal bed methane resource for the

awarded 33 coal bed methane blocks is approximately 1,767 BCM, out of which 280 BCM has been established

as gas-in-place.

Commercial coal bed methane production commenced from 1 block in Raniganj (South) on 14 July 2007. In

2017-18, the production was around 2.01 million standard cubic metres per day (MMSCMD). Seven more

blocks are expected to start commercial production soon.

Shale Gas

Shale gas has gained prominence particularly in the United States, where it contributed about 70 per cent. of

total dry gas production in December 2018. Further growth in shale gas production is expected as technology

improvements allow for higher recovery rates at lower costs. The experience in the United States with shale gas

has encouraged other countries to similarly venture into exploration and exploitation. There are large basin

segments in India, such as Cambay Basin, Gondwana Basin, KG Basin, Cauvery Basin, Indo-Gangetic Basin

and Assam Arakan Basin, which may be prospective for shale gas.

Oil Shale

Oil shale are fine grained sedimentary rocks containing relatively large amount of organic matter from which

significant quantities of shale oil and gas can be extracted. The product thus generated is known as synthetic

crude, or “syncrude”. In India, oil shale prospects have been identified in the Assam-Arakan Basin.

Underground Coal Gasification

Underground coal gasification (UCG) is the process by which one extracts coal gas from otherwise un-minable

coal reserves. Still in its early stages of development, underground coal gasification could provide India with a

significant source of energy in the future given India’s sizable coal deposits.

After evaluating several coal/lignite blocks, Vastan Mine block in Surat district, Gujarat was found suitable for

underground coal gasification. This site has been taken up by the Company as an R&D project to establish

underground coal gasification technology. Other sites that were previously identified by the Company and

Neyveli Lignite Corporation (“NLC”) for studying their suitability for UCG include Tadkeshwar, Gujarat, and

Hodu-Sindhari and East Kurla, Rajasthan.

Gas Hydrates

The National Gas Hydrate Program (“NGHP”) is a consortium of national exploration and production

companies (the Company, GAIL and OIL) and national research institutions (National Institute of

Oceanography, National Geophysical Research Institute and National Institute of Ocean Technology), which is

steered by the MoPNG and technically coordinated by the DGH. The National Gas Hydrate Program has

responsibility for exploring gas hydrates in India.

A39729228 142

India has established presence of gas hydrates in Krishna-Godavari, Mahanadi and Andaman areas and

discovered one of the thickest and deepest gas hydrate occurrences yet known (offshore of the Andaman

Islands). As of March 2015, operations under the NGHP Expedition-02 commenced, with Logging While

Drilling (LWD) completed at 13 wells. Expedition-03 aims to conduct pilot production testing in the Indian

deep-water environment, with its execution dependent on the success of Expedition-02.

Global Oil and Gas Market

Total global proved oil reserves stood at 1,730 billion barrels (“bn bbl”) and total proved gas reserves stood at

197 Tcm as of December 31, 2018. Most of the global proved reserves are located in the Middle East.

Oil: Proved reserves 2005 2010 2015 2018

Share of

total

bn bbl bn bbl bn bbl bn bbl In 2018

Total North America ....................................... 223.6 221.5 227.5 236.7 13.7%

Total South and Central America.................... 103.3 321.5 324.1 325.1 18.8%

Total Europe & Eurasia .................................. 139.5 157.9 154.8 159.0 9.2%

Total Middle East ........................................... 755.5 765.9 802.9 836.1 48.3%

Total Africa .................................................... 111.3 124.5 126.3 125.3 7.2%

Total Asia Pacific ........................................... 43.4 50.1 48.8 47.6 2.8%

Total World ................................................... 1,300.9 1,374.4 1,636.5 1,729.7 100.0%

Natural Gas: Proved reserves 2005 2010 2015 2018

Share of

total

Tcm Tcm Tcm Tcm In 2018

Total North America ....................................... 7.5 10.5 10.7 13.9 7.1%

Total South and Central America.................... 6.7 8.1 8.3 8.2 4.2%

Total Europe & Eurasia .................................. 46.2 54.2 62.4 66.7 33.9%

Total Middle East ........................................... 71.3 76.8 77.0 75.5 38.4%

Total Africa .................................................... 13.5 14.0 13.9 14.4 7.3%

Total Asia Pacific ........................................... 12.1 14.9 16.4 18.1 9.2%

Total World ................................................... 139.3 157.3 176.2 196.9 100.0%

Global oil consumption and production

Consumption of liquid fuels and other petroleum is expected to increase from 92.55 MMbbl/d in 2015 to 102.64

MMbbl/d in 2030. Approximately 80 per cent. of the projected increase in total liquid fuels consumption is

expected for the APAC nations.

World’s liquid fuels production in 2030 is expected to exceed the 2015 level by approximately 9 MMbbl/day.

Increases in production are expected for both Middle East and North America producers. Approximately 98 per

cent. of the total increase is expected to come from North America.

A39729228 143

Global Liquids Consumption (MMbbl/day)

2015 2020 2025 2030

North America ............................................. 22.74 23.52 22.89 21.84

South and Central America .......................... 6.35 6.29 6.81 7.17

Europe ......................................................... 14.27 14.47 13.83 12.64

CIS ............................................................... 3.97 4.24 4.42 4.6

Middle East .................................................. 9.03 9.77 10.09 10.55

Africa ........................................................... 3.88 4.29 4.87 5.52

APAC .......................................................... 32.31 36.39 38.75 40.32

Total World ................................................ 92.55 98.97 101.66 102.64

Global Liquids Production (MMbbl/day)

2015 2020 2025 2030

North America ............................................. 20.73 26.12 29.05 29.25

South and Central America .......................... 7.84 6.93 7.15 7.58

Europe ......................................................... 3.87 3.79 3.74 3.34

CIS ............................................................... 14.00 14.79 14.87 14.98

Middle East .................................................. 30.28 31.00 31.46 32.50

Africa ........................................................... 8.35 8.13 7.41 7.25

APAC .......................................................... 9.18 8.48 8.26 8.02

Total World ................................................ 94.25 99.24 101.94 102.92

Global natural gas consumption and production

Global natural gas consumption is expected to increase from 3,474 BCM in 2015 to 4,700 BCM in 2030, at a

CAGR of 2.0 per cent. APAC will account for 38.31 per cent. of this increase.

Middle East, Africa and APAC will together account for 52.42 per cent. of the incremental global natural gas

production of 1,182 BCM during 2015-2030.

Global Natural Gas Consumption (BCM)

2015 2020 2025 2030

North America ............................................. 924 1,036 1,115 1,165

South and Central America .......................... 179 182 211 241

Europe ......................................................... 506 585 593 583

CIS ............................................................... 538 548 557 570

Middle East .................................................. 487 554 655 736

Africa ........................................................... 130 158 185 226

APAC .......................................................... 710 869 1,029 1,180

Total World ................................................ 3,474 3,933 4,345 4,700

A39729228 144

Global Natural Gas Production (BCM)

2015 2020 2025 2030

North America ............................................. 949 1,103 1,239 1,326

South and Central America .......................... 181 182 200 229

Europe ......................................................... 261 245 225 196

CIS ............................................................... 753 827 907 954

Middle East .................................................. 608 670 770 885

Africa ........................................................... 204 257 281 332

APAC .......................................................... 564 659 723 778

Total World ................................................ 3,519 3,944 4,346 4,701

Note:

Differences between global production and consumption totals result from independent rounding and differences in

conversion factors derived from heat contents of natural gas that is produced and consumed regionally

Oil Prices

Prices began to fall mid-2014 due to the combined effects of 1) the slowing of growth in economies such as

China, placing a downward pressure on demand, and 2) the expansion of producers in countries such as the

United States and Canada into shale and oil sands, cutting their oil imports and adding additional downward

pressure on prices. Since then, crude prices have been hovering between U.S.$ 50 to U.S.$ 80 per bbl range.

Based on data from S&P Global Platts, the average price of Bonny light crude was U.S.$ 50.03 per barrel in

FY 2016-17, U.S.$ 57.97 per barrel in FY 2017-18 and U.S.$ 71.60 per barrel in FY 2018-19.

Currently, oil prices are trading in range of U.S.$55 – 70 per barrel.

Gas Prices

Natural gas prices tend to be set locally and regionally (unlike crude-oil prices that are global in nature). In the

United States, Henry Hub has traded on average at approximately US $ 2.77 per MMbtu for FY 2016-17, US $

3.00 per MMbtu for FY 2017-18, US $ 3.11 per MMbtu for FY 2018-19 and U.S.$2.66 per MMbtu in 2019

(20)

0

20

40

60

80

100

120

140

160

U.S

.$/b

bl

Spread (Brent-WTI) Brent WTI

A39729228 145

(year-to-date). A steep increase in United States domestic natural gas production, fuelled by the shale gas boom,

has resulted in relatively lower gas prices. Low natural gas prices in the United States have presented a price

advantage over coal and have further stimulated gas-fired power generation. According to EIA, the share of

natural gas in electricity generation reached 34 per cent. in 2018, compared to 28 per cent from coal and 19 per

cent from nuclear fuel.

In Europe, on the other hand, natural gas prices have risen since 2011. In the United Kingdom, the average

National Balancing Point (“NBP”) price was 12 per cent. higher in 2013 compared to 2012. In 2014, NBP

prices began to fall, in line with the fall in benchmark oil prices. A combination of milder winters, increased

LNG supply, and a general weakness in the commodities market added further downward pressure on prices.

NBP has traded on average at approximately US $ 5.05 per MMbtu for FY 2016-17, US $ 6.32 per MMbtu for

FY 2017-18, US $ 7.61 per MMbtu for FY 2018-19.

Country Overview

Azerbaijan

Azerbaijan’s proved crude oil reserves were estimated at 7 billion barrels as of December 2018. In 2018,

Azerbaijan produced approximately 795,000 bbl/d of oil and consumed approximately 98,000 bbl/d. Azerbaijan

exported an estimated 700,000 bbl/d of crude oil in 2017, below the 2010 peak of approximately 908,000 bbl/d.

Azerbaijan’s proved natural gas reserves were roughly 2.1 Tcm as of December 2018, up 62 per cent. from

2017, with most of these reserves are located in the Shah Deniz offshore natural gas and condensate field. In

2018, Azerbaijan produced 18.8 BCM of natural gas and consumed 10.8 BCM. Azerbaijan has been a net

exporter of natural gas since 2007. Azerbaijan exports its natural gas, mainly via the South Caucasus Pipeline

to Turkey. Under a previous arrangement, Turkey re-exported Azerbaijani natural gas to Greece, but a new

agreement allows Azerbaijan to directly export volumes to the European Union. Deliveries to Turkey began in

mid-2018, and deliveries to Southeastern Europe are scheduled to start by 2020.A small volume of natural gas

is shipped to Iran via the Baku-Astara pipeline. In exchange, Iran ships natural gas to Nakhchivan, Azerbaijan’s

exclave situated between Iran and Turkey.

Bangladesh

In Bangladesh, natural gas accounts for most of its total primary energy consumption. In 2018, natural gas

consumption was 28.4 BCM, accounting for approximately 69 per cent. of Bangladesh’s primary energy

0

2

4

6

8

10

12

14

16

18

20

U.S

.$/M

Mb

tu

Henry Hub NBP

A39729228 146

consumption. The total oil consumption in 2018 was approximately 176,000 bbl/d, approximately 25 per cent.

of total primary energy consumption.

Bangladesh’s proved natural gas reserves were estimated at 0.2 Tcm as of December 2018. In 2018, Bangladesh

was the seventh largest natural gas producer in the Asia Pacific region, producing 27.5 BCM of natural gas, all

of which was consumed domestically. Natural gas production has increased by an annual average of

approximately 5 per cent. from 2013 to 2018, but still faces supply shortages especially in the electricity sector.

In recent years, Bangladesh has been looking to increase natural gas supply through LNG imports.

Brazil

Brazil’s proved oil reserves were estimated at 13.4 billion barrels as of December 2018, the second-largest in

South America after Venezuela. More than 94 per cent. of Brazil’s oil reserves are located offshore, and 80 per

cent. of all reserves are found offshore near the state of Rio de Janeiro. In 2018, Brazil produced 2.68 million

bbl/d of oil. An increased proportion of production is seen coming from oil deposits in the pre-salt layer. In July

2017, output from pre-salt offshore wells surpassed combined volumes from all other fields for the first time.

In 2018, Brazil consumed 3.8 million bbl/d of oil.

Brazil exported approximately 997,000 bbl/d of crude oil in 2017, up 25 per cent. from previous year. China

imported 423,000 bbl/d in 2017, making it the largest importer of Brazilian crude. The United States was the

second largest importer, at approximately 170,000 bbl/d, followed by India & Chile at approximately 90,000

bbl/d each in 2017.

Brazil’s proved natural gas reserves were estimated at 0.4 Tcm as of December 2018, most of which are located

offshore. In 2018, Brazil produced 25.2 BCM of natural gas. Total natural gas consumption was 35.9 BCM.

Demand from the industrial sector made up 50 per cent. of Brazil’s total natural gas consumption in 2017.

Colombia

Colombia had approximately 1.8 billion barrels of proved crude oil reserves as of December 2018. Colombia

produced 866,000 bbl/d of oil in 2018, up 1.4 per cent. from 2017. In 2018, oil consumption was 342,000 bbl/d.

Crude oil production far exceeds domestic demand and making the country a net crude oil exporter. In 2017,

the United States was the primary destination for crude oil exports. In 2017, Colombia exported 580,000 bbl/d

of crude oil, of which 330,000 bbl/d of crude oil was exported to the United States.

Colombia had proved natural gas reserves of 0.11 Tcm as of December 2018. The bulk of Colombia’s natural

gas reserves are located in the Llanos basin, although the Guajira basin accounts for the majority of current

production. Colombia produced 12.9 BCM of natural gas in 2018, while consuming 13.0 BCM. Approximately

half of the country’s total gross natural gas production was reinjected to aid in enhanced oil recovery.

Iran

As of December 2018, Iran had an estimated 155.6 billion barrels of proved oil reserves, nine per cent. of the

world’s total reserves. In 2018, Iran produced approximately 4.7 million bbl/d of crude oil. Iran is the second-

largest oil-consuming country in the Middle East, second only to Saudi Arabia. Iranian domestic oil

consumption is mainly diesel, gasoline, and fuel oil. Total oil consumption in Iran was approximately 1.9

million bbl/d in 2018. In 2016, oil exports increased sharply as it started exporting oil to Europe following the

implementation of the JCPOA. In 2017, oil exports averaged 2.5 million bbl/d, mainly sold to China, India,

Turkey, and South Korea.

As of December 2018, Iran’s estimated proved natural gas reserves stood at 31.9 Tcm. Most Iranian natural gas

reserves are located in non-associated fields, and most of these reserves have not been developed. Over the last

two decades, Iran’s natural gas production has rapidly increased, rising from 44.5 BCM in 1998 to 239.5 BCM

A39729228 147

in 2018, and accounts for around 6.2 per cent. of the world’s natural gas production. Domestic consumption is

estimated at 225.6 BCM in 2018.

Iraq

Iraq has the fifth largest proved crude oil reserves in the world, estimated to be 147.2 billion barrels as of

December 2018. Iraqi crude oil production averaged 4.6 million bbl/d in 2018. Iraq exported an average of 3.8

million bbl/d of crude oil in 2018. Iraq exports more than half of its total exports to Asia, led by India, China,

and South Korea. Outside of Asia, the United States is the largest importer, took approximately 602,000 bbl/d

of Iraqi crude in 2017.

Iraq’s proved natural gas reserves as of December 2018 was 3.6 Tcm, with around three–quarters of these

reserves are associated with oil. Due to lack of midstream infrastructure, natural gas is mostly flared in the

country. In 2017, Iraq flared 17.8 BCM of natural gas, ranking as the second-largest source country of flared

gas in the world behind Russia. Iraqi natural gas production was 13.0 BCM in 2018, up 28.4 per cent. from

2017. Iraq began importing natural gas from Iran in June 2017 to fuel electric power plants near Baghdad,

including the Al–Besmaya, Al–Quds, Al–Mansuriyah, and Al–Sadr stations. Some of this natural gas is used as

fuel for power generation, while a portion of it is re-injected to enhance oil recovery.

Israel

As of January 2016, Israel had estimated proved oil reserves of 14 million barrels. In 2018, oil consumption

was 242,000 bbl/d, most of which is imported from overseas with only negligible amount of domestic

production. However, oil discoveries in the Golan Heights and near the Dead Sea have the potential to positively

impact Israel's quest for energy independence.

Israel had 0.4 Tcm of proved natural gas reserves in December 2018. In 2018, the country consumed 10.5 BCM

of natural gas. Energy exploration over the past several years has uncovered significant natural gas resources

in Israel, primarily in the country's offshore areas, which is expected to provide enough fuel to meet Israel's

rising domestic needs, and extra gas resources will likely be exported. Leviathan field, which holds

approximately 623 Tcm of natural gas reserve (as per initial assessment), is expected to begin export by end of

2019.

Kazakhstan

Kazakhstan’s proved oil reserves were estimated at 30.0 billion barrels As of December 2018. Kazakhstan’s oil

production was 1.9 million bbl/d in 2018. In 2017, Kazakhstan exported nearly 1.3 million bbl/d of crude and

condensate. The current infrastructure delivers the oil to export markets by pipelines to the Black Sea via Russia;

by barge and pipeline to the Mediterranean via Azerbaijan and Turkey; by barge and rail to Batumi, Georgia on

the Black Sea; and by pipeline to China.

Kazakhstan has proved natural gas reserves of 1.0 Tcm. Natural gas production in Kazakhstan is almost entirely

associated gas. Dry natural gas production in Kazakhstan has remained relatively stable, with the reinjection of

natural gas boosting gross production. In 2018, natural gas production was 24.4 BCM.

Libya

Libya had proved crude oil reserves of 48.4 billion barrels as of December 2018, the tenth largest globally. In

2018, Libya produced 1.0 million bbl/d of crude oil. Prior to the onset of hostilities in 2011, Libya had been

producing an estimated 1.8 million bbl/d of mostly high-quality light, sweet crude oil. The country’s oil sector

was crippled again in mid-2013 as protests led to the closure of loading ports, oil fields, pipelines, and a sharp

deterioration of the security environment at oil installations.

Libya consumed an estimated 150,000 bbl/d of petroleum in 2016. Libya’s crude oil exports in 2016 averaged

300,000 bbl/d, lower than the 2012 level of 1.2 million bbl/d. Exports have been curtailed due to disruptions to

A39729228 148

production that escalated mid-2013 and continued through 2015. In 2014, roughly 84 per cent of Libya’s crude

exports were sent to Europe; the largest markets for Libyan crude exports were Italy, Germany, and France.

As of December 2018, Libya’s proved natural gas reserves were 1.4 Tcm. Natural gas production averaged 9.8

BCM in 2018. Libya’s sole LNG plant, built in the late 1960s at Marsa al-Brega, is owned by the Libyan

national oil company and operated by Sirte Oil Company. However, it went offline in February 2011 as a result

of damage sustained during the civil war and has not exported LNG since early 2011.

Mozambique

Mozambique holds 2.8 Tcm of proved natural gas reserves, third-largest in Africa after Nigeria and Algeria.

The country has large onshore and offshore sedimentary basins that contain natural gas resources, much of

which is unexploited. In 2016, Mozambique produced 5.7 BCM of natural gas. Most of Mozambique’s

production was exported (3.96 BCM) to South Africa via the 535-mile Sasol Petroleum International Gas

Pipeline and the remainder was domestically consumed.

Since 2010, there have been a series of natural gas discoveries in the offshore Rovuma Basin that are large

enough to support LNG projects. The U.S.-based Anadarko and Italy-based Eni have led exploration activities

in the area. Anadarko made several natural gas discoveries in its Prosperidade and Golfinho/Atum complexes,

which together are estimated to contain 2.1 Tcm of recoverable natural gas resources, respectively. Eni’s natural

gas discoveries are in the Mamba complex and the Coral site, of which each contain 2.4 Tcm of natural gas in

place, respectively. Anadarko announced the final investment decision on the Area 1 Mozambique LNG project

in June 2019.

Myanmar

As of December 2018, Myanmar has natural gas reserves of 1.2 Tcm. Myanmar produces a minimal amount of

crude oil and condensates from the onshore Salin basin and offshore Yetagun field. The low production and

limited refining capacity are insufficient to meet domestic demand for crude oil and products, making the

country a net oil importer.

Myanmar’s natural gas production averaged 17.8 BCM in 2018. The natural gas has historically lagged behind

production, but development in the country is increasing its consumption. Exports to Thailand, which began in

1999, now account for about 75 per cent. of Myanmar’s natural gas exports. Natural gas exports to China

commenced in mid-2013 with the development of the first phase of the Shwe natural gas project in the Rakhine

Basin. PTT Exploration and Production Public Company Limited, Thailand’s national oil company, launched

commercial operations of the Zawtika gas project in the second half of 2014 and currently producing at 8.5

MMcm/d.

Namibia

Namibia has no proven oil reserves and has been ignored by explorers over the years in favour of better-

established hydrocarbons markets. But the impact of a higher oil price and lower drilling costs has started

attracting explorers. It is estimated that the country consumed 27,000 bbl/d of oil in 2016.

Namibia had 62.3 BCM of proved natural gas reserves in January 2018, with no production.

New Zealand

The New Zealand Oil and Gas Industry mainly operates out of the Taranaki region. Most of the basin is offshore.

Due to cheaper exploration and drilling costs, the majority of producing fields remain onshore, albeit smaller

than the offshore fields. Other than the Taranaki Basin, the rest of New Zealand, which includes the Great South

Basin, Canterbury, Reinga-Northland, East Coast, and other deep-water acreage can be considered relatively

under-explored and have attracted significant interest as potential emerging basins.

A39729228 149

As at 1 January 2018, New Zealand’s proved oil and condensate reserves was approximately 63.5 million

barrels. The Maari and Pohokura fields account for more than half of domestic oil production. Despite having

the capability to produce oil and gas, New Zealand is a net importer of oil as domestically-produced oil is

generally exported due to its high quality and value in the international market. In 2018, New Zealand consumed

approximately 173,000 bbl/d of oil.

As at 1 January 2018, New Zealand’s proved natural gas and LPG reserves was approximately 42 BCM. Most

of the total production comes from the Pohokura and Maui fields. In 2018, New Zealand consumed

approximately 4.3 BCM of natural gas.

Russia

Russia’s proved oil reserves were 106.2 billion barrels as of December 2018. Most of Russia’s resources are in

Western Siberia, between the Ural Mountains and the Central Siberian Plateau and in the Volga-Urals region,

extending into the Caspian Sea.

Russia was the third-largest producer of liquid fuels in 2018, following the United States and Saudi Arabia. In

2018, Russia produced an estimated 11.0 million bbl/d of total liquids and it consumed roughly 3.2 million

bbl/d. The United States imposed a series of progressively tighter sanctions on Russia in 2014, as a response to

the actions and policies of the government of Russia with respect to Ukraine. These sanctions reduced foreign

investment in Russia’s upstream, especially in Arctic offshore and shale projects.

Russia held the world’s largest natural gas reserves, with 38.9 Tcm, as of December 2018. Russia’s reserves

account for about a 20 per cent. of the world’s total proved reserves. The majority of these reserves are located

in Siberia, with the Yamburg, Urengoy, and Medvezh’ye fields alone accounting for a significant share of

Russia’s total reserves, while other deposits are located in northern Russia.

In 2018, Russia was the world’s second-largest dry natural gas producer (670 BCM), second only to the United

States (832 BCM). In 2016, Russia sent about 90 per cent. of its natural gas exports to customers in Western

Europe, with Germany, Turkey, Italy, Belarus, and Ukraine receiving the bulk of these volumes. Much of the

remainder was delivered to Asia as LNG.

Russia is a net exporter of LNG. Sakhalin Energy’s LNG plant has been operating since 2009, and it can export

up to 22 MMcm of LNG per year on two trains. Most of the LNG has been contracted to Japanese and South

Korean buyers under long-term supply agreements. In 2016, Sakhalin LNG exports went to Japan (65 per cent.),

South Korea (23 per cent.), China (3 per cent.), and Taiwan (10 per cent.).

Sudan and South Sudan

The erstwhile Sudan has been formally separated and divided into two independent countries, namely, Sudan

and South Sudan on 9 July 2011.

Most of Sudan’s and South Sudan’s proved reserves of crude oil and natural gas are located in the Muglad and

Melut basins, which extend into both countries. Natural gas associated with oil fields is flared or re-injected.

Neither country currently produces or consumes marketed natural gas.

Sudan and South Sudan had an aggregate of 5 billion barrels of proved crude oil reserves as of December 2018.

Approximately 3.5 billion barrels are estimated in South Sudan and 1.5 billion barrels are in Sudan. Most of

reserves are located in the oil-rich Muglad and Melut basins, which extend into both countries. Oil is transported

through two main pipelines that stretch from the landlocked South to Port Sudan. Because of civil conflict, oil

exploration prior to the 2011 independence was mostly limited to the central and south-central regions of the

unified Sudan.

In 2018, combined production from Sudan and South Sudan was approximately 230,758 bbl/d.

A39729228 150

Natural gas associated with oil fields is mostly flared or re-injected. Despite proved reserves of 85 BCM, gas

development has been limited.

Syria

Syria’s has proved reserves of 2.5 billion barrels as of December 2018, a total larger than all of Syria’s

neighbours except for Iraq. Syria produced 24,000 bbl/d of oil in 2018. Much of Syria’s crude oil is heavy and

sour, making the processing and refining of Syrian crudes difficult and expensive. Further, because of sanctions

placed on Syria by the European Union in particular—which accounted for the vast majority of Syrian oil

exports previously, there are limited markets available that can import and process the heavier crudes produced

in Syria.

The on-going conflict between government and opposition forces makes oil exploration in Syria nearly

impossible, and further bidding rounds are unlikely to occur until a resolution occurs.

United Arab Emirates

United Arab Emirates had 97.8 billion barrels of proved oil reserves as of December 2018, with approximately

96 per cent. of the reserves located in Abu Dhabi. The country is seventh largest oil producer in the world and

is also a major oil exporter. It is estimated that the country produced around 3.9 million bbl/d of crude oil and

consumed 991,000 bbl/d in 2018.

United Arab Emirates holds the eighth-largest proved reserves of natural gas in the world, estimated to be 5.9

Tcm as of December 2018. UAE natural gas production was 64.7 BCM in 2018, up 4.4 per cent. from 2017.

The country consumed 76.6 BCM of oil in 2018. To help meet the growing demand for natural gas, the UAE

boosted imports from neighbouring Qatar via the Dolphin Gas Project’s pipeline, which began supplying natural

gas in 2007. The pipeline supplies all seven Emirates and meets roughly 26 per cent. of the country’s natural

gas demand. Despite the challenges of producing natural gas domestically, United Arab Emirates hopes to

further boost production to help meet the country’s growing demand.

Vietnam

Vietnam has proved crude oil reserves of 4.4 billion barrels as of December 2018. Vietnam produced around

275,000 bbl/d of oil in 2018, down from its peak of 403,000 bbl/d in 2004. Vietnam is a net exporter of crude

oil but is a net importer of oil products. With oil consumption doubling from 250,000 bbl/d in 2006 to 522,000

bbl/d in 2018, the country must import most refined products to satisfy demand.

As of December 2018, Vietnam holds 646 BCM of proved natural gas reserves. Vietnam produced 9.6 BCM of

dry natural gas in 2018, all of which was domestically consumed. The country is currently self-sufficient in

natural gas, but PetroVietnam predicts a growing supply gap characterised by demand surpassing supply,

particularly in the southern region of Vietnam.

Venezuela

Venezuela had 303.3 billion barrels of proved oil reserves in December 2018. It is estimated that the country

produced around 1.5 million bbl/d of crude oil in 2018.

Venezuela sends a large share of its oil exports to the United States because geographic proximity enhances

export profitability and because refineries on the U.S. Gulf Coast are specifically designed to handle heavy

Venezuelan crude. In 2018, Venezuela was the United States’ fourth largest supplier of imported crude oil and

petroleum products behind Canada, Saudi Arabia and Mexico.

An estimated 90 per cent. of Venezuela’s natural gas reserves are associated. Venezuela had 6.3 Tcm of proved

natural gas reserves in December 2018. In 2018, the country produced 33.2 BCM of natural gas, while

consuming nearly 33.4 BCM.

A39729228 151

DESCRIPTION OF ONGC VIDESH LIMITED

Introduction

Background

ONGC Videsh Limited (“ONGC Videsh”), an issuer under the Programme, is a wholly owned

subsidiary of the Company. ONGC Videsh was incorporated on 5 March 1965 as Hydrocarbons India Private

Limited and was subsequently rechristened as ONGC Videsh Limited on 15 June 1989. ONGC Videsh has since

grown to become, after the Company, the second-largest Indian exploration and production company, both in

terms of production and reserves, according to Ministry of Petroleum and Natural Gas statistics for the year

ended 31 December 2018.

Vision and Objectives

ONGC Videsh strives to be a world-class exploration and production company providing energy security

to India. Its key objectives include: (a) supporting India’s energy security, (b) building a balanced portfolio of

exploration, discovered and producing assets in focus countries, (c) building a team that excels in performance

through assimilation of best practices and technologies, (d) being at par with the best international oil and gas

companies, (e) being the strongest Indian player in the international extraction and production sector and (f)

building collaborative relations with its respective partners.

Business

ONGC Videsh’s primary business is to prospect for oil and gas acreages abroad, including the acquisition

of oil and gas fields, exploration, development, production, transportation and export of oil and gas.

As of 31 March 2019, ONGC Videsh has stake in 41 oil and gas projects across 20 countries namely in

Azerbaijan (2 projects), Bangladesh (2 projects), Brazil (2 projects), Colombia (7 projects), Iran (1 project),

Iraq (1 project), Israel (1 project), Kazakhstan (1 project), Libya (1 project), Mozambique (1 project), Myanmar

(6 projects), Namibia (1 project), New Zealand (1 Project), Russia (3 projects), South Sudan (2 projects), Sudan

(2 projects), Syria (2 projects), UAE (1 project), Venezuela (2 projects), and Vietnam (2 projects).

ONGC Videsh adopts a balanced portfolio approach and maintains a combination of producing,

discovered, exploration and pipeline assets. As of the date of this Offering Circular, ONGC Videsh has oil and

gas production from 15 producing projects, 4 discovered/development projects where hydrocarbons have been

discovered and are at various stages of development, 18 exploration blocks are under various stages of

exploration and 4 pipeline projects. Some of the leading alliance partners of ONGC Videsh are BP, CNPC,

Ecopetrol, Exxon, Statoil Hydro, Petróleos de Venezuela, Petrobras, Petronas, PetroVietnam, Repsol, Rosneft,

Shell, Sinopec, Total and Turkish Petroleum Corporation (“TPAO”).

For more details on ONGC Videsh’s business and operations, see the section entitled “Business”.

Health, Safety and Environment

ONGC Videsh operates in varied geographical and political environments and attaches highest priority

to occupational health, safety and protection of environment in and around its operational areas. It has

implemented ‘Integrated policy on QHSE and Risk Management’, which comprehensively deals with all related

domains. ONGC Videsh is certified for Integrated QHSE Management System is in line with revised standards

ISO 9001:2015 (Quality Management System), ISO 14001:2015 (Environment Management System) &

OHSAS 18001:2007 (Occupational Health and Safety Management System) with the scope ‘The Business

Development activities for Acquisition of overseas oil and gas fields and management of Exploratory,

Developing and Producing Assets at OVL HQ.’

ONGC Videsh also publishes its consolidated sustainability report on an annual basis.

A39729228 152

Corporate Social Responsibility

ONGC Videsh, operating overseas, understands its responsibility to contribute to the communities and

economies of the countries in which it operates. ONGC Videsh is committed to creating a positive and lasting

social impact by developing successful partnerships built on mutual trust and respect, ultimately, raising the

standard of living and the stability of the communities of the countries in which it operates. ONGC Videsh

makes valuable contributions in many ways: through payment of tax revenues to governments; by investing in

education and training and improving employment opportunities for nationals; providing

medical/sports/agricultural facilities to the local communities, etc. Further, with the objective of ensuring access

by every citizen to information under the control of ONGC Videsh and in order to bring in transparency and

accountability, an appropriate mechanism has been set up at ONGC Videsh’s corporate and registered office in

New Delhi in line with the requirements of the Right to Information Act, 2005.

Directors

ONGC Videsh’s Articles of Association require it to have not less than three and not more than 15

Directors on its Board of Directors. As of the date of this Offering Circular, ONGC Videsh has nine directors,

of which the Chairman is a non-executive Director, two are full-time Directors, two are Government Nominee

Directors and four are Independent Directors. Additionally, all executive directors of the Company are Special

Invitees to the Board meetings of ONGC Videsh.

The following table sets out the details regarding ONGC Videsh’s Board of Directors and Special

Invitees as of the date of this Offering Circular.

Name, Designation and Nationality Age Other Directorships

Mr. Shashi Shanker

Designation: Chairman

Nationality: Indian

58 Oil and Natural Gas Corporation Limited

Mangalore Refinery and Petrochemicals Limited Mangalore SEZ Limited

ONGC Tripura Power Company Limited

ONG Petro-additions Limited

ONGC Mangalore Petrochemicals Limited

Petronet LNG Limited

Mr. Vivekanand

Designation: Director (Finance)

Nationality: Indian

57 Imperial Energy Limited*

Mr. Girija Shankar Chaturvedi

Designation: Director (Exploration)

Nationality: Indian

58 ONGC Amazon Alaknanda Limited*

LLC Nord Imperial*

LLC Allianceneftegaz*

Mansarovar Energy Colombia Limited*

Dr. Kumar V. Pratap

Designation: Government Nominee

Director

Nationality: Indian

55 India Infrastructure Finance Company Limited

Indian Railway Finance Corporation Limited

Indian Railway Station Development Corporation

Mr. B. N. Reddy

Designation: Government Nominee

Director

Nationality: Indian

53 Oil India Limited

Mr. Ajai Malhotra

Designation: Independent Director

Nationality: Indian


A39729228 153


Mr. Bharatendu Nath Srivastava


Nationality: Indian

65 Nil

Mr. Rakesh Kacker


Nationality: Indian

66 PTC India Limited

Ms. Kiran Oberoi Vasudev


Nationality: Indian

65 Civic Innovation Foundation (Promotor)

Mr. Rajesh Kumar Srivastava

Designation: Special Invitee, Director

(Exploration) of Oil and Natural Gas

Corporation Limited

Nationality: Indian


Mr. Subhash Kumar

Designation: Special Invitee,

Director(Finance) of Oil and Natural Gas

Corporation Limited

Nationality: Indian


Mangalore Refinery and Petrochemicals Limited

Hindustan Petroleum Corporation Limited

Petronet MHB Limited

ONGC Tripura Power Company

ONGC Petro-additions Limited

Mangalore SEZ Limited

Mr. Rajesh Kakkar


(Offshore) of Oil and Natural Gas

Corporation Limited

Nationality: Indian




Pawan Hans Limited

Mr. Sanjay Kumar Moitra


(Onshore) of Oil and Natural Gas

Corporation Limited

Nationality: Indian


Dahej SEZ Limited


Mr. N. C. Pandey


(Technology and Field Services) of Oil and

Natural Gas Corporation Limited

Nationality: Indian



North East Transmission Company Limited

Dr. Alka Mittal


(HR) of Oil and Natural Gas Corporation

Limited

Nationality: Indian



__________

Note: *Subsidiary/ Joint Ventures of ONGC Videsh incorporated outside India.

A39729228 154

Save for the six Special Invitee Directors from the Company as disclosed above, there are no

arrangements or understanding with major shareholders, customers, suppliers or others, pursuant to which any

of the directors were selected as a director or member of senior management.

Details of Directors

Mr. Shashi Shanker has been the Chairman and Chief Executive Officer of ONGC Videsh since 12

October 2017. Mr Shanker is also concurrently the Chairman and Managing Director of the Company since 1

October 2017. Prior to his appointment as Chairman and Chief Executive Officer of ONGC Videsh, Mr. Shanker

was the Director (Technology and Field Services) of the Company. Mr. Shanker is an industry veteran with over

37 years of experience in diverse exploration and production activities in the oil and gas industry. He is a

Petroleum Engineer from Indian School of Mines, Dhanbad. He also holds a Master of Business Administration

with specialisation in Finance from Indira Gandhi National Open University. He has also received executive

education from the Indian Institute of Management, Lucknow and Indian School of Business, Hyderabad.

Mr. Vivekanand has been the Director (Finance) of ONGC Videsh since 1 September 2016. He holds a

Master’s Degree in Commerce from Delhi University, a Master of Business Administration in Finance, Cost

and Management Accountant from the Institute of Cost and Management Accountant of India and a Post-

Graduate Diploma in Treasury and Forex Management from the Institute of Certified Financial Analyst of India.

Mr. Vivekanand has experience of over 34 years as a Finance and Accounting professional in the upstream oil

and gas industry, both in domestic and international operations. Mr. Vivekanand joined the Company in 1984

as a Graduate Trainee. During his tenure at the Company, Mr. Vivekanand worked across different fields of

finance and accounting activities and has handled key finance assignments of the Company across a range of

segments including treasury, taxation, risk management, business development, overseas projects and various

other corporate functions such as budgeting, accounting, internal audit, marketing. At ONGC Videsh, Mr.

Vivekanand was previously the Group General Manager – Head of Finance and has been significantly involved

in its financing activities. Mr. Vivekanand is currently also a director of Imperial Energy Limited.

Mr. Girija Shankar Chaturvedi has been the Director (Exploration) of ONGC Videsh since 1 October

2018. Mr. Chaturvedi has experience of 33 years in the oil and gas industry especially in exploration and

production. Mr. Chaturvedi joined the Company as a geophysicist (surface) in 1985. During his tenure at the

Company and in his current role at ONGC Videsh, Mr. Chaturvedi has been involved in responsible for the

different aspects of the oil and gas exploration ranging from Seismic Data acquisition, interpretation to the

management of domestic exploration business. Mr. Chaturvedi is currently also a director of ONGC Amazon

Alaknanda Limited, LLC Nord Imperial, LLC Allianceneftegaz and Mansarovar Energy Colombia Limited.

Mr. Chaturvedi holds a Master of Science (Tech) in Exploration Geophysics from Banaras Hindu University.

Prior to joining ONGC Videsh as Director (Exploration) he was the Group General Manager (GP-S) for

Exploration Contract Monitoring Group of the Company.

Dr. Kumar V. Pratap joined as a Government Nominee Director on ONGC Videsh’s Board on 16

January 2018. Dr. Kumar is currently the Joint Secretary (Infrastructure, Policy, Finance, and Energy), Ministry

of Finance, Indian Government. Prior to his current appointment, Dr. Kumar had served in various other

government offices in New Delhi including the Prime Minister’s Office, Ministry of Finance and Urban

Development and Planning Commission, and had also served in the World Bank and Embassy of India. Dr.

Kumar was part of several Indian Government committees in the infrastructure sector including the Task Force

for setting up a Road Regulator, and the chair of the Committee writing the Model Concession Agreement for

Public-Private Partnerships (PPPs) in the Urban Water Supply sector. Dr. Kumar received his Master of

Business Administration degree from Indian Institute of Management (IIM), Lucknow in 1987 and his Doctor

of Philosophy (Ph.D.) degree from University of Maryland, College Park, the United States in 2011. Dr. Kumar

has lectured at the University of Michigan (Ann Arbor), London School of Economics, Singapore Management

University, Lee Kuan Yew School of Public Policy (Singapore), Duke University (North Carolina), University

A39729228 155

of Maryland (College Park), University of South Carolina (Columbia), World Bank (Washington DC), Indian

Institute of Management (IIM, Lucknow), IIM (Indore) and National Academy of Administration (Mussoorie).

Dr. Kumar is a recipient of University of Melbourne's Emerging Leaders Fellowship, University of Maryland’s

John J Sexton and Doctoral Fellowships, a letter of appreciation from the Indian Prime Minister, and the

National Talent Search Examination (NTSE) scholarship. Dr. Kumar is currently also a director of India

Infrastructure Finance Company Limited, Indian Railway Finance Corporation Limited and Indian Railway

Station Development Corporation.

Mr B. N. Reddy joined as a Government Nominee Director on ONGC Videsh’s Board on 13 March

2019. Mr. Reddy is currently an Officer on Special Duty (International Co-Operation) of the Ministry of

Petroleum and Natural Gas, Indian Government. Prior to joining the Ministry of Petroleum and Natural Gas,

Indian Government, Mr. Reddy served in various capacities across both public and private sectors. Mr. Reddy

joined the Indian Foreign Service (IFS) in 1993 where he has served in various missions for India in Indonesia

(1995-1998), Lao PDR (1998-2001), New York (Permanent Mission of India) (2005-2008), Malaysia (2008-

2011) and Geneva (as the DPR in Permanent Mission of India) (2013-2016). He has also served in the Ministry

of External Affairs, Indian Government where he has held various positions including in the Administration

Division, as the Director/Joint Secretary to the External Affairs Minister of India and as the High Commissioner

of India to Nigeria from June 2016 to December 2018. In addition, Mr. Reddy had also previous served with

Tata Motors Limited (formerly known as Tata Engineering and Locomotive Company) and Indian Engineering

Service. Mr Reddy holds a Master’s Degree in Thermal Engineering from the Indian Institute of Technology

Bombay, and a Bachelor’s Degree in Mechanical Engineering from Birla Institute of Technology and Science,

Pilani. Mr. Reddy is currently also a director of Oil India Limited.

Mr. Ajai Malhotra joined as an Independent Director on ONGC Videsh’s Board on 16 January 2017.

He holds a Bachelor’s Degree in Economics (Honours) from Hindu College, Delhi University, a Master’s

Degree in Economics from Delhi School of Economics, Delhi University and was awarded an Honorary

Doctorate by the Western University of Arad, Romania, in recognition of his work in support of environmental

causes and development. He is an elected Member of the Advisory Committee of the United Nations Human

Rights Council, Geneva, since 30 September 2017. Mr. Malhotra is a Retd. Indian Foreign Service (IFS) (1977

Batch) Officer. Mr. Malhotra was Minister (Commerce) at the Embassy of India in Washington DC from 1999

to 2003, serving simultaneously from 2002-2003 as Chairman of the International Cotton Advisory Committee.

He was Ambassador of India to Romania, concurrently accredited to Albania and Moldova from 2003 to 2005,

Ambassador and Deputy Permanent Representative of India to the United Nations in New York from 2005 to

2009, Ambassador of India to Kuwait from 2009 to 2011 and Ambassador of India to the Russian Federation

from 2011 to 2013, before retiring from the IFS on 30 November 2013 after 37 years of distinguished service.

His wide-ranging experience includes being on the Indian team negotiating issues such as biological diversity,

climate change, desertification, education, energy, forestry, health, human rights, human settlements,

intellectual property rights, international law, labour, ozone depletion sustainable development and international

trade. In 2004, he was awarded an Honorary Doctorate by Western University of Arad. Romania, in recognition

of his work in support of environment and development. A Distinguished Fellow at The Energy and Resources

Institute, New Delhi, the Chairman and Managing Trustee of two organisations serving the underprivileged,

CHIKITSA and SHIKSHA, as well as Chairman of the Nehru Trust for the Indian Collections at the Victoria

and Albert Museum and Chairman of the NAB India Centre for Blind Women and Disability Studies. He

frequently contributes to seminars on economic, environmental, defence, political, trade and security issues.

Mr. Malhotra is currently also a director of the Company.

Mr. Bharatendu Nath Srivastava joined as an Independent Director on ONGC Videsh’s Board on 15

September 2017. He received his Master’s degree in Psychology from Lucknow University in 1974 and his

Ph.D. in Psychology (specialised in Organisational Behaviour) from the Indian Institute of Technology Kanpur

in 1979. Mr. Srivastava is currently a Professor at the Indian Institute of Management, Calcutta where he has

A39729228 156

also trained, provided consultancy advice and directed many management development programmes of the

Indian Institute of Management, Calcutta. In addition, Mr. Srivastava has provided in-company training courses

across a wide range of firms in the private sector.

Mr. Rakesh Kacker joined as an Independent Director on ONGC Videsh’s Board on 15 September 2017.

He holds a Bachelor’s Degree in Economics from Hindu College, Delhi University and a Master’s Degree in

Economics from Delhi School of Economics, Delhi University. Mr. Kacker has taught economics at the

undergraduate level from 1974-1977 at Delhi University and thereafter joined the Indian Administrative Service

in 1977 where he held several assignments in various ministries of the Indian Government including Secretary,

Ministry of Food Processing Industries. Mr. Kacker is a member of the Governing Body of AIIMS Jodhpur, a

member of the Managing Committees of several schools of the Delhi Public School Society and a member of

two committees of the Indian Government (i.e. Expert Committee to review bidding documents for ultra mega

power projects and related issues for the Ministry of Power and the Expert Committee to review bidding process

for coal auctions for the Ministry of Coal). Mr. Kacker is currently also a director of PTC India Limited.

Ms. Kiran Oberoi Vasudev joined as an Independent Director on ONGC Videsh’s Board on 15

September 2017. She holds a Master’s degree in Human Geography from Delhi University, a Bachelor’s Degree

in Law from the University of Mumbai and attended various global training programme, such as the United

Nations Development Programme (UNDP) Fellowship for Tax Training in the United States and the Global Tax

Leadership Programme conducted by The Wharton School, University of Pennsylvania together with the Indian

Institute of Management, Bangalore. Ms. Vasudev is currently the Chairperson of the Quality Review Board of

the Institute of Company Secretaries of India. Ms. Vasudev has 35 years of experience in the Indian tax industry

where she previously served as the Principal Chief Commissioner of Income Tax, heading the capacity building

division there. In addition to tax administration, Ms. Vasudev also handled diverse portfolios, ranging from

information technology-based solutions to leading the Business Process Reengineering project of the income

tax department. Ms. Vasudev also served on an assignment to the Government of Maldives where she designed

the Tax Information Management System there. Ms. Vasudev was a member of the delegations to the revenue

administrations of the United States, United Kingdom and Malaysia. Ms. Vasudev is currently also a promoter

for Civic Innovation Foundation.

Special Invitees

All executive directors of the Company are special invitees to the Board of Directors of ONGC Videsh.

As of 31 March 2019, the Special Invitees from the Company were Mr. A. K. Dwivedi, Mr. Subhash Kumar,

Mr. Rajesh Kakkar, Mr. Sanjay Kumar Moitra, Mr. N. C. Pandey and Dr. Alka Mittal. See the section entitled

“Management” for information regarding each of the above mentioned special invitee directors.

Relationship between ONGC Videsh’s Directors

None of the Directors of ONGC Videsh are related to each other.

Directorships in other listed companies

None of the Directors of ONGC Videsh is or was a director on any listed company during the five years

preceding the date of this Offering Circular, whose shares have been or were suspended from being traded on

any stock exchange, during the term of their directorship in such company.

None of the Directors of ONGC Videsh is or was a director on any listed company which has been or

was delisted from any stock exchange during the term of their directorship in such company.

Borrowing Powers of the Board of Directors

The Board of Directors has been authorised by the shareholders of ONGC Videsh by a resolution dated

28 January 2014 to borrow money not exceeding Rs.500,000 million in excess of and in addition to the paid up

capital and free reserves of ONGC Videsh upon terms and conditions that it deems fit.

A39729228 157

BUSINESS

Overview

The Company was the largest oil and gas exploration and production company in India in terms of

production and reserves of oil and gas for the 2019 Fiscal Year according to the MoPNG.5 As of 31 July 2019,

the Company was also the largest central public sector enterprise in India in terms of market capitalisation

according to the Bombay Stock Exchange.6 The Company through its subsidiary ONGC Videsh engages in

exploration and production activities in 20 other countries, namely Azerbaijan, Bangladesh, Brazil, Colombia,

Iran, Iraq, Israel, Kazakhstan, Libya, Mozambique, Myanmar, Namibia, New Zealand, Russia, South Sudan,

Sudan, Syria, the United Arab Emirates (“UAE”), Venezuela and Vietnam. The Company also has integrated

downstream activities in India. Through its subsidiary MRPL, the Company owns and operates an oil refinery

in Mangalore with an installed capacity of 15.00 MMTPA (the “Mangalore Refinery”). The Company's

downstream portfolio was significantly enhanced following the Company’s acquisition of a 51.11 per cent.

majority equity interest in the state refining entity, Hindustan Petroleum Corporation Ltd (“HPCL”) on 31

January 2018 (the “HPCL Acquisition”). Through HPCL, the Company owns and operates two major

refineries which produce a wide variety of petroleum fuels and specialty products, with one refinery located in

Mumbai (West Coast) with a capacity of 7.50 MMTPA (the “Mumbai Refinery”) and the other refinery located

in Visakhapatnam (East Coast) with a capacity of 8.33 MMTPA (the “Visakh Refinery”). The Company is also

present across the hydrocarbon value chain with operations in refining, petrochemicals, power and LNG in

addition to its exploration and production activities.

According to the Platts Top 250 Global Energy Companies Rankings 2018 (which measures financial

performance by examining various companies’ assets, revenues, profits and return on invested capital), the

Company was ranked first globally among oil and gas companies in the exploration and production category

and was ranked 21st overall. Further, the Company was ranked 3rd largest in India and 160th on the 2019 Fortune

Global 500 List and 220th largest worldwide in the Forbes Global 2000 list of the world’s biggest companies

for 2019 based on sales, profits, assets and market capitalisation.

According to management’s internal estimates, the Company’s 1P, 2P and 3P crude oil and natural gas

reserves (excluding Sudan and South Sudan), as of 31 March 2019, were 971.98 MMtoe, 1,423.91 MMtoe and

1,520.00 MMtoe, respectively. According to management’s internal estimates, the Company’s 1P, 2P and 3P

crude oil and natural gas reserves in Sudan and South Sudan, as of 31 March 2019, were 19.40 MMtoe, 22.06

MMtoe and 27.14 MMtoe, respectively. These 1P, 2P and 3P reserves estimates cover the Company’s share of

all of the Company’s crude oil and natural gas assets, including the Company’s wholly-owned and operated

blocks, as well as its participating interests in joint venture operations, both in India and internationally. For the

2017 Fiscal Year, the 2018 Fiscal Year and the 2019 Fiscal Year, the Company’s share of total production from

domestic and international operations, including both operated and non-operated fields, aggregated 33.96 MMT

(252.59 MMbbls), 34.79 MMT (258.91 MMbbls) and 34.33 MMT (255.71 MMbbls) of crude oil, respectively,

and 27.64 BCM, 29.42 BCM and 30.55 BCM of natural gas, respectively. For the 2017 Fiscal Year, the 2018

Fiscal Year and the 2019 Fiscal Year, the Company’s consolidated gross revenues from operations were Rs.

3,256,662.21 million, Rs. 3,622,464.32 million and Rs. 4,534,605.67 million, respectively, and its consolidated

profit after tax was Rs. 291,691.19 million, Rs. 260,679.86 million and Rs. 338,869.29 million, respectively.

Domestic Exploration and Production

The Company conducts its domestic exploration and production activities through its independent

operations as well as in associations and joint ventures with other oil and gas companies, including Bharat

5 See https://www.ppac.gov.in/content/146_1_ProductionPetroleum.aspx for more details. 6 See http://www.bsepsu.com/mkt_capt.asp for more details.

A39729228 158

Petroleum Resources Limited (“BPRL”), Indian Oil Corporation Limited (“IOCL”), Oil India Limited

(“OIL”), GAIL (India) Ltd. (“GAIL”), Gujarat State Petroleum Corporation (“GSPC”), Vedanta Ltd. (formerly

known as Cairn India Limited), BP plc, and Videocon Industries Limited. The Company’s domestic production

(excluding production from fields operated through joint ventures and including production attributable to

minority participants in the Company’s domestic fields) represented 70.84 per cent. and 78.51 per cent. of

India’s total production of crude oil and natural gas, respectively, for the 2019 Fiscal Year.

As of 31 March 2019, the Company operated 345 nomination PML and nine PMLs under NELP regime,

crude oil and natural gas reserves bearing fields in India. The Company held interest in nine Pre-NELP Fields

as a joint venture partner in India. In addition, as of 31 March 2019, the Company held PELs for nine nominated

blocks, one Pre-NELP block, 19 NELP blocks and two OALP blocks in HELP regime. For the 2017 Fiscal Year,

the 2018 Fiscal Year and the 2019 Fiscal Year, the Company’s share of total domestic production aggregated

was 25.53 MMT (191.48 MMbbls), 25.44 MMT (190.80 MMbbls) and 24.23 MMT (181.73 MMbbls) of crude

oil, respectively, and 23.27 BCM, 24.61 BCM and 25.81 BCM of natural gas, respectively. For the 2017 Fiscal

Year, the 2018 Fiscal Year and the 2019 Fiscal Year, the Company’s share of domestic average daily production

was approximately 512,779 barrels per day, 510,791 barrels per day and 486,612 barrels per day of crude oil,

respectively, and 63.75 MMCM per day, 67.42 MMCM per day and 70.71 MMCM per day of natural gas,

respectively.

International Exploration and Production

The Company carries out its international exploration and production activities through its subsidiaries,

including ONGC Videsh, through independent operations, as well as through associations and joint ventures

that the Company undertakes with other oil and gas companies, including IOCL, OIL, ExxonMobil, British

Petroleum, China National Petfroleum Company International (“CNPC”), Petronas Carigali Nile Limited

(“Petronas”), Petrobras Brasileiro S.A., Shell, Ecopetrol S.A, Repsol S.A., Sinopec International Petroleum

Exploration and Production Corporation, Statoil Oil and Gas AS, Chevron Corporation, Qatar Petroleum,

Anadarko Petroleum Corporation, Rosneft Oil Company, Petroleos de Venezuela SA, SOCAR and

Kazmunaigas. As of 31 March 2019, the Company held participating interests in 41 projects across 20 countries,

namely Azerbaijan, Bangladesh, Brazil, Colombia, Iran, Iraq, Israel, Kazaksthan, Libya, Mozambique,

Myanmar, Namibia, New Zealand, Russia, South Sudan, Sudan, Syria, UAE, Venezuela and Vietnam,

comprising 15 producing projects, 18 exploration blocks, four discovered/development blocks and four pipeline

projects.

For the 2017 Fiscal Year, the 2018 Fiscal Year and the 2019 Fiscal Year, the Company’s total

international production was 8.43 MMT (61.11 MMbbls), 9.35 MMT (68.11 MMbbls) and 10.10 MMT (73.98

MMbbls) of crude oil, respectively, and 4.37 BCM, 4.81 BCM and 4.74 BCM of natural gas, respectively. For

the 2017 Fiscal Year, the 2018 Fiscal Year and the 2019 Fiscal Year, the Company’s international average daily

production was approximately 167,413 barrels per day, 186,610 barrels per day and 202,678 barrels per day of

crude oil, respectively, and 11.97 MMCM per day, 13.18 MMCM per day and 12.98 MMCM per day of natural

gas, respectively.

Refineries

The Company conducts downstream refining and marketing operations in India. Prior to the HPCL

Acquisition, the Company’s downstream refining and marketing operations were conducted primarily through

its subsidiary MRPL, which operates the Mangalore Refinery. for the 2017 Fiscal Year, the 2018 Fiscal Year

and the 2019 Fiscal Year, MRPL processed 16.27 MMT (118.67 MMbbls), 16.31 MMT (118.91 MMbbls) and

16.43 MMT (118.77 MMbbls) of crude oil, respectively.

The HPCL Acquisition significantly transformed the Company’s downstream portfolio and provides a

platform for the Company, as a vertically integrated oil company, to achieve significant economies of scale,

A39729228 159

diversify its cash flows and mitigate the impact of volatile crude oil prices on its operations. Through its HPCL,

the Company operates the Mumbai Refinery and the Visakh Refinery which produce a wide variety of

petroleum fuels and specialty products. For the 2017 Fiscal Year, the 2018 Fiscal Year and the 2019 Fiscal Year,

HPCL processed 17.81 MMT (133.58 MMbbls), 18.28 MMT (137.10 MMbbls) and 18.44 MMT (138.30

MMbbls) of crude oil, respectively. As a result of the HPCL Acquisition, the Company’s refining capacity

increased from 15.00 MMTPA (112.50 MMbbls) as of 31 March 2018 to 30.83 MMTPA (231.23 MMbbls) as

of 31 March 2019, which represents approximately 12.36 per cent. of India’s total refining capacity as of 31

March 2019.7 HPCL also owns and operates the largest lubricant refinery in India, which produces lubricant

base oils and has a capacity of 428 TMT. Based on management’s internal estimates, the lubricant refinery

accounts for over 40.00 per cent. of India’s total lubricant base oil production as of 31 March 2019. Furthermore,

HPCL operates, in conjunction with Mittal Energy Investments Pte. Ltd, a refinery in Bathinda with a capacity

of 11.3 MMTPA (the “GGS Refinery”). For the 2018 Fiscal Year and the 2019 Fiscal Year, HPCL recorded

non-consolidated sales revenue of Rs. 2,432,267 million and Rs. 2,957,126 million, respectively, and profit

after tax of Rs. 63,571 million and Rs. 60,287 million, respectively.

Other projects

The Company is engaged in other downstream segments of the hydrocarbon value chain, including its

petrochemicals business. ONGC Petro-additions Limited (“OPaL”), a joint venture of the Company, operates

a 1.1 MMTPA ethylene cracker unit owned by the Company and is one of the largest dual-feed crackers in the

world. ONGC Mangalore Petrochemicals Limited (“OMPL”), another petrochemical unit of the Company, was

commissioned on 1 October 2014 and has a production capacity of 1.2 MMTPA. As of the date of this Offering

Circular, approximately 84.55 per cent. of OMPL’s products, namely paraxylene and benzene, are exported to

other countries. The Company also operates a 726.6 MW gas-based combined cycle power plant at Palatana in

Tripura through one its joint ventures, ONGC Tripura Power Company Limited (“OTPC”).

The Company is also involved in alternative energy projects, including research and development in

shale gas, the development of coalbed methane, a pilot project for underground coal gasification and the

operation of land wind farm projects and solar power projects.

Awards and Accolades

The Company was awarded the “Best Project of the Year 2017” by Project Management Institute

(“PMI”), India for its Additional Development of Vasai East Project at the PMI Annual Conference on 16

September 2017. The Company received the Dun and Bradstreet Corporate Award in the Oil and Gas

Exploration Sector during the 11th Dun and Bradsheet Corporate Awards ceremony on 1 June 2017. The

Company was also named “Exploration and Production – Company of the year” and “Environmental

Sustainability – Company of the Year” during the Federation of Indian Petroleum Industry awards in 2017. In

2018, the Company reclaimed the Dun and Bradstreet Corporate Award in the Oil and Gas Exploration Sector

during the 12th Dun and Bradsheet Corporate Awards, was awarded the “INFRA Icon Award” in the Global

Energy category during the mid-day INFRA Icons Awards 2018 and received the “Golden Peacock Award for

HR Excellence” whilst ONGC Videsh received “Golden Peacock Award for Risk Management” from the

Institute of Directors. The Company was awarded the “Best Innovative Practices Award” for Women at

Workplace at the 2nd Gender Equality Summit organised by Global Compact Network India in March 2019.

The Company’s corporate social responsibility programmes received the “FICCI Award” from the Federation

of Indian Chambers of Commerce and Industry on 19 February 2019 for its corporate social responsibility

projects in Baramulla and Uri of Jammu and Kashmir.

7 See http://petroleum.nic.in/refining/about-refining for more details.

A39729228 160

The Company’s subsidiary, MRPL, received various accolades, including the Silver Medal in the “India

Green Manufacturing Challenge 2017 by IRIM”, Runners Up (under the PSU Manufacturing Category 2018)

at the “BML Munjal Award – For Excellence through Learning and Development”, Platinum Trophy at the

“Greentech Environment Award 2018”, the “Srishti-Good Green Governance” Award (under the Manufacturing

Category 2018) and the Employee Productivity Award 2018 at the “Governance Now’ PSU Awards”. MRPL

was also recognised as the highest export performer at the International Customs Day Mangalore 2019.

The Company’s subsidiary, HPCL, also received nationwide recognition and has been awarded various

accolades. These include the “Oil Marketing Company of the Year” Award by the Federation of Indian

Petroleum Industry for the third consecutive year for leadership in oil marketing business in India in 2019, the

“Forecourt Retailer of the Year” Award for the 11th time at Star Retailer Awards 2018, the “Industrial Innovation

Award 2018” to HPCL’s research and development centre in Bengaluru by the Confederation of Indian

Industries and the “Vigilance Excellence Award 2018” in the outstanding category for ‘Best Institutional

Practices’ by the Central Vigilance Commission. HPCL has also been recognised amongst “Top Three Best

Performing CPSEs (Oil and Gas)” for contribution towards ‘Swachhta Pakhwada’ by the MoPNG.

Recent Developments

On 13 August 2019, the Company published its unaudited and reviewed consolidated financial

statements for the three months ended 30 June 2019 and its unaudited and reviewed non-consolidated financial

statements for the three months ended 30 June 2019. For more information, please see (a) the unaudited and

reviewed consolidated financial statements of the Company for the three months ended 30 June 2019 and the

unaudited and reviewed non-consolidated financial statements of the Company for the three months ended 30

June 2019 and their respective notes thereto which are included elsewhere in this Offering Circular and (b) the

section entitled “Presentation of financial and other information”.

Competitive Strengths

The Company believes that its historical success and future prospects are directly related to a

combination of the following competitive strengths:

The only fully integrated oil and gas company in India

The Company is the only fully integrated oil and gas company in India with a leading market position in

the Indian upstream market and dominant position in the downstream market, providing for full integration

across the oil and gas value chain.

Leading upstream oil and gas player in India

The Company has the largest crude oil and natural gas reserves, exploration area and production

capability among Indian oil and gas companies engaged in exploration and production.

(i) Reserves: The Company has the largest proved reserves in India of any oil and gas company, according

to the Indian Petroleum and Natural Gas Statistics Report — 2017-2018 by the MoPNG. The Company

believes that its reserves provide it with an abundant and stable long-term source of hydrocarbons for

crude oil and natural gas production.

According to management’s internal estimates, the Company’s 1P, 2P and 3P crude oil and natural gas

reserves (excluding Sudan and South Sudan), as of 31 March 2019, were 971.98 MMtoe, 1,423.91

MMtoe and 1,520.00 MMtoe, respectively. According to management’s internal estimates, the

Company’s 1P, 2P and 3P crude oil and natural gas reserves in Sudan and South Sudan, as of 31 March

2019, were 19.40 MMtoe, 22.06 MMtoe and 27.14 MMtoe, respectively. These estimates include (i)

345.78 MMtoe, 675.72 MMtoe and 706.67 MMtoe of 1P, 2P and 3P reserves, respectively relating to

the Company’s international fields, and (ii) 645.60 MMtoe, 770.26 MMtoe and 840.47 MMtoe of 1P, 2P

A39729228 161

and 3P reserves, respectively, relating to the Company’s domestic fields (including joint ventures), and

cover the Company’s share of all of the Company’s crude oil and natural gas assets, including the

Company’s 100.00 per cent. owned and operated blocks, as well as its participating interests in joint

venture operations.

The Company focuses on reserves accretion through its exploration and development activities. The

Company strives to maintain a reserve replacement ratio, meaning a ratio greater than 1.0. Based on

management’s internal estimates, the Company achieved an 1P oil and oil equivalent gas reserve

replacement ratio greater than 1.0 in its Company-operated domestic fields for the 2007, 2008, 2010,

2012, 2013, 2017 and 2019 Fiscal Years. The Company also achieved a 2P oil and oil equivalent gas

reserves replacement ratio greater than 1.0 for the period from the 2007 Fiscal Year to the 2019 Fiscal

Year in its Company-operated domestic fields.

(ii) Exploration Area: As of 31 March 2019, the Company owned and operated nine nomination

exploration blocks covering an aggregate area of approximately 36,833 sq. km. In addition, the Company

is undertaking exploration activities in 19 NELP blocks covering an area of approximately 22,533 sq.

km, one Pre-NELP block covering an area of approximately 892 sq. km and two OALP blocks covering

an area of approximately 1,456 sq. km. As of 31 March 2019, the Company held as operator one pre-

NELP on-land block. The Company believes that its strong operational capabilities and financial position

enable it to pursue these exploration opportunities.

(iii) Production: The Company was the largest producer of crude oil and natural gas in India for the 2019

Fiscal Year. For the 2017 Fiscal Year, the 2018 Fiscal Year and the 2019 Fiscal Year, the Company’s

share of total domestic production aggregated 25.53 MMT (191.48 MMbbls), 25.44 MMT (190.80

MMbbls) and 24.23 MMT (181.73 MMbbls) of crude oil, respectively, and 23.27 BCM, 24.61 BCM and

25.81 BCM of natural gas, respectively. For the 2017 Fiscal Year, the 2018 Fiscal Year and the 2019

Fiscal Year, the Company’s share of domestic average daily production was approximately 512,779

barrels per day, 510,791 barrels per day and 486,612 barrels per day of crude oil, respectively, and 63.75

MMCM per day, 67.42 MMCM per day and 70.71 MMCM per day of natural gas, respectively.

Dominant downstream oil and gas player in India with a strong presence across the hydrocarbon value

chain

The Company’s comprehensive downstream portfolio complements its upstream strengths. The

Company has a strong presence across the hydrocarbon value chain. The Company’s operations include the

operation of refineries, extraction of value added products such as C2 (ethane) – C3 (propane) – C4 (butane),

liquefied petroleum gas (“LPG”), naphtha, superior kerosene oil, aviation turbine fuel and high-speed diesel of

marine grade from gas and Condensate streams.

(i) Refineries: Following the HPCL Acquisition, the Company's downstream portfolio was significantly

transformed and provides a platform for the Company, as a vertically integrated oil company, to achieve

significant economies of scale, diversify its cash flows and mitigate the impact of volatile crude oil prices

on its operations. Through its subsidiaries MRPL and HPCL, the Company owns and operates the

Mangalore Refinery, the Mumbai Refinery and the Visakh Refinery. As of 31 March 2019, the

Company’s refining capacity was 30.83 MMTPA (231.00 MMbbls) representing approximately 12.35

per cent. of India’s total refining capacity as of 31 March 2019. In addition, the Company, through HPCL

(a) owns and operates the largest lubricant refinery in India with a capacity of 428 TMT and accounted

for over 40 per cent. of India’s total lubricant base oil production as of 31 March 2019 based on

management’s internal estimates and (b) operates, in conjunction with Mittal Energy Investments Pte.

Ltd, the GGS Refinery which as a capacity of 11.3 MMTPA. HPCL is also currently in the process of

establishing a new 9 MMTPA capacity greenfield refinery cum petrochemical complex at Pachpadra in

A39729228 162

Barmer District of Rajasthan (the “Pachpadra Refinery”) through a joint venture company, HPCL

Rajasthan Refinery Limited (“HRRL”). For the 2017 Fiscal Year, the 2018 Fiscal Year and the 2019

Fiscal Year, the Company processed 34.08 MMT (252.25 MMbbls), 34.59 MMT (256.01 MMbbls) and

34.87 MMT (257.07 MMbbls) of crude oil, respectively.

(ii) Value Added Products and others: The Company is also engaged in petrochemicals and other segments

of the hydrocarbon value chain, which include the following:

the Company held, as of 31 March 2019, a 12.50 per cent. equity interest in Petronet LNG Limited

(“Petronet LNG”), which owns and operates a 15 MMTPA LNG receiving and regasification

terminal at Dahej and an additional five MMTPA regassification terminal at Kochi, Kerala;

the Dahej Special Economic Zone Limited (“DSEZ”) is a multi-product special economic zone

at Dahej in coastal Gujarat with world-class mega infrastructure facilities. The special economic

zone is fully operational and through Dahej Special Economic Zone Limited (“DSEZL”), the

Company operates a C2-C3 Extraction Plant and a value-chain integration project located in this

special economic zone. As of 31 March 2019, the Company and Gujarat Industrial Development

Corporation each had an equity interest of 50.00 per cent. in DSEZL;

OPaL is a joint venture among the Company, GAIL and GSPC. As of 31 March 2019, the

Company held a 49.36 per cent. equity interest in OPaL. OPaL is a mega petrochemical project

in DSEZ which comprises a 1.10 MMTPA Ethylene Cracker and was established to utilise C2-

C3 gas feed and Naphtha from the Company’s nearby extraction C2-C3 extraction plant at Dahej

and Naphtha from gas processing plants at Hazira. The Polymer plants of OPaL consist of two

360 kilo-tonnes per annum (“KTPA”) of LLDPE/HDPE swing units, one 340 KTPA of dedicated

HDPE and one 340 KTPA of PP. The project was inaugurated by the Prime Minister of India in

March 2017 and began producing petrochemical products such as Polypropylene, HDPE,

LLDPE, Butadiene and Benzene in the 2017 Fiscal Year; and

OMPL is a subsidiary of MRPL and as of 31 March 2019, the Company and MRPL held a 48.99

per cent. and 51.00 per cent. equity interest respectively. OMPL is a value-chain integration

project for manufacturing para-xylene (0.92 MMTPA capacity) and benzene (0.28 MMTPA

capacity) from the aromatic streams of MRPL. The complex is designed to produce 914 KTPA

of high purity para-xylene and around 283 KTPA of high purity Benzene products which are sold

internationally. This complex is licensed by Universal Oil Products Ltd., a pioneer in

petrochemical technology. OMPL started its commercial production since 2014 and has been

progressively increasing its capacity utilisation.

The Company is also involved in alternative energy projects, including research and development in

shale gas, the development of coalbed methane, a pilot project for underground coal gasification and the

operation of land wind farms and solar power projects.

(iii) Pipeline and Distribution Network: The Company has an extensive downstream infrastructure and

pipeline network in India. The Company, through Petronet MHB Limited (“PMHBL”), operates a cross-

country petroleum products pipeline of 362.37 km that allows the transportation of a variety of finished

petroleum oil products from MRPL located in Mangalore. The Company through HPCL, operates a

petroleum product pipeline network of 3,370 km with mainline capacity of 24.93 MMTPA and branch

line capacity of 11.07 MMTPA as of 31 March 2019. Pipeline network expansion remains a major focus

area for the Company and a number of large scale expansion projects are underway with an estimated

investment of Rs. 5,916 crore. These projects are expected to increase the mainline capacity to 33.70

MMTPA and network length to approximately 4,500 km and significant strengthen the Company's

A39729228 163

position in key markets. For the Fiscal Year 2019, pipeline project for capacity expansion of

Ramanmandi Bahadurgarh pipeline from 4.71 MMTPA to 7.11 MMTPA was completed as per the

scheduled timelines. The Company’s, through HPCL, major ongoing pipeline infrastructure projects

include: (a) capacity expansion of Mundra Delhi pipeline from 5 MMTPA to 6.9 MMTPA along with

extension of branch pipeline from Palanpur to Vadodara (235 km) and construction of green field

marketing terminal at Vadodara, (ii) capacity expansion of Visakh Vijayawada Secunderabad pipeline

(“VVSPL”) from 5.38 MMTPA to 7.7 MMTPA (iii) extension of VVSPL from Vijayawada to

Dharmapuri (697 km) and construction of marketing terminal at Dharmapuri and (iv) Uran Chakan

Shikrapur LPG pipeline (168 km) of 1 MMTPA capacity. The Company, through HPCL, is also

participating in development of India’s longest LPG pipeline from Kandla to Gorakhpur (2,757 km)

along with IOCL and Bharat Petroleum Corporation Limited. In addition, the Company through HPCL

has an extensive retail presence covering over 15,000 outlets in India and a vast marketing network of

21 zonal offices in major cities and 128 regional offices supported by extensive supply and distribution

infrastructure consisting of terminals, pipeline networks, aviation service stations, LPG bottling plants,

inland relay depots, retail outlets, and lubricant and LPG distributorships.

Increasing international reserves and production

For the 2017 Fiscal Year, the 2018 Fiscal Year and the 2019 Fiscal Year, the Company’s total

international production was 8.43 MMT (61.11 MMbbls), 9.35 MMT (68.11 MMbbls) and 10.10 MMT (73.98

MMbbls) of crude oil, respectively, and 4.37 BCM, 4.81 BCM and 4.74 BCM of natural gas, respectively. For

the 2017 Fiscal Year, the 2018 Fiscal Year and the 2019 Fiscal Year, the Company’s international average daily

production was approximately 167,413 barrels per day, 186,610 barrels per day and 202,678 barrels per day of

crude oil, respectively, and 11.97 MMCM per day, 13.18 MMCM per day and 12.98 MMCM per day of natural

gas, respectively. The Company also focuses on international reserves accretion through independent efforts

towards international discoveries and acquisitions, as well as through partnerships and joint ventures in

producing assets. As of 31 March 2019, the Company estimates that its 1P, 2P and 3P crude oil and natural gas

reserves were 345.78 MMtoe, 675.72 MMtoe and 706.67 MMtoe, respectively.

The Company’s international reserves and exploration blocks are located in various countries, including

Azerbaijan, Bangladesh, Brazil, Colombia, Iran, Iraq, Israel, Kazaksthan, Libya, Mozambique, Myanmar,

Namibia, New Zealand, Russia, South Sudan, Sudan, Syria, UAE, Venezuela and Vietnam. As of 31 March

2019, the Company held participating interests in 41 projects across 20 countries, comprising 15 producing

projects, 18 exploration blocks, four discovered/development blocks and four pipeline projects.

Technological capabilities in sustaining production from mature fields

The Company deploys a wide array of secondary recovery, artificial lift, improved oil recovery and

enhanced oil recovery techniques and strives to achieve maximum recovery from its crude oil reserves, which

derive mainly from mature fields, particularly in India. As part of the Company’s reservoir management

strategy, the Company employs these techniques from a relatively early stage in the life of oil fields to enhance

recovery. The Company believes these measures have enabled it to arrest the decline in production of its mature

domestic fields. The Company has also entered into a joint venture with the Energy and Resources Institute

(“ERI”) to combine its technical expertise and research capabilities in order to further increase the efficiency

of its crude oil recovery operations.

Crude oil and natural gas exploration experience and capabilities, including best-in-class

infrastructure and facilities

Since its incorporation, the Company has gained substantial exploration, development and production

expertise, in particular with respect to the geological conditions in India. The Company believes that it has

accumulated a large collection of raw and proprietary geological data relating to offshore and onshore regions

A39729228 164

in India, where such knowledge and database represent a competitive advantage over other foreign and domestic

oil and gas companies that compete with the Company in India for exploration, development and production

acreage. In addition, the Company’s knowledge and experience in India enables it to attract prospective joint

venture and production-sharing partners, which further strengthens the Company’s ability to pursue domestic

exploration, development and production opportunities, and to obtain access to advanced technologies and

techniques through such joint ventures and production-sharing partners. The Company also benefits from its

skilled workforce and senior management team that has significant industry experience.

The Company’s average Finding Costs and all-in production costs benefit from its low manpower costs,

relatively high use of in-house services, utilisation of depreciated infrastructure and equipment and effective

use of its large base of geological data and expertise. The Company believes that its cost structure enables it to

compete effectively even in an environment of low crude oil prices. The Company has installed various

infrastructures, including drilling and work-over rigs, onshore and offshore production facilities, subsea and

land pipelines, gas processing and fractionation facilities, exploration and transport vessels, storage facilities

and other infrastructure located throughout the principal oil and gas-producing regions of India.

The Company seeks to continually update its existing technology, as well as develop and adopt new and

improved technology in the exploration, development, production, refining and other areas of its business. The

Company’s research and development institutes form an integral part of its business and are instrumental in

providing much of the technological and analytical support and scientific, engineering and technical know-how

that are critical to the Company’s business. Similarly, the Company’s affiliated training institutes provide

educational services and skills training to effectively develop the Company’s human resources and maintain its

competitive edge. The Company has established several oil and gas research and development institutes,

including the Keshava Deva Malaviya Institute of Petroleum Exploration, the Geodata Processing and

Interpretation Centre, the Institute of Drilling Technology, the Institute of Reservoir Studies, the Institute of Oil

and Gas Production Technology, the Institute of Engineering and Ocean Technology, the ONGC Academy, the

Institute of Petroleum Safety, Health and Environment Management, the School of Maintenance Practices,

Centre for Excellence in Well Logging, ONGC Energy Centre Trust, the Institute of Biotechnology and

Geotectonic Studies and regional training institutes in Chennai, Mumbai, Shivasagar and Vadodara. These

institutes also leverage research through international and national consortia, alliances and joint industry

programmes.

Strategy

The Company’s significant transformation in the last decade has seen the Company progress from being

a largely India-centric oil and gas producer to one that produces assets across the world with capabilities in both

the upstream and downstream segments of the oil and gas industry. In April 2019, the Company adapted its

strategic blueprint for the future with a new strategic plan (the “ONGC Energy Strategy 2040”). The ONGC

Energy Strategy 2040 represents an important milestone for the Company as it gears up, as the country’s

foremost national oil corporation in oil and gas, for the opportunities and challenges of the emerging world and

domestic energy order for the next couple of decades. The ONGC Energy Strategy 2040 builds on the primary

ideals and objectives of the Company’s previous strategic plan (the “Perspective Plan 2030”) while remaining

alive to the evolving dynamics of an energy world that is in transition.

In line with the ONGC Energy Strategy 2040, the Company, inter alia, strives to explore many

opportunities for sustaining the Company’s growth and fulfilling its vision of becoming a global energy leader.

The Company intends to employ the following strategies to achieve its objectives pursuant to the Energy

Strategy 2040.

A39729228 165

Increase domestic exploration, development and production efforts

As of 31 March 2019, the Company held one deep-water NELP block and four deep-water nomination

blocks and the Company intends to intensify its exploration and development efforts, primarily through

expansion of its deep-water exploration activities in India. The Company’s deep-water programme involves the

deployment of drilling ships and includes the involvement of consultants for geological and geophysical studies,

and deep-water drilling, technology, testing and completion services. In addition to its deep-water programme,

the Company intends to increase its efforts to explore existing shallow water offshore basins, as well as explored

and unexplored onshore basins, and participate in the auction of blocks in the future. For the 2017 Fiscal Year,

the 2018 Fiscal Year and the 2019 Fiscal Year, the Company’s non-consolidated expenditure for seismic

surveys, exploration drilling and development drilling was Rs. 182,759.92 million, Rs. 167,977.88 million and

Rs. 177,901.61 million, respectively.

Improved oil and gas recovery and gas utilisation levels in producing properties

Crude Oil

The Company seeks to implement a number of advanced recovery technologies to redevelop its maturing

fields and improve recovery of its crude oil reserves, with the goal of substantially increasing its current

recovery rates. These measures include the greater use of extended-reach horizontal drilling, side tracks, in-fill

drilling and water injection, as well as technologies using chemical and thermal methods to enhance oil

recovery.

The Company has 29 improved oil recovery and enhanced oil recovery and redevelopment schemes in

15 major fields (onshore and offshore) of which 25 schemes have been completed and four are currently under

implementation. As of 31 March 2019, the Company had spent approximately Rs. 513,557 million against a

planned investment of Rs. 609,083 million. Through these improved oil recovery and enhanced oil recovery

schemes, the Company has received a cumulative incremental gain of approximately 126.47 MMT through 31

March 2019. In addition, the Company also intends to increase the use of various enhanced oil recovery

techniques to extend crude oil production peak periods, mitigate future decline rates and potentially accelerate

crude oil production.

Gas

The Company seeks to further improve its natural gas utilisation through the reduction of gas flaring,

principally through the implementation of advanced technology and techniques and the upgrading and

expansion of the natural gas distribution network from its gas-bearing domestic fields.

Augment international reserves and production

The Company seeks to increase its production of crude oil, natural gas and value-added products by

significantly expanding its international presence. The Company intends to increasingly focus on joint

participation with other international exploration and production companies in producing assets through PSCs.

In addition to the Company’s current international producing assets in foreign countries including Azerbaijan,

Bangladesh, Brazil, Colombia, Iran, Iraq, Kazakhstan, Libya, Mozambique, Myanmar, New Zealand, Russia,

South Sudan, Sudan, Syria, Venezuela and Vietnam, the Company recently expanded its operations to projects

in Israel, Namibia and UAE.

The Company intends to exploit its existing overseas exploration and production acreage, pursue

opportunities to acquire or obtain participation interests in additional assets and obtain exploration and

development concessions in various overseas locations. In those geographic areas where it has limited

experience and expertise, the Company intends to structure its investments as joint ventures, alliances or

partnerships with entities possessing relevant experience and expertise.

A39729228 166

Continue to capture value through forward integration

The Company will continue to pursue its strategy of forward integration by unlocking value through

portfolio integration and downstream consolidation to strengthen its downstream market position, complement

its upstream market strengths and diversify its sources of revenue. These in turn will enable the Company to

maximise revenue from its crude oil and natural gas production by adding and extracting value through

petrochemical feedstock and expanding into downstream sectors such as refining, processing, distribution and

retailing. The Company believes that there are six key value levers in the upstream and downstream portfolio

integration which it will strive to achieve in the long term:

hydrocarbon flows (e.g.: crude placement, optimisation of refineries for crude slates);

optimisation of margins through centralised trading;

integrated capital allocation and investment decisions;

integration of systems and processes (e.g.: scale economies in procurement, technology and share

services);

sharing of infrastructure and assets (i.e. utilities, facilities and others); and

people and capability sharing and knowledge transfer.

In addition, the integration of downstream businesses will position the Company to unlock value through

synergies across centralised planning, value chain optimisation, achieving a unified market approach with a

centralised and share systems and processes.

The HPCL Acquisition was a significant milestone in the Company’s downstream market position and

the Company will continue to pursue synergistic forward integration acquisitions or developments where the

opportunity arises and thereby reinforce the Company’s integrated energy strategy.

Continue to maintain high environmental and safety standards

The Company is committed to ensuring safe operations and safeguarding the environment. As of 31

March 2019, the Company has registered 15 clean development mechanism (“CDM”) projects with the United

Nations Framework Convention on Climate Change, with an estimated emission reduction potential of

2,102,769 Certified Emission Reductions (“CERs”) per year. The ONGC Tripura Power Company’s natural

gas-based combined cycle power plant is one of the largest CDM projects in the world, with an estimated

emission reduction potential of 1,612,506 CERs. per annum. In 2018, the Company ranked 283rd in corporate

environmental performance by Newsweek Green Ranking for the year 2017. The Company is also in the process

of validating and registering four new CDM projects to its CDM portfolio, for the 2020 Fiscal Year.

The Company has also received quality, health, safety and environment certificates from the

International Organization for Standardization (“ISO”), an independent, non-governmental international

organisation headquartered at Geneva. As such, all the Company’s installations are certified under the relevant

quality, health, safety and environment standards. The Company also has crisis management teams that are

responsible for managing crisis situations resulting that may arise in the Company’s operations. The Company

was awarded the Maharatna status from the Indian Government in 2010 and in 2014, the Company was listed

on the Fortune Magazine’s Most Admired Companies List. ONGC Videsh was awarded the “Golden Peacock

Award for Risk Management” and the “Strategic Performance Award at Governance Now PSU Awards” in 2017

and the “Golden Peacock Award for Risk Management”, the “Best Risk Management Framework and Systems

– Risk Technology” at the 4th edition of The India Risk Management Award, the “Strategic Investment Award

at Governance Now PSU Awards in Miniratna-I category” and the “SKOCH Oil and Gas Platinum award for

Technology” in International Exploration and Production in 2018.

A39729228 167

The Company continues to strive to maintain high standards of occupational health, safety and

environmental protection. Due to the nature of its operations, the Company intends to continue conducting

internal and external audits to ensure compliance with health, safety and environmental protection norms, and

to maintain effective waste management practices.

Focus on the production, exploration and development of non-conventional energy and renewable

energy

Recognising that the share of renewables in the energy mix has been on the rise globally and domestically

due to cost competitiveness, climate change awareness and strong regulatory incentives, the Company will

continue its focus on the production, exploration and development of non-conventional energy sources

including coalbed methane, underground coal gasification, shale gas and gas hydrate, as well as renewable

energy sources such as wind power and solar power, which in turn will help the Company to build its long term

optionality in its portfolio and hedge against potential disruption. In the long-term, the Company intends to

build up a 5 to 10 GW capacity portfolio of renewable energy with a particular focus on wind energy. Since

2010, the Company has been engaged in several initiatives and projects involving such non-conventional energy

sources and renewable energy sources, which include the following:

commenced non-commercial coalbed methane production from its Jharia coalbed methane block in

Jharkhand in January 2010 and discovered shale gas in the Damodar Valley Raniganj block in West

Bengal in January 2011;

began its shale gas/oil exploration programme in 2010 with a pilot shale gas drilling programme in

Damodar Valley under a special dispensation from the Indian Government;

commenced its underground coal gasification efforts including undertaking a pilot project in the Vastan

Mine block in the Surat district of Gujarat;

operating in the states of West Bengal and Jharkhand in Eastern India for Coal Bed Methane (“CBM”)

development activities;

actively pursuing research on gas hydrates under National Gas Hydrate Program of India and has

successfully discovered two gas hydrate reservoirs in Krishna-Godavari deep water in the eastern

offshore;

commissioned a 51 MW on-land wind farm in 2008 at Kutch, Gujarat and a 102 MW on-land wind farm

in 2015 at Jaisalmer, Rajasthan; and

is in the process of uranium extraction and is exploring the feasibility of establishing a nuclear power

project, regarding which it has had preliminary discussions with the Nuclear Power Corporation of India

Limited.

The Company has also taken up research and development in clean and alternative sources of energy through

its ONGC Energy Centre which is engaged in in-house research, through its own scientists/research teams as

well as collaborative projects jointly taken up with some of the leading national academic and research

institutions. The Company’s renewable energy production capacity was further enhanced following the HPCL

Acquisition with its portfolio further extended to include land wind farms with a total capacity of 100.90 MW

in the states of Rajasthan (including the 50.40 MW land wind farm commissioned in December 2016) and

Maharashtra, a grid connected solar plant in Chennai which has approximately 22.60 MWP of installed captive

solar power capacity as of 31 March 2019. Going forward, the Company will continue its commitment to the

production, exploration and development of non-conventional energy sources and renewable energy sources.

A39729228 168

The Company’s Business

The Company traces its history to the establishment of the Commission. In October 1959, the

Commission was converted into a statutory body by an act of Parliament. The Commission commenced offshore

seismic surveys in the Gulf of Cambay in 1963. In 1993, the Indian Government proposed to transfer all the

assets, movable and immovable properties, contracts, licences and privileges stood vested with the Commission

to a Company to be incorporated for this purpose. Accordingly, the Company was incorporated on 23 June 1993

as Oil and Natural Gas Corporation Limited pursuant to the Companies Act, 1956. Subsequently, all the assets,

movable and immovable properties, contracts, licences and privileges stood vested with the Commission were

transferred to the Company on 1 February 1994.

The following chart summarises the Company’s structure as at 31 March 2019.

Exploration and Production Business

Crude Oil and Natural Gas Reserves

A majority of the Company’s domestic reserves are located offshore, primarily in the offshore fields

along the western continental shelf of India and in the Krishna-Godavari basin off the eastern coast of Andhra

Pradesh. The Company holds additional offshore reserves located in the Cauvery basin extending from the

south-eastern coast of India and in the Kutch basin in the Arabian Sea along the north-western coast of India.

The Company’s onshore reserves are primarily concentrated in the Cambay basin in the state of Gujarat in

western India, in the Assam and Assam-Arakan basin in the northeast of India and in the onshore portion of the

Krishna-Godavari basin in Andhra Pradesh. The Company has additional onshore reserves in the Cauvery basin

in Tamilnadu, in the Jaisalmer basin in Rajasthan, in the Bengal on-land in West Bengal and in the Vindhyan

basin in Madhya Pradesh. As of 31 March 2019, the Company had interests in a total of 345 PMLs (nominated)

and nine PMLs (NELP) in domestic fields.

A39729228 169

Presentation of Reserves Estimates

The Company estimates its reserves annually on 1 April of each year. These management internal

estimates are approved by the Reserve Estimate Committee (“REC”), which includes all basin managers, asset

managers, heads of all exploration institutes and other relevant members and is chaired by the Director

(Exploration), who has more than 38 years of experience and holds a Post-Graduate degree from Kanpur

University and has authored many technical papers. For the Company’s domestic operations through joint

ventures, reserves estimates are approved by the management committee of the relevant joint venture, which

consist of the Company’s representatives and representatives of the other joint venture partners, the Directorate

General of Hydrocarbons and the operator and are adopted by the Reserve Estimate Committee (“REC”) with

reference to the Company’s equity interest in the respective joint ventures. The Company’s domestic reserves

(other than domestic reserves held through joint ventures) are typically audited independently every five years.

The last independent audit of the Company’s domestic reserves at its major fields (representing 73.82 per cent.

of total reserves of Company-operated fields) was carried out for the year 2017 to 2018. See “Investment

Considerations — Risks relating to the Company’s Business — The Company’s crude oil and natural gas

reserves estimates involve a degree of uncertainty and may not prove to be correct over time. Moreover, these

estimates may be unaudited or may not be fully audited and may not accurately reflect actual reserves, or even

if accurate, technical limitations may prevent the Company from producing crude oil or natural gas from these

reserves”.

For its domestic reserves, the Company used internally developed definitions up to 1 April 2018. These

internally developed definitions were in part based on the reserves estimation definitions under the SPE 1987

Standards specified by the Society of Petroleum Engineers (SPE). The SPE 1987 Standards adopted by the

Company were subsequently replaced by PRMS 2018 during 2018 to 2019. However, the Company has

developed its internal reserves estimation definitions to take into account PRMS 2018. As a result of differences

between the Company’s internally developed methodology and PRMS 2018, the management’s internal

estimates of its reserves may vary from reserves estimates prepared using PRMS 2018. Based on the last

independent audit of the Company’s domestic reserves, the Company believes that its reserve information is

comparable within permissible limits as per industry practice to management’s internal estimates. For further

information relating to the implications of the differences between these definitions, see “Investment

Considerations —Risks relating to the Company’s Business — The Company’s crude oil and natural gas

reserves estimates involve a degree of uncertainty and may not prove to be correct over time. Moreover, these

estimates may be unaudited or may not be fully audited and may not accurately reflect actual reserves, or even

if accurate, technical limitations may prevent the Company from producing crude oil or natural gas from these

reserves”.

The Company’s international reserves are calculated on the basis of various standards that are applicable

in the relevant jurisdiction in which the relevant reserves are located.

All reserve estimates and information derived therefrom contained in this Offering Circular are

unaudited management’s internal estimates.

The Company’s reporting policy is not, and is not required to be, derived from, or consistent with oil

and gas reserves reporting requirements for filings with the SEC and differs from such requirements in certain

material respects. The Company’s reserves would differ from those described herein if determined in

accordance with oil and gas reserves reporting requirements for filings with the SEC. There are currently no

clear regulations governing public disclosure of potential reserves by oil and gas companies operating in India

or their use in securities offering documents. As of the date of this Offering Circular, there are no clear

regulations governing public disclosure of potential reserves by oil and gas companies operating in India or

their usage in offering documents.

A39729228 170

Evaluations of crude oil and natural gas reserves involve various uncertainties and require exploration

and production companies to make extensive judgements as to future events based upon the information

available. The crude oil and natural gas reserves data are estimates based primarily on internal technical analyses

using standard industry practices. Such estimates reflect the Company’s best judgement at the time of their

preparation, based on geological and geophysical analyses and appraisal work (which are dynamic processes),

and may differ from previous estimates. Reserves estimates are subject to various uncertainties, including those

relating to the reservoir parameters of crude oil and natural gas fields. These reservoir parameters may be

difficult to estimate and, as a result, actual production may be materially different from current estimates of

reserves. Factors affecting the Company’s reserves estimates include: the outcome of new production or drilling

activities; assumptions regarding the future performance of wells and surface facilities; the results of field

reviews; the Company’s ability to acquire new reserves from discoveries or extensions of existing fields; the

Company’s ability to apply improved recovery techniques; and changed economic conditions.

The following table sets forth information relating to the Company’s crude oil and natural gas reserves

as of 31 March 2019:

As of 31 March 2019(1)

1P 2P 3P

Crude Oil + Condensate

Domestic (Onshore) (MMT) ...................................................... 140.61 145.41 147.74

Domestic (Onshore) (MMbbls) .................................................. 1,054.58 1,090.58 1,108.05

Domestic (Offshore) (MMT) ..................................................... 183.00 214.84 257.46

Domestic (Offshore) (MMbbls) ................................................. 1,372.50 1,611.30 1,930.95

International (Onshore and Offshore) (MMT) ........................... 187.20 340.36 355.49

International (Onshore and Offshore) (MMbbls) ....................... 1,378.95 2,471.08 2,581.55

Total (MMT) ............................................................................ 510.81 700.61 760.69

Total (MMbbls) ........................................................................ 3,806.03 5,172.96 5,620.55

Natural Gas

Domestic (Onshore) (BCM) ....................................................... 123.08 133.89 134.45

Domestic (Offshore) (BCM) ...................................................... 198.91 276.11 300.81

International (Onshore and Offshore) (BCM) ............................ 158.58 335.36 351.19

Total (BCM) ............................................................................. 480.57 745.36 786.45

Grand Total (MMtoe) .............................................................. 991.38 1,445.97 1,547.14

Note:

(1) The Company used crude oil conversion ratios for its international fields based on the respective specific gravities of crude

oil/Condensate produced from those fields areas as follows: Domestic fields: one metric to 7.5 barrels. International fields: Greater

Nile Petroleum Operating Company (“GNPOC”) (Sudan); one metric ton to 7.14 barrels; Greater Pioneering Operating Company

(“GPOC”) (South Sudan): one metric ton to 7.3 barrels; Block 5A (South Sudan): one metric ton to 7.3 barrels; Vietnam Condensate:

one metric ton to 8.38 barrels; Sakhalin (Russia): one metric ton to 7.42 barrels; ACG (Azerbaijan): one metric ton to 7.42 barrels;

Imperial (Russia): one metric ton to 7.6 barrels; Al Furat (Syria): one metric ton to 7.3 barrels; Block-24 (Syria): one metric ton to

7.41 barrels; Mansarovar Energy Colombia Ltd. (“MECL”) (Colombia): one metric ton to 6.44 barrels; Carabobo-1 (Venezuela): one

metric ton to 6.24 barrels; PIVSA (Venezuela): one metric ton to 6.57 barrels; BC-10 (Brazil): one metric ton to 6.65 barrels; CPO-5

(Colombia): one metric ton to 7.59 barrels; LZC (UAE): one metric ton to 7.62 barrels and Vankor (Russia): one metric ton to 7.44

barrels.

A39729228 171

Reserves Classification Standards

PRMS 2018

PRMS 2018 is a fully integrated system that provides the basis for classification and categorisation of

all petroleum reserves and resources. PRMS 2018 is now universally accepted as a standard system for

petroleum resource classification, evaluation, reporting and portfolio management requirements. It provides a

common language for communicating both the confidence of a project’s resources maturation status and the

range of potential outcomes to the various entities such as national reporting, evaluator, regulatory disclosure

agencies etc. In 2007, SPE along with contributions from other professional bodies developed the Petroleum

Resources Management System to provide a common reference for the international petroleum industry. Later

on, the revised PRMS 2018 was published in 2018 with participation of professional bodies such as Society of

Petroleum Engineers, World Petroleum Council, American Association of Petroleum Geologists, Society of

Petroleum Evaluation Engineers, Society of Exploration Geophysicists, Society of Petrophysicists and Well

Log Analysts and European Association of Geoscientists and Engineers. The Company migrated its discovered

Petroleum resources to PRMS 2018 with effect from 31 March 2019 based on PRMS 2018.

Petroleum Resources classification, categorisation of Reserves and definitions

PRMS 2018 classifies resources into discovered and undiscovered and defines the recoverable resources

classes in: ‘Production’, ‘Reserves’, ‘Contingent Resources’, and ‘Prospective Resources’.

Total Petroleum Initially-In-Place (“PIIP”): PIIP is all quantities of petroleum that are estimated to exist

originally in naturally occurring accumulations, discovered and undiscovered, before production.

Discovered PIIP is the quantity of petroleum that is estimated, as of a given date, to be contained in

known accumulations before production. Undiscovered PIIP is that quantity of petroleum estimated, as

of a given date, to be contained within accumulations yet to be discovered.

Discovered PIIP henceforth will be referred as “OIIP” for oil and “GIIP” in case of gas. Earlier

classification of Initially-In-place to Prove and Unproved category remain unchanged. The Unproved

will further be sub classified as Probable and Possible.

Estimated Ultimate Recovery (“EUR”): EUR is not a resources category or class, but a term that can be

applied to define those quantities of petroleum estimated, as of a given date, to be potentially recoverable

from discovered accumulation or group of accumulations plus those quantities already produced.

During the migration process of the Company’s legacy data, a significant volume of Reserves reported

earlier were split in to Reserve and Contingent Resources. Part of EUR not participating in commercial

production is categorised as Contingent Resources. In the Company’s parlance, EUR is essentially

Technically Recoverable Resources. However, EUR (Commercial) will denote cumulative

production and Reserves only.

Recoverable Resource Classes and Sub-Classes

Production is the cumulative quantities of petroleum that have been recovered at a given date.

Multiple development projects may be applied to each known or discovered accumulation, and each

project will be forecast to recover an estimated portion of the initially-in-place quantities. The projects shall be

subdivided into commercial and sub-commercial, with the estimated recoverable quantities being classified as

Reserves and Contingent Resources respectively.

Reserves: Reserves are those quantities of petroleum anticipated to be commercially recoverable by

application of development projects to known accumulations from a given date forward under defined

conditions. Reserves must satisfy four criteria: discovered, recoverable, commercial, and remaining

based on the development project(s) applied. Reserves are further categorised in accordance with the

A39729228 172

level of certainty associated with the estimates and may be sub-classified based on project maturity

and/or characterised by the development and production status, such as “on production”, “approved for

development and under implementation” and “justified and approved for development”.

Contingent Resources: Contingent Resources are those quantities of petroleum estimated, as of a given

date, to be potentially recoverable from known accumulations by application of development projects,

but which are not currently considered to be commercially recoverable owing to one or more

contingencies and can be sub-classified as “development pending”, “development on hold”,

“development unclarified” and “development not viable”.

Prospective Resources: Prospective Resources are those quantities of petroleum that are estimated, as of

a given date, to be potentially recoverable from undiscovered accumulations. REC Book is dealing with

Discovered Resources only.

Reserves Category Definitions and Guidelines

Proved Reserves: Proved Reserves are those quantities of petroleum that, by analysis of geoscience and

engineering data, can be estimated with reasonable certainty to be commercially recoverable from a

given date forward from known reservoirs and under defined economic conditions, operating methods

and government regulations. If deterministic methods are used, the term “reasonable certainty” is

intended to express a high degree of confidence that the quantities classified as Proved Reserve (1P) will

be recovered. If probabilistic methods are used, there should be at least a 90.00 per cent. probability

(P90) that the quantities actually recovered will equal or exceed the estimate.

The area of the reservoir considered as “Proved” includes (a) the area delineated by drilling and defined

by fluid contacts, if any, (b) adjacent undrilled portions of the reservoir that can reasonably be judged as

continuous with it and commercially productive on the basis of available geoscience and engineering

data (c) in the absence of data on fluid contacts, Proved quantities in a reservoir are limited by the lowest

known hydrocarbon as seen in a well penetration unless otherwise indicated by definitive geoscience,

engineering, or performance data. Such definitive information may include pressure gradient analysis

and seismic indicators. Seismic Data alone may not be sufficient to define fluid contacts for Proved.

For Proved Reserves, the recovery efficiency applied to these reservoirs should be defined based on a

range of possibilities supported by analogs and sound engineering judgement considering the

characteristics of the Proved area and the applied development programme.

Probable Reserves: Probable Reserves are those additional Reserves that analysis of geoscience and

engineering data indicates are less likely to be recovered than Proved Reserves but more certain to be

recovered than Possible Reserves. It is equally likely that actual remaining quantities recovered will be

greater than or less than the sum of the estimated Proved plus Probable Reserves (2P). In this context,

when probabilistic methods are used, there should be at least a 50.00 per cent. probability that the actual

quantities recovered will equal or exceed the 2P estimate. Probable Reserves may be assigned to areas

of a reservoir adjacent to Proved areas where data control or interpretations of available data are less

certain. The interpreted reservoir continuity may not meet the reasonable certainty criteria. Probable

estimates also include incremental recoveries associated with project recovery efficiencies beyond that

assumed for Proved.

Possible Reserves: Possible Reserves are those additional Reserves that analysis of geoscience and

engineering data indicates are less likely to be recoverable than Probable Reserves. The total quantities

ultimately recovered from the project have a low probability to exceed the sum of Proved plus Probable

plus Possible (3P), which is equivalent to the high-estimate scenario. When probabilistic methods are

used, there should be at least a 10.00 per cent. probability (P10) that the actual quantities recovered will

A39729228 173

equal or exceed the 3P estimate. Possible Reserves may be assigned to areas of a reservoir adjacent to

Probable where data control and interpretations of available data are progressively less certain.

Frequently, this may be in areas where geoscience and engineering data are unable to clearly define the

area and vertical reservoir limits of economic production from the reservoir by a defined, commercially

mature project. Possible estimates also include incremental quantities associated with project recovery

efficiencies beyond that assumed for Probable.

Reserves Status Definitions and Guidelines

Developed Reserves: Developed Reserves are expected quantities to be recovered from existing wells

and facilities. Developed Reserves may be further sub-classified as Producing or Non-producing.

Undeveloped Reserves: Undeveloped Reserves are quantities expected to be recovered through future

significant investments.

Developed and Undeveloped Reserves

The following table sets forth certain information relating to the Company’s proved and proved

developed domestic and international crude oil and natural gas reserves on a geographical basis for the 2018

Fiscal Year and the 2019 Fiscal Year:

Proved Reserves

- Crude Oil (MMT)

Gas (Billion Cubic

Metre)

Total Oil Equivalent

(MTOE)

Details

As of 31

March

2018

As of 31

March

2019

As of 31

March

2018

As of 31

March

2019

As of 31

March

2018

As of 31

March

2019

A. In India(1)

Offshore ........................... Opening 198.98 187.73 186.08 182.37 385.06 370.10

Addition 4.94 10.29 14.90 36.28 19.84 46.56

Production 16.19 15.01 18.61 19.74 34.80 34.75

Closing 187.73 183.00 182.37 198.91 370.10 381.91

Onshore ........................... Opening 183.30 179.21 142.58 145.56 325.88 324.77

Addition 4.32 (30.17) 8.87 (16.61) 13.19 (46.79)

Production 8.41 8.43 5.89 5.87 14.30 14.30

Closing 179.21 140.61 145.56 123.08 324.77 263.69

Total in India ................... Opening 382.28 366.94 328.66 327.93 710.93 694.88

Addition 9.26 (19.89) 23.77 19.66 33.03 (0.23)

Production 24.60 23.44 24.50 25.61 49.08 49.05

Closing 366.94 323.61 327.93 321.98 694.88 645.60

B. Outside India

i. Russia, CIS and the

Far East

Sakhalin-1, Russia ........... Opening 36.00 34.14 71.97 71.35 107.97 105.49

Addition - (0.57) - (18.27) - (18.84)

Ded/Adj 0.01 0.00 0.02 - 0.03 0.00

Production 1.86 2.50 0.59 0.62 2.45 3.11

Closing 34.14 31.08 71.35 52.46 105.49 83.54

IEC, Russia ...................... Opening 14.69 14.43 3.93 3.9 18.61 18.32

A39729228 174

- Crude Oil (MMT)

Gas (Billion Cubic

Metre)


(MTOE)

Details

As of 31

March

2018

As of 31

March

2019

As of 31

March

2018

As of 31

March

2019

As of 31

March

2018

As of 31

March

2019

Addition - - - - - -

Ded/Adj - 0.00 - 0.00 - -

Production 0.26 0.21 0.04 0.04 0.29 0.24

Closing 14.43 14.22 3.89 3.85 18.32 18.08

Block-A1 and A3, ............ 0.00

Myanmar ......................... Opening - - 9.30 8.48 9.30 8.47

Addition - - - 1.88 - 1.88

Ded/Adj - - - - - -

Production - - 0.83 0.70 0.83 0.70

Closing - - 8.47 9.65 8.47 9.65

ACG, Azerbaijan ............. Opening 5.66 3.78 - - 5.66 3.78

Addition - 6.30 - - - 6.30

Ded/Adj 1.11 - - - 1.11 -

Production 0.76 0.66 - - 0.76 0.66

Closing 3.78 9.43 - - 3.78 9.43

Block 06.1, Vietnam ........ Opening 0.59 0.63 5.82 6.99 6.42 7.61

Addition 0.06 0.02 2.57 0.50 2.62 0.52

Ded/Adj - - 0.00 - 0.00 -

Production 0.02 0.02 1.40 1.55 1.42 1.57

Closing 0.63 0.63 6.99 5.94 7.61 6.57

Vankor, Russia................. Opening 74.80 74.61 7.33 15.86 82.12 90.47

Addition 4.26 7.55 10.28 2.09 14.54 9.63

Ded/Adj - 0.00 - 0.00 - 0.00

Production 4.44 4.14 1.75 1.66 6.19 5.80

Closing 74.61 78.02 15.86 16.29 90.47 94.30

ii. Latin America

PIVSA, Venezuela ........ Opening 8.54 8.19 - - 8.54 8.19

Addition - 0.00 - - - 0.00

Ded/Adj - 0.00 - - - 0.00

Production 0.35 0.26 - - 0.35 0.26

Closing 8.19 7.94 - - 8.15 7.94

Carabobo-1, Venezuela . Opening 4.36 4.20 - - 4.36 4.20


Ded/Adj - - - - - -

Production 0.15 0.11 - - 0.15 0.11

Closing 4.20 4.09 - - 4.20 4.09

BC-10, Brazil ................ Opening 3.02 1.57 0.20 0.19 3.22 1.76

Addition - 0.20 0.03 0.01 0.03 0.21

A39729228 175

- Crude Oil (MMT)

Gas (Billion Cubic

Metre)


(MTOE)

Details

As of 31

March

2018

As of 31

March

2019

As of 31

March

2018

As of 31

March

2019

As of 31

March

2018

As of 31

March

2019

Ded/Adj 0.78 0.00 - - 0.78 0.00

Production 0.66 0.52 0.04 0.03 0.70 0.55

Closing 1.57 1.26 0.19 0.17 1.76 1.42

MECL, Colombia .......... Opening 1.99 2.02 0.00 - 1.99 2.02

Addition 0.50 0.01 0.00 - 0.50 0.01

Ded/Adj - - 0.00 - - -

Production 0.48 0.43 0.00 - 0.48 0.43

Closing 2.02 1.60 0.00 - 2.02 1.60

CPO-5, Colombia .......... Opening - - - - - -

Addition - 0.35 - - - 0.35

Ded/Adj - 0.00 - - - 0.00

Production - 0.10 - - - 0.10

Closing - 0.25 - - - 0.25

iii. Africa

GNOP, Sudan................ Opening 6.40 6.92 - - 6.40 6.92

Addition 0.81 - - - 0.81 -

Ded/Adj - 0.00 - - - 0.00

Production 0.28 0.26 - - 0.28 0.26

Closing 6.92 6.67 - - 6.92 6.67

GPOC, Sudan ................ Opening 6.38 6.38 - - 6.38 6.38

Addition - 0.60 - - - 0.60

Ded/Adj - - - - - -

Production - 0.13 - - - 0.13

Closing 6.38 6.84 - - 6.38 6.84

Block5A, Sudan ............ Opening 5.89 5.89 - - 5.89 5.89


Ded/Adj - - - - - -

Production - - - - - -

Closing 5.89 5.89 - - 5.89 5.89

Area-1 Mozambique ..... Opening - - - - - -

Addition - - - 70.23 - 70.23

Ded/Adj - - - - - -


Closing - - - 70.23 - 70.23

iv. Middle East

AFPC, Syria ..................... Opening 2.58 2.58 - - 2.58 2.58


A39729228 176

- Crude Oil (MMT)

Gas (Billion Cubic

Metre)


(MTOE)

Details

As of 31

March

2018

As of 31

March

2019

As of 31

March

2018

As of 31

March

2019

As of 31

March

2018

As of 31

March

2019

Ded/Adj - - - - - -


Closing 2.58 2.58 - - 2.58 2.58

Block-24, Syria ................ Opening 1.80 1.80 - - 1.80 1.80


Ded/Adj - - - - - -


Closing 1.80 1.80 - - 1.80 1.80

Lower Zakum, Abu

Dhabi ............................... Opening - 13.23 - - - 13.23

Addition 13.28 2.43 - - 13.28 2.43

Ded/Adj - - - - - -

Production 0.05 0.76 - - 0.05 0.76

Closing 13.23 14.91 - - 13.23 14.90

Total outside India ........... Opening 172.69 180.38 98.54 106.75 271.23 287.13

Addition 18.91 16.89 12.88 56.44 31.788 73.32

Ded/Adj 1.90 (0.02) 0.02 0.01 1.92 (0.01)

Production 9.32 10.09 4.65 4.60 13.96 14.69

Closing 180.38 187.20 106.75 158.58 287.13 345.78

Note:

(1) From 1 April 2018, the Company’s domestic reserves in India were estimated and calculated pursuant to PRMS 2018. As a result, the

addition of reserves amount in India as of 31 March 2019 may vary and may not be directly comparable with previous corresponding

periods due to such migration.

Proved Developed Reserves

As of 31 March 2019, according to management’s internal estimates, the Company’s domestic proved

developed crude oil and natural gas reserves, estimated in accordance with PRMS 2018, were 453.28 MMtoe.

As of 31 March 2019, according to management’s internal estimates, the Company’s international proved

developed crude oil and natural gas reserves excluding Sudan and South Sudan were 173.35 MMtoe. As of 31

March 2019, according to management’s internal estimates, the Company’s proved developed crude oil and

natural gas reserves in Sudan and South Sudan, estimated in accordance with SPE definitions, were 7.79

MMtoe.

The following table sets forth certain information relating to the Company’s proved developed domestic

and international crude oil and natural gas reserves on a geographical basis as of 31 March 2019 for the 2019

Fiscal Year:

A39729228 177

Crude Oil (MMT)

Gas (Billion Cubic

Metre)


(MTOE)

Details

As of

31March

2018

As of

31March

2019

As of

31March

2018

As of

31March

2019

As of

31March

2018

As of

31March

2019

A. In India(1)

Offshore ........................... Opening 134.08 127.23 112.50 112.30 246.62 239.54

Addition 9.35 18.07 18.37 52.43 27.72 70.51

Production 16.20 15.01 18.61 19.74 34.80 34.75

Closing 127.23 130.30 112.30 145.00 239.54 275.29

Onshore ........................... Opening 137.85 133.03 94.44 89.56 232.29 222.59

Addition 3.58 (21.11) 1.11 (9.18) 4.69 (30.30)

Production 8.40 8.43 5.99 5.87 14.39 14.30

Closing 133.03 103.49 89.56 74.50 222.59 177.99

Total in India ................... Opening 271.93 260.26 206.98 201.86 478.91 462.12

Addition 12.93 (3.04) 19.48 43.25 32.41 40.21

Production 24.60 23.44 24.60 25.61 49.20 49.05

Closing 260.26 233.78 201.86 219.50 462.12 453.28

B. Outside India

i. Russia, CIS and the

Far East

Sakhalin-1, Russia ........... Opening 16.77 16.74 9.84 9.51 26.60 26.24

Addition 1.83 0.94 0.26 19.59 2.09 20.54

Ded/Adj - 0.00 - 0.00 - 0.00

Production 1.86 2.49 0.59 0.62 2.450 3.11

Closing 16.74 15.19 9.51 28.48 26.24 43.67

IEC, Russia ...................... Opening 4.93 4.68 1.08 1.05 6.02 5.72

Addition - 0.00 - - - 0.00

Ded/Adj - 0.00 - - 0.00

Production 0.26 0.21 0.04 0.04 0.29 0.24

Closing 4.68 4.47 1.05 1.01 5.72 5.48

Block-A1 and A3, ............ 0.00

Myanmar ......................... Opening - - 5.87 5.04 5.87 5.04

Addition - - - (0.32) - (0.32)

Ded/Adj - - - 0.00 - 0.00

Production - - 0.83 0.70 0.83 0.70

Closing - - 5.04 4.03 5.04 4.03

ACG, Azerbaijan ............. Opening 4.49 3.33 - - 4.49 3.33

Addition - 6.40 - - - 6.40

Ded/Adj 0.40 - - 0.40 -

Production 0.76 0.66 - - 0.76 0.66

Closing 3.33 9.08 - - 3.33 9.08

Block 06.1, Vietnam ........ Opening 0.59 0.61 3.90 3.50 4.49 4.11

Addition 0.05 0.04 1.00 3.99 1.05 4.03

A39729228 178

Crude Oil (MMT)

Gas (Billion Cubic

Metre)


(MTOE)

Details

As of

31March

2018

As of

31March

2019

As of

31March

2018

As of

31March

2019

As of

31March

2018

As of

31March

2019

Ded/Adj - 0.00 0.00 0.00 0.00

Production 0.02 0.02 1.40 1.55 1.42 1.57

Closing 0.61 0.63 3.50 5.94 4.11 6.57

Vankor, Russia................. Opening 55.90 41.10 5.39 8.65 61.29 49.75

Addition - 33.64 5.01 7.73 5.01 41.37

Ded/Adj 10.35 - - 0.00 10.35 (0.000)

Production 4.44 4.14 1.75 1.66 6.19 5.80

Closing 41.10 70.60 8.65 14.72 49.75 85.32

ii. Latin America

PIVSA, Venezuela ........... Opening 1.27 0.92 - - 1.27 0.92

Addition - 0.00 - - - 0.00

Ded/Adj - 0.00 - - - 0.00

Production 0.35 0.26 - - 0.35 0.26

Closing 0.92 0.67 - - 0.92 0.67

Carabobo-1, Venezuela .... Opening 1.81 2.04 - - 1.81 2.04

Addition 0.38 - - - 0.38 -

Ded/Adj - - - - - -

Production 0.15 0.11 - - 0.15 0.11

Closing 2.04 1.92 - - 2.04 1.92

BC-10, Brazil ................... Opening 3.02 1.46 0.20 0.09 3.22 1.55

Addition - 0.32 - 0.11 - 0.42

Ded/Adj 0.90 0.00 0.07 0.97 0.00

Production 0.66 0.52 0.04 0.03 0.70 0.55

Closing 1.46 1.26 0.09 0.17 1.55 1.42

MECL, Colombia ............ Opening 1.75 1.57 0.00 - 1.75 1.57

Addition 0.30 0.09 0.00 - 0.30 0.09

Ded/Adj - 0.00 0.00 - - 0.00

Production 0.48 0.43 0.00 - 0.48 0.43

Closing 1.57 1.23 0.00 - 1.57 1.23

CPO-5, Colombia .......... Opening - - - - - -

Addition - 0.35 - - - 0.35

Ded/Adj - 0.00 - - - 0.00

Production - 0.10 - - - 0.10

Closing - 0.25 - - - 0.25

iii. Africa

GNOP, Sudan .................. Opening 2.25 1.60 - - 2.25 1.60


Ded/Adj 0.38 0.00 - - 0.38 - 0.00

Production 0.28 0.26 - - 0.282 0.257

A39729228 179

Crude Oil (MMT)

Gas (Billion Cubic

Metre)


(MTOE)

Details

As of

31March

2018

As of

31March

2019

As of

31March

2018

As of

31March

2019

As of

31March

2018

As of

31March

2019

Closing 1.60 1.34 - - 1.597 1.341

GPOC, South Sudan ........ Opening 4.31 4.31 - - 4.312 4.312

Addition - (0.30) - - - (0.297)

Ded/Adj - - - - - -

Production - 0.13 - - - 0.131

Closing 4.31 3.88 - - 4.312 3.884

Block5A, South Sudan ..... Opening 2.56 2.56 - - 2.565 2.565


Ded/Adj - - - - - -


Closing 2.56 2.56 - - 2.565 2.565

iv. Middle East

AFPC, Syria ..................... Opening 2.21 2.21 - - 2.21 2.21


Ded/Adj - - - - - -


Closing 2.21 2.21 - - 2.21 2.21

Block-24, Syria ................ Opening 0.05 0.05 - - 0.05 0.05


Ded/Adj - - - - - -


Closing 0.05 0.05 - - 0.05 0.05

Lower Zakum, UAE ........ Opening - 10.91 - - - 10.91

Addition 10.96 1.30 - - 10.96 1.30

Ded/Adj - - - - -

Production 0.05 0.76 - - 0.05 0.76

Closing 10.905 11.445 - - 10.91 11.44

Total outside India ........... Opening 101.91 94.08 26.29 27.84 128.20 121.92

Addition 13.51 42.78 6.27 31.11 19.78 73.88

Ded/Adj 12.02 (0.03) 0.07 (0.01) 12.09 (0.04)

Production 9.32 10.09 4.65 4.60 13.96 14.69

Closing 94.08 126.79 27.84 54.35 121.92 181.13

Note:

(1) From 1 April 2018, the Company’s domestic reserves in India are estimated and calculated pursuant to PRMS 2018. As a result, the

addition of reserves amount in India as of 31 March 2019 may vary and may not be directly comparable with previous corresponding

periods due to such migration.

A39729228 180

Proved Undeveloped Reserves

As of 31 March 2019, according to management’s internal estimates, the Company’s international

proved undeveloped crude oil and natural gas reserves excluding Sudan and South Sudan, estimated in

accordance with SPE for majority of assets and Russian classifications for the Sakhalin-1 asset, were 153.03

MMtoe. According to management’s internal estimates, as of 31 March 2019, the Company’s proved

undeveloped crude oil and natural gas reserves in Sudan and South Sudan, estimated in accordance with SPE

definitions were 11.61 MMtoe.

Crude Oil and Natural Gas Production

As of 31 March 2019, the Company had 6,377 gross (4,846 net) flowing/productive oil wells and 940

gross (562 net) flowing/productive gas wells. As of 31 March 2019, the Company operated in India with 31

nomination PELs covering an area of 61,714 sq. km, nine nomination PELs covering an area of 36,833 sq. km,

one Pre-NELP covering 892 sq. km, 19 NELP exploration acreages covering an area of 22,533 sq. km

(excluding six blocks wholly converted into PMLs), two OALP acreages covering 1,456 sq. km, and 345 PMLs

covering an area of 55,805 sq. km in nomination regime and nine PMLs covering an area of 1,266 sq. km of

NELP regime.

The following table sets forth certain information relating to the Company’s domestic and international

crude oil and natural gas production for the 2017 Fiscal Year, the 2018 Fiscal Year and the 2019 Fiscal Year:

2017 Fiscal Year 2018 Fiscal Year 2019 Fiscal Year

Oil

(MMbbls) Gas (BCM)

Oil

(MMbbls) Gas (BCM)

Oil

(MMbbls) Gas (BCM)

A. In India

Location

Basin/

Project

i. Wholly owned and

operated fields

Offshore ...........................

Western

Mumbai

Offshore 121.96 16.79 121.76 17.64 112.14 18.42

Eastern

Offshore 0.12 0.48 0.06 0.61 0.15 1.14

Onshore ...........................

Western

Onshore

Except

Jaisalmer 33.56 1.52 33.46 1.57 33.77 1.36

Jaisalmer — 0.01 — 0.01 — 0.01

Assam and

Assam

Arakan 7.14 1.90 7.31 2.00 7.45 2.09

Krishna-

Godavari 2.07 0.89 2.41 0.98 2.18 1.11

Cauvery 2.00 1.00 2.34 1.22 2.70 1.21

ii. Joint ventures — — — — — —

Offshore ...........................

Mumbai

Offshore 2.37 0.77 2.07 0.76 1.59 0.62

Krishna-

Godavari 2.42 0.08 2.15 0.09 1.80 0.09

Cambay 1.43 0.04 1.49 0.05 2.76 0.06

A39729228 181

2017 Fiscal Year 2018 Fiscal Year 2019 Fiscal Year

Oil

(MMbbls) Gas (BCM)

Oil

(MMbbls) Gas (BCM)

Oil

(MMbbls) Gas (BCM)

Onshore ...........................

Barmer,

Rajasthan 18.37 0.32 17.73 0.25 17.24 0.31

Cambay 0.03 0.00 0.03 0.00 0.05 0.00

Total in India .................. 24.63 1.21 23.47 1.15 23.44 1.09

B. Outside India

Country Project

i. Caspian Sea Region

and the Far East

Russia .............................. Sakhalin-1 13.45 0.56 13.83 0.59 18.47 0.62

IEC 2.06 0.03 1.95 0.04 1.57 0.04

Vankor 24.68 1.23 33.06 1.75 30.80 1.66

Myanmar .........................

Block-A1

and A3 - 0.84 - 0.83 - 0.70

Azerbaijan........................ ACG 6.08 0.13 5.66 0.09 4.87 0.08

Vietnam .......................... Block 06.1 0.21 1.48 0.19 1.40 0.14 1.55

ii. Latin America

Venezuela ........................

San

Cristobal 2.81 0.05 2.29 0.04 1.69 0.03

Carabobo-1 0.88 0.01 0.97 0.02 0.71 0.01

Brazil ............................... BC-10 4.02 0.05 4.40 0.04 3.42 0.03

Colombia ........................ MECL 3.49 0.01 3.06 0.01 2.78 0.01

CPO-5 - - 0.29 0.00 0.96 0.00

iii. Africa

Sudan ............................... GNPOC 3.43 - 2.02 - 1.83 -

South Sudan ..................... GPOC - - - - 0.96 -

South Sudan Block5A - - - - - -

iv. Middle East

Syria ................................

Al Furat

Petroleum

Company - - - - - -

Block-24 - - - - - -

UAE ................................. - - 0.39 - 5.77 -

Total outside India ......... 61.11 4.37 68.11 4.81 73.98 4.74

Total production inside and outside India

For the 2019 Fiscal Year, the Company sold approximately 92.86 per cent. of its total crude oil

production and 79.37 per cent. of its total natural gas production, whilst the remaining were consumed by the

Company to run its operations and, to a lesser extent, were flared and injected gas.

A39729228 182

The Company’s Principal Producing Areas

Domestic Producing Areas

The Company’s domestic onshore producing areas are located in the states of Gujarat, Rajasthan, Assam,

Tripura, Tamilnadu, Andhra Pradesh and in the Cambay, Jaisalmer, Assam and Assam Arakan, Krishna-

Godavari and Cauvery basins. The Company’s domestic offshore producing fields include the Mumbai offshore

basin off the west coast of India, and the Cauvery and Krishna-Godavari basins off the east coast of India.

Owned and Operated Offshore Producing Fields

Mumbai Offshore Basin

The Mumbai offshore basin, the largest offshore basin in India, is located off the west coast of India and

covers an area of approximately 116,000 sq. km. The Company made its first crude oil discovery in this basin

in 1974. As of 31 March 2019, the Company held 25 PMLs covering an area of 28,677 sq. km in this basin.

The major producing fields within this basin are Mumbai High, Cluster-7, B-Series, C-Series, North

Tapti, Daman Tapti block, NB Prasad (D-1), Bassein, Vasai-East, Heera and South Heera and Neelam. The

hydrocarbon discoveries in each of the fields was made by the Company under a nomination petroleum

exploration licence.

The Mumbai High field is a major offshore crude oil and natural gas producing area in the Mumbai

offshore basin and represented approximately 33.00 per cent. of the Company’s total domestic crude oil

production (inclusive of its share of joint venture production) and approximately 19.30 per cent. of the

Company’s total natural gas production from its owned and operated fields (inclusive of its share of joint

venture production) for the 2019 Fiscal Year.

The Mumbai High field is located around 160 km west of Mumbai in the Arabian sea. This field acts as

a hub for a growing number of small satellite fields and therefore the Mumbai High infrastructure represents a

key resource for future offshore developments. The first discovery well was drilled in 1974. The hydrocarbon

discovery in this field was made by the Company under a nomination petroleum exploration licence. The

Company carried out its development programmes and commenced oil production from Mumbai High North

in 1976 and Mumbai High South in 1980. In 2001, the Company commenced a field redevelopment programme

to improve oil production rates and to increase the field’s ultimate oil recovery. A peak crude oil production

rate of 420,000 barrels of oil per day was achieved in 1988. Three phases of redevelopment targeting MH North

and South fields have been implemented as part of rolling development concept targeting the multiple sub-

layers, bypassed oil through infill drilling, well platforms, augmenting process facilities, water injection support

for pressure maintenance and induction of various new technologies. Currently, phase-IV redevelopment

scheme is under implementation and is scheduled for completion by May 2021 for Mumbai High North and by

March 2022 for Mumbai High South.

The Company’s 1P, 2P and 3P crude oil and natural gas reserves in the Mumbai offshore basin, as of 31

March 2019, were 342.66 MMtoe, 380.67 MMtoe and 445.76 MMtoe, respectively, according to management’s

internal estimates.

Owned and Operated Onshore Producing Fields

Cambay Basin

The Cambay basin is one of the Company’s most significant onshore crude oil and natural gas producing

areas. The basin is located primarily in the state of Gujarat and covers approximately 53,500 sq. km. The basin

is a rift basin which extends from Surat in the south to Sanchor in the north. In the north, the basin narrows, but

continues beyond Sanchor to pass into the Barmer basin of Rajasthan. On the southern side, the basin merges

A39729228 183

with the Mumbai offshore basin in the Arabian Sea. As of 31 March 2019, the Company held 169 PMLs

covering an area of 5,713 sq. km under nomination and five NELP PMLs covering an area of 167 sq. km in this

basin. In addition, the Company held one PML acreage converted from NELP block in Gulf of Cambay. In

addition, as of the date of this Offering Circular, applications for 15 PMLs covering an area of 335 sq. km are

under consideration by the Indian Government.

The major producing fields within this basin are Sobhasan, Santhal, North Kadi, Kalol, Jhalora,

Ankleshwar and Gandhar, all of which are oil- and gas-producing fields (with the exception of the Santhal field,

which does not produce gas) whose hydrocarbon discoveries were made by the Company under nomination

petroleum exploration licences. In addition, the Company has made field discoveries in Karannagar, Nadiad,

Vadtal and West Patan under its NELP licences. The Sobhasan, Santhal and North Kadi fields are located within

the Mehsana asset, the Kalol and Jhalora fields are located within the Admedabad asset and the Ankleshwar

and Gandhar fields are located within the Ankleshwar asset.

Jaisalmer Basin (Rajasthan)

The Jaisalmer basin, situated in western Rajasthan, covers an area of approximately 45,000 sq. km. The

basin is limited by the India-Pakistan border in the north and west and the Aravalli-Delhi ranges in the east. The

basin is divided into three sub-basins, namely, the Kishangarh sub-basin in the east, the Shahgarh sub-basin in

the west and the Miajlar sub-basin in the south. As of 31 March 2019, the Company held four PMLs covering

an area of 882 sq. km in this basin.

The major natural gas producing field of the Jaisalmer basin is the Manhera Tibba field which was

discovered in 1967. The hydrocarbon discovery in this field was made by the Company under a nomination

petroleum exploration licence. The Company produces natural gas in the Jaisalmer basin. The Company also

holds a participating interest in the development area of the pre-NELP block in Barmer basin operated by Cairn

Energy India Pty Ltd, which is under commercial production.

Assam and Assam-Arakan Basin

The Assam and Assam-Arakan basin is located on the north-eastern plunge of the Shillong-Mikir uplift

and bounded by the Arunachal Himalayas in the north, the Naga Schuppen Belt in the southeast and by the

Assam-Arakan fold belt in the south. The plains of Bangladesh lie to its west and south. The areas in the Assam

and Assam Arakan basin in which the Company has an interest lie in the states of Assam, Tripura, Mizoram,

Manipur and Nagaland. The basin covers an area of approximately 116,000 sq. km. As of 31 March 2019, the

Company held 64 PMLs covering an area of 5,926 sq. km in the basin. In addition, as of the date of this Offering

Circular, applications for four PMLs covering an area of 1,421 sq. km are under consideration by the Indian

Government.

The major producing fields within this basin are Lakwa-Lakhmani, Geleki, Rudrasagar,

Changamaigaon, Charali, Laiplingaon, Panidihing, Safrai, Banmali, Demulgaon, Disangmukh, Khoraghta,

Nambar, Borholla, East lakhibari, Mekrang, Kasomarogaon and fields of Tripura. The Lakwa-Lakhmani fields

are located within the Assam asset and form the eastern and western part of the Lakwa structure in the Assam

and Assam-Arakan, the Geleki field is located the Assam asset in the southern fringe of the upper Assam valley

in the Assam and Assam-Arakan basin and the Rudrasagar field is located within the Assam asset in the Assam

and Assam-Arakan basin. The hydrocarbon discoveries in each of these fields was made by the Company under

a nomination petroleum exploration licence.

The fields, located within the Tripura asset within the Assam and Assam-Arakan basin is a gas producing

area. The major natural gas producing fields within the Tripura asset are Manikyanagar, Konaban, Agartala,

Dome and Baramura.

A39729228 184

Krishna-Godavari basin (onshore)

The Krishna-Godavari basin is located on the east coast of India and extends both onshore and offshore.

The onshore portion covers an area of approximately 15,000 sq. km. The thickness of the sedimentary fill is

approximately 5 km. The basin has extensive seismic coverage in the onshore and shallow water areas. Recently,

a number of commercial discoveries of gas have been made in the deep-water areas. As of 31 March 2019, the

Company held 39 PMLs covering an area of 4,934.75 sq. km in the on-land part of the basin.

The major producing fields within this basin are Kesanapalli West, Gopavaram, Pasarlapudi, Tatipaka,

Lingala, and Kesavadasupalem in on land area, each of which is located within the Rajahmundry asset and G-

1 and GS-15 fields in offshore areas under Eastern Offshore Asset. The hydrocarbon discoveries in these fields

were made by the Company under nomination petroleum exploration licences. The Pasarlapudi, Tatipaka, and

Kesavadasupalem fields produce natural gas only.

Cauvery Basin (on land)

The Cauvery onshore basin is located in the state of Tamil Nadu and adjoining offshore that covers an

area of approximately 25,000 sq. km. As of 31 March 2019, the Company held 29 nomination PMLs covering

an area of 3,340 sq. km in the on-land part of the basin in the state of Tamil Nadu. In addition, as of the date of

this Offering Circular, applications for four PMLs covering an area of 49 sq. km are under consideration by the

Indian Government.

The major producing fields within this basin are Kamalapuram, Kuthalam Narimanam, Thiruvarur,

Nannilam, Pallivaram Mangalam, Pundi, Kanjaramgudi, Perungulam and Periyapattinam, each of which are

located within the Kariakal asset. The Kamalapuram and Kuthalam fields are multi-layered sand reservoirs. The

hydrocarbon discovery in these fields was made by the Company under nomination petroleum exploration

licences.

Eastern Offshore Asset, Kakinada

The Company has made various discoveries in deep water areas of Krishna-Godavari basin. To

accelerate efforts in monetising the oil and gas fields in Krishna-Godavari offshore, a separate asset, i.e. Eastern

Offshore Asset (EOA), was created at Kakinada in April 2009. The “Integrated Development of G-1 and GS-

15 fields” and “Integrated development of Vashishta-S1” projects have been completed and put on production.

As of the date of this Offering Circular, the field development project of the Cluster-II fields of NELP block

KG-DWN-98/2 is under implementation.

Producing Fields held through Joint Ventures

Panna and Mukta and Mid and South Tapti, Mumbai Offshore

The Panna field, located in the Mumbai offshore basin 50 km. east of the Mumbai High field and 95 km.

north-west of Mumbai, covers an area of approximately 430 sq. km. The Mukta field, located in the Mumbai

offshore basin 110 km. north-west of Mumbai and 25 km. east of the Mumbai High field, covers an area of

approximately 777 sq. km. The Mid and South Tapti fields, located in the Mumbai offshore basin approximately

200 km. north of Mumbai, cover an area of approximately 1,471 sq. km. These fields were initially discovered

and put into production by the Company under a nomination petroleum exploration licence. Subsequently, the

Indian Government elected to offer interests in these fields to private sector participants and the Company

entered into PSCs and joint operating agreements (“JOAs”) for both the Panna and Mukta fields, and the Mid

and South Tapti fields in December 1994. The PSCs and JOAs are valid for an initial term of 25 years, subject

to extension by mutual agreement with the Indian Government. Reliance Industries Limited and BG Exploration

and Production India Limited have declined for continuation of petroleum Operations after completing the term

of PSC in December 2019. The Company has communicated its interest in continuing petroleum operations and

A39729228 185

the Indian Government has accorded approval to which Panna Mukta will be transferred to the Company by 21

December 2019.

As of 31 March 2019, the joint venture parties and their respective participating interests are set out

below:

Parties

Participating

Interest Operator

Oil and Natural Gas Corporation Limited ............................... 40.00 per cent. Joint Operator:

ONGC, BGEPIL and

RIL

BG Exploration and Production India Limited (“BGEPIL”) .. 30.00 per cent.

Reliance Industries Limited (“RIL”) ....................................... 30.00 per cent.

Ravva, Krishna-Godavari Offshore

These fields in the Krishna-Godavari basin were initially discovered and put into production by the

Company under a nomination petroleum exploration licence. Subsequently, the Indian Government elected to

offer interests in these fields to private sector participants and the Company entered into a PSC and JOA for the

Ravva field in October 1994. The PSC and the JOA are valid for an initial term of 25 years, subject to extensions

granted by the Indian Government. As all the joint venture partners were willing for PSC Extension and applied

for extension of 10 years, the Indian Government has accorded the extension of PSC for another 10 years from

October 2019. In Ravva, there is one PML in joint names with an area of 331.26 sq. km.

The major producing field within this basin is the Ravva field. The Ravva field, located off the

Amlapuram coast in the shallow waters of the Krishna-Godavari offshore block, covers an area of

approximately 331.26 sq. km.


below:

Parties

Participating

Interest Operator

Oil and Natural Gas Corporation Limited .............. 40.00 per cent.

Vedanta Ltd. (formerly known

as Cairn India Limited)

Vedanta Ltd. (formerly known as Cairn India

Limited) ..................................................................

22.50 per cent.

Videocon India Limited .......................................... 25.00 per cent.

Ravva Oil (Singapore) Pte. Ltd. ............................. 12.50 per cent.

CY-OS-90/1 (PY-3), Cauvery Offshore

The Cauvery offshore basin, located in the Bay of Bengal, covers a shallow offshore area of

approximately 30,000 sq. km and a deep water offshore area of approximately 95,000 sq. km. The Company

has made three hydrocarbon discoveries in the shallow water portion of the basin. The Company’s producing

fields in Cauvery offshore basin are generally operated through joint venture agreements.

The major producing field within the Cauvery offshore basin was the PY-3 field, prior to its shut down

on 30 July 2011 due to the expiration of the class certification for the floating production unit. The joint venture

is currently exploring the possibility of undertaking a comprehensive development for the field under various

options. The CY-OS-90/1 (PY-3) block, located 70 km. off the Pondicherry coast in the Cauvery offshore block,

covers an area of approximately 81 sq. km. The hydrocarbon discovery in this field was made by the Company

A39729228 186

prior to the issue of the Letter of Authority for commencement of Petroleum Operations. The Company entered

into a PSC and JOA for the CY-OS-90/1 (PY-3) block in December 1994. The PSC and JOA are valid for an

initial term of 25 years, subject to extension by mutual agreement with the Indian Government for a further

period not exceeding five years, provided that in the event of commercial production of non-associated natural

gas, the contract may, by mutual agreement between the parties, be extended for a period up to but not exceeding

35 years.


below:

Parties

Participating

Interest Operator


Hardy Exploration and Production

India Ltd.

Hardy Exploration and Production India Ltd. ........ 18.00 per cent.

Hindustan Oil Exploration Company Ltd. .............. 21.00 per cent.

Tata Petrodyne Limited .......................................... 21.00 per cent.

As of 31 March 2019, the Company held one PML under nomination, covering an area of 81 sq. km in

offshore part of Cauvery basin.

Block CB-OS/2, Cambay Offshore

Block CB-OS/2 is located in the Cambay offshore basin on the west coast of India in the gulf of Khambat

and covers a mining lease area of approximately 207.04 sq. km. It consists of three ring-fenced development

areas, namely Lakshmi, Gauri and CB-X. The hydrocarbon discoveries in these fields were made by the

Company under a pre-NELP petroleum exploration licence.

The Company entered into a PSC and JOA for the CB-OS/2 block in June 1998 to carry out hydrocarbon

exploration and exploitation activities in the CB/OS-2 contract area. The PSC and the JOA are valid for an

initial term of 25 years, subject to extensions granted by the Indian Government for a further period of five

years, or for a period of 35 years in the event of commercial production of non-associated natural gas.


below:

Parties

Participating

Interest Operator



as Cairn India Limited)(1)

Tata Petrodyne Limited .......................................... 10.00 per cent.


Limited)(2) ...............................................................

40.00 per cent.

RJ-ON-90/1, Barmer, Rajasthan Onshore

The RJ-ON-90/1 block, located in the Rajasthan onshore basin, covers an area of approximately 3,111

sq. km. The Company entered into a PSC and JOA for the RJ-ON-90/1 block in May 1995. The PSC and JOA

are valid for an initial term of 25 years, subject to extension by mutual agreement with the Indian Government

for a further period of five years, or for a period of 35 years in the event of commercial production of natural

gas. All joint venture partners have submitted the application for extension of PSC for next terms and the Indian

A39729228 187

Government has accorded the PSC extension for 10 years subject to agreement of certain conditions. The

Company has communicated its consent.


below:

Parties

Participating

Interest Operator



as Cairn India Limited)(1)


Limited)(2) ...............................................................

35.00 per cent.

Cairn Energy Hydrocarbons Limited ..................... 35.00 per cent.

Note:

(1) The Indian Government has approved for a change in assignment of participating interest and Change in Operatorship

from Cairn Energy India Pty Ltd to Cairn India Ltd. (“CIL”) pursuant to a letter dated 18 October 2012. The PSC

amendment for the purpose is submitted and is under examination and will be implemented on approval of PSC

amendment.

(2) Cairn India Limited has merged with Vedanta Ltd. through the National Company Law Tribunal of India order dated

23 March 2019 but the relevant PSC Amendments for transferring participating interest from CIL to Vedanta Ltd. is

under process of the Indian Government’s approval.

The associated and non-associated gas produced from this field is used for power generation, internal

heating and pipeline heating. Additionally, the joint venture has carried out extended well testing of the

Raageshwari Deep Gas (“RDG”) wells. Based on the results of extended testing, the additional gas being

produced from RDG wells is capable of being commercially sold.

A39729228 188

International Producing Areas

As of 31 March 2019, the Company held participating interests in 41 projects across 20 countries, namely

Azerbaijan, Bangladesh, Brazil, Colombia, Iran, Iraq, Israel, Kazakhstan, Libya, Mozambique, Myanmar,

Namibia, New Zealand, Russia, South Sudan, Sudan, Syria, UAE, Venezuela and Vietnam, comprising 15

producing projects, 18 exploration blocks, four discovered/development blocks and four pipeline projects. The

Company’s production shut down in three of its assets, AFPC (Syria) and Block 24 (Syria) due to the political

situation in Syria and GPOC and SPOC in South Sudan. Since 2016, the Company, through ONGC Videsh,

has:

block 32 in Israel with Licence 412/“32” dated 27 March 2018 was granted by the Petroleum

Commissioner to an Indian consortium for first phase of exploration with duration of three years. ONGC

Videsh is an operator with a participating interest of 25.00 per cent. of the Indian consortium. The other

consortium partners are BPRL, IOCL and OIL with a participating interest of 25.00 per cent. each.

participated in the Lower Zakum Concession in the UAE. ONGC Videsh has 4.00 per cent. participating

interest in the Lower Zakum Concession, offshore Abu Dhabi with effect from 9 March 2018. The

concession, which has a term of 40 years, is currently producing approximately 0.4 million bbl/d and is

to set to achieve a peak production target of 0.45 million bbl/d by 2025.

30.00 per cent. participating interest in the Namibia Petroleum Exploration Licence 0037 for Blocks

2112A, 2012B and 2113B and the related agreements and licences, offshore Namibia from Tullow

Namibia Limited, a wholly-owned subsidiary of Tullow Oil plc.

26.00 per cent. equity interest in JSC Vankorneft, a company organised in Russia which is the owner of

Vankor Field and North Vankor licence. Rosneft Oil Company, national oil company of Russia holds

50.10 per cent. equity interest in Vankorneft. An Indian consortium of Indian oil PSUs comprising OIL,

IOCL and BPRL holds the remaining 23.90 per cent. equity interest.

A39729228 189

Sudan— Greater Nile Oil Project

Blocks 1, 2 and 4, located in the Muglad basin in Sudan and South Sudan, cover an area of approximately

49,500 sq. km (the “Greater Nile Oil Project”) and are currently in production, with certain exploration

activities on going. The countries of Sudan and South Sudan were formerly one country, Sudan, which formally

separated into two independent countries on 9 July 2011. Following the separation, the southern areas of blocks

1, 2 and 4 of the Greater Nile Oil Project fall within the territories of South Sudan.

As of 31 March 2019, ONGC Videsh through its wholly-owned subsidiary, ONGC Nile Ganga B.V.,

held a 25.00 per cent. participating interest in the Greater Nile Oil Project, while CNPC International (Nile)

Limited, Petronas and Sudan National Petroleum Corporation held a 40.00 per cent. participating interest, 30.00

per cent. participating interest and 5.00 per cent. participating interest, respectively (together the “Sudan

Consortium”). In Sudan, Greater Nile Petroleum Operating Company (“GNPOC”), which the Sudan

Consortium members own in proportion to their respective interests in the Greater Nile Oil Project, operates

the project. The northern contract areas of Blocks 1, 2 and 4 (i.e. 2A, 2B, 4N), which now remained in Sudan,

have major processing facilities and crude oil transportation system including six pump stations and export

terminal at Port Sudan. GNPOC was established in 1997 as the joint operating company for the Greater Nile

Oil Project pursuant to an exploration and production sharing agreement with the Government of Sudan. The

Sudan Consortium members also signed a JOA which governs the exploration and development operations of

GNPOC. The license of Block 2B in Sudan ended on 29 November 2016 and, in accordance to the exploration

and production sharing agreement, the block was handed over to the Government of Sudan. As required by the

directives of Government of Sudan, GNPOC continued to operate and maintain the Block 2B field operations

until it was handed over to 2B OPCO, the nominated company of the Government of Sudan, on 30 November

2017. As of the date of this Offering Circular, GNPOC continues to operate the oil fields in Blocks 2A and 4,

whilst 2B OPCO operates the fields in Block-2B in Sudan.

The exploration and production sharing agreement for Blocks 2A and 4 remains valid up to November

2021. Since the year 2012, a part of the consortium’s foreign partners’ share of oil is purchased by the

Government of Sudan to meet the refinery requirement under the exploration and production sharing agreement.

However, the payments of these purchases have not been made by the Government of Sudan. As of 31 March

2019, ONGC Videsh’s portion of the outstanding receivable from the Government of Sudan amounts to

U.S.$400.00 million. ONGC Videsh along with other foreign partners of the consortium have continuously been

pursuing payments from the Government of Sudan. On 19 May 2017, ONGC Videsh served a commercial and

legal notice followed by a notice invoking arbitration to the Government of Sudan in relation to the payment.

As of the date of this Offering Circular, the arbitration proceeding, which commenced on 28 February 2018, is

still underway. Due to over lifting of the crude oil entitlement of the partners by the Government of Sudan,

ONGC Videsh requested the termination of, and the withdrawal from, the EPSA of Block 2A and 4. The request

was approved on 9 May 2019 and the termination and withdrawal process is targeted to complete by 31 August

2019.

South Sudan — Blocks 1a, 1b and 4

Blocks 1a, 1b and 4 in South Sudan is jointly operated through Greater Pioneer Operating Company

(“GPOC”), a joint venture company incorporated in Mauritius. As of 31 March 2019, ONGC Videsh through

its wholly-owned subsidiary, ONGC Nile Ganga B.V. held a 25.00 per cent. equity interest in GPOC, while the

other joint venture partners namely CNPC, Petronas and Nilepet held a 40.00 per cent. equity interest, 30.00

per cent. equity interest and 5.00 equity interest, respectively. As a result of geopolitical tension between Sudan

and South Sudan, oil productions from Blocks 1a, 1b and 4 in South Sudan were shut down for 15 months from

January 2012 to March 2013. Oil productions briefly resumed from April 2013 to December 2013 before

shutting down again for another 56 months from December 2013 to August 2018, due to adverse security

situation in the region. After the security situation improved in 2018, the Ministry of Petroleum of South Sudan

A39729228 190

and the foreign partners of the consortium agreed to restart production activities on fast-track basis. After the

reparation of damaged facilities completed, the first oil was lifted from Toma South field on 25 August 2018

and export to the marine terminal started on 15 September 2018. Since then, the Unity field, the EL-Nar field

and the El-Toor field have also been put into production on 31 December 2018, 30 April 2019 and 30 May 2019

respectively. As of 31 March 2019, ONGC Videsh’s cumulative investment into GPOC after the bifurcation

from GNPOC was U.S.$25.35 million.

South Sudan — Block 5A

Block 5A in South Sudan was acquired on 12 May 2004 and is located in the prolific Muglad basin

which spreads over an area of about 20,917 sq. km. As of 31 March 2019, ONGC Videsh held a 24.125 per

cent. participating interest in Block 5A while the other partners namely Petronas and Nilepet held a 67.875 per

cent. participating interest and 8.00 per cent. participating interest, respectively. Block 5A is jointly operated by

all partners through the joint operating company, SUDD Petroleum Operating Company (“SPOC”). Similar to

Blocks 1, 2 and 4 in South Sudan, developments of Blocks 1, 2 and 4 were only effectively commenced after

the Ministry of Petroleum of South Sudan and the foreign partners of the consortium agreed to restart production

activities on fast-track basis in 2018. As of the date of this Offering Circular, technical assessment and

environment assessment of Tharjath and Mala oil fields of Block 5A have been completed and preliminary steps

for the resumption of operation are in progress.

Russia — Sakhalin-I

The Sakhalin-I project, located in Russia, consists of three fields (Odoptu, Chavyo and Arkutun-Dagi)

covering an area of approximately 1,146 sq. km, all of which are currently in production. As of 31 March 2019,

ONGC Videsh held a 20.00 per cent. participating interest in the project while ExxonMobil, Sodeco (a

consortium of Japanese companies) and Rosneft Oil Company (through its subsidiaries) held a 30.00 per cent.

participating interest, 30.00 per cent. participating interest and 20.00 per cent. participating interest, respectively

(together the “Sakhalin Consortium”). ExxonMobil is the operator of the project.

The production sharing agreement for the Sakhalin-I project was signed on 30 June 1995, and the

commerciality of the blocks was declared in 2001. The initial term of the production sharing agreement is 20

years (up to 2021), commencing from the date of declaration of commerciality, subject to extensions to the

extent that commercially exploitable hydrocarbons continue to be present in the project. In 2017, the Sakhalin

Consortium received an approval for three consecutive ten years of extension, extending the licence of the

project until 3 December 2051 with the fixed profit tax rate of 35.00 per cent. The consortium has submitted

production plans and reserves reports to the relevant authorities showing the existence of sufficient reserves to

continue production until 2055.

Under the production sharing agreement (the “PSA”), a royalty of 8.00 per cent. of value of production

determined in accordance with the applicable PSA provisions is payable to the Government of Russia. The

consortium’s operating expenses, capital costs, and abandonment costs are recoverable from the consortium’s

revenues available for sharing, subject to certain limits in the PSA. The remaining production (i.e. profit from

oil/gas) of the project is available for sharing among the consortium and the Government of Russia in

accordance with the PSA depending upon the internal rate of return of the project. The profits from the project

as determined under the PSA is subjected to profit tax in Russia.

The production sharing agreement may be terminated by the Government of Russia, subject to a 90-day

rectification period, under the following circumstances: (i) assignment to a third party in breach of the

provisions of the production sharing agreement; (ii) intentional presentation of materially false information to

the state in relation to hydrocarbon operations; (iii) repeated and significant breach of the production sharing

agreement; and (iv) stoppage of hydrocarbon operations for a period of over 360 consecutive days (except as a

result of force majeure).

A39729228 191

Russia — Imperial Energy

In 2009, ONGC Videsh acquired Imperial Energy, an independent upstream oil exploration and

production company having its main activities in the Tomsk region of Western Siberia, Russia. As a result of

this transaction, ONGC Videsh acquired a total of 14 licences covering an area of approximately 16,800 sq. km,

of which five are exploration and production licences, three are geological study, exploration and production

licences and six are prospecting and appraisal licences which ONGC Videsh holds through a number of Russian

subsidiaries. Two largest producing fields were the Mayskoe field and Snezhnoye field, the licenses to which

expires in 2027 and 2029, respectively. As of the date of this Offering Memorandum, Imperial Energy holds 10

licence blocks in the Tomsk region with a total licenced area of approximately 11,038 sq. km, four of which are

exploration and production licences, three of which are geological study, exploration and production licenses

and the remaining three of which are prospecting and appraisal licences. The three prospecting and appraisal

licences are valid until 31 December 2022.

ONGC Videsh must obtain licences from Russian governmental authorities to explore and produce crude

oil and natural gas from the fields. Exploration licences give licensees the exclusive right to explore resources

from the fields/blocks in a defined licensing area and are valid for about five years from issuance and

registration. Production licences give the licensees the exclusive right to extract resources from subsoil fields

in a defined area and are valid for approximately 20 years from issuance. Combined licences permit both

exploration and production and are valid for about 25 years from issuance. The Russian subsidiaries’ production

and combined licences expire between 2027 and 2038.

Production and combined licences require, inter alia: extracting annually an agreed target amount of

reserves; conducting agreed minimum drilling and other exploration and development activities; protecting the

ecology in the fields from damage and meeting certain environmental requirements; providing geological

information and data to the relevant authorities; submitting on a regular basis formal progress reports and

geological data to regional authorities; performing certain obligations according to certain “social

responsibility” undertakings and paying the mineral resources extraction tax and other local and federal charges

when due.

The economic lives of the Russian subsidiaries’ licensed fields can extend significantly beyond the

licence expiration dates. Under Russian law, the holder of the licence is entitled to renew the licenses to the end

of the economic lives of the fields, provided that certain conditions are met. Article 10 of the Russia’s Subsoil

Law provides for that a licence to use a field ‘shall be’ extended at its scheduled termination at the initiative of

the subsoil user if necessary to finish production of the field, provided that there are no violations of the

conditions of the licence (licensing agreement).

For a discussion of risks relating to the Russian subsidiaries’ licences, see “Investment Considerations

— Risks relating to the Company’s Business — Exploration activities in Russia involve numerous risks,

including the risk that the Company’s crude oil and natural gas fields in Russia will be re-assessed and declared

as fields of “federal importance”. In addition, the Company’s exploration and production licenses in Russia

may be suspended, amended or terminated prior to the end of their terms, and it may be unable to obtain or

maintain various permits and authorisations”. For further information on material Russian regulations, see

“Relationship with the Government and Certain Related Party Transactions”.

Russia — JSC Vankorneft

In May 2016, ONGC Videsh completed the acquisition of 15.00 per cent. equity interest from Rosneft

Oil Company in JSC Vankorneft, a company organised under the law of Russia which is the owner of Vankor

Field and North Vankor licences, for a consideration of U.S.$1,268 million (subject to adjustments and with a

value date of 31 May 2015). The actual payment on closing date was U.S.$1,084.91 million after deduction of

agreed head-room amount of U.S.$63.40 million from the estimated consideration. In October 2016, ONGC

A39729228 192

Videsh further acquired 11.00 per cent. equity interest in JSC Vankorneft, for an actual payment of U.S.$827.20

million (after adjustment against the initial consideration price of U.S.$930.00 million). As of 31 March 2019,

ONGC Videsh held a 26.00 per cent. equity interest in JSC Vankorneft while Rosneft and an Indian consortium

of IOCL, OIL and BPRL held a 50.10 per cent. equity interest and 23.90 per cent. equity interest, respectively.

Vankor is one of Russia’s largest fields by production. For the 2019 Fiscal Year, JSC Vankorneft’s

average oil and gas production rates were 324,563 bbl/d and 17.49 MMSCMD respectively. As of 31 March

2019, ONGC Videsh’s share in 2P reserves of Vankor was 78.905 MMT of oil and 22.875 BCM of gas. ONGC

Videsh’s 26.00 per cent. equity interest in the crude oil (including Condensate) and natural gas production for

the 2019 Fiscal Year amounted to 4.140 million tonnes and 1.66 BCM respectively.

Vietnam — Block 06.1

Block 06.1, located offshore Vietnam, covers an area of approximately 955 sq. km and contains three

gas fields, Lan Tay, Lan Do and Phong Lan Dai fields. Commercial production from these fields started from

2002, 2012 and 2018 respectively. The average gas production rate from this block is 9.44 MMSCMD and the

Condensate production rate is 869 bbl/d during the 2019 Fiscal Year. As of 31 March 2019, ONGC Videsh held

a 45.00 per cent. participating interest in the block, while Rosneft Vietnam B.V. and PetroVietnam held a 35.00

per cent. participating interest and 20.00 per cent. participating interest, respectively. Rosneft Vietnam B.V.

(Rosneft) is the operator of Block 06.1. On 16 May 2019, the consortium commenced an exploration drilling

campaign of an Exploratory Well (PLDCC -1X) in Clastics prospect of PLD field. Currently, the drilling

operations are still underway.

The term of the PSC is 35 years from 1988, subject to further extension. Under the terms of the PSC,

ONGC Videsh and Rosneft Vietnam B.V. are entitled to up to 50.00 per cent. of the annual gross production of

crude oil and natural gas as cost recovery.

Revenues with respect to natural gas and crude oil production in excess of recovered costs in a given

period are divided between Rosneft Vietnam B.V. and ONGC Videsh, as the non-governmental participants,

and PetroVietnam as follows:

Profit sharing of natural gas Petro Vietnam

Rosneft

Vietnam

B.V./ONGC

Videsh /

PetroVietnam

(per cent.) (per cent.)

For gross production up to and including 1.3 BCM/year .......................................... 50.00 50.00

For additional gross production above 1.3 BCM/year up to and including 2.0

BCM/year ................................................................................................................. 55.00 45.00


BCM/year ................................................................................................................. 60.00 40.00


BCM/year ................................................................................................................. 65.00 35.00

For additional gross production above 3.0 BCM/year .............................................. 70.00 30.00

A39729228 193

Profit sharing of oil

(gross production of crude oil in barrels of oil per day (bbl/d) Petro Vietnam

Rosneft

Vietnam B.V./

ONGC

Videsh/

PetroVietnam

(per cent.) (per cent.)

< 10,000 .................................................................................................................... 50.00 50.00

10,000 - 50,000 ......................................................................................................... 60.00 40.00

50,000 - 70,000 ......................................................................................................... 65.00 35.00

70,000 - 100,000 ....................................................................................................... 70.00 30.00

Over 100,000 ............................................................................................................ 80.00 20.00

Venezuela — San Cristobal project

The San Cristobal project, located in the Orinoco heavy oil belt of Venezuela, consists of one block

covering an area of approximately 160 sq. km and is currently in production. As of 31 March 2019, ONGC

Videsh held a 40.00 per cent. participating interest in Petrolera IndoVenezolana S.A, while Corporacion

Venezolana Del Petroleo, S.A. (a subsidiary of Venezuela’s state oil company) and PdVSA Social held a 56.00

per cent. participating interest and 4.00 per cent. participating interest, respectively. Petrolera IndoVenezolana

S.A., a joint venture company established in 2008 and owned by ONGC Videsh and Corporacion Venezolana

Del Petroleo, S.A. in proportion to their respective participating interests in the project, operates the project.

The term of the license expires in April 2033. As of 31 March 2019, the San Cristobal project has produced

130.5 million bbls.

Colombia — Mansarovar Energy project

The Mansarovar Energy project, located in Colombia, consists of two blocks covering an area of

approximately 197 sq. km and is currently in production stage. Mansarovar Energy Colombia Limited

(“MECL”) is a joint venture company between ONGC Videsh and Sinopec International Petroleum Exploration

and Production Corporation, a subsidiary of Sinopec. ONGC Videsh acquired 50.00 per cent. share in MECL

in August 2006. As of 31 March 2019, ONGC Videsh held a 50.00 per cent. equity interest in MECL. MECL

owns 100.00 per cent. interest in Velasquez field and the Velasquez-Galan pipeline with a capacity of 55,000

bbl/d and runs 189 km from the Velasquez property to Ecopetrol’s Barrancabermeja refinery.

Additionally, as of 31 March 2019, MECL held a 50.00 per cent. participating interest in the Nare

Association Contract (whereby Ecopetrol is the joint venture partner with a 50.00 per cent. participating

interest). The Nare Association Contract covers the commercial fields in Moriche, Girasol, Jazmin, Nare Sur,

Under River and Abarco as well as non-commercial area in Chicala within the Middle Magdalena basin. The

license for the Nare Association Contract expires in November 2021.

Brazil — Block BC-10

Block BC-10, located in Brazil, consists of one block covering an area of approximately 266 sq. km and

is currently in production stage. This is a deep-water offshore block located in the Campos basin approximately

120 km southwest from the city of Vitoria off the coast of Brazil with a water depth of around 1,800 metres. As

of 31 March 2019, ONGC Videsh held a 27.00 per cent. participating interest (acquired 15.00 per cent. in 2006

and further 12 per cent. in 2013) in the project, while Shell and Qatar Petroleum International held a 50.00 per

cent. participating interest and 23.00 per cent. participating interest, respectively. Shell operates the Block BC-

10’s first infill drilling campaign consisting of two wells, the ON-11 well and the BW-3 well, which started on

7 March 2019. As of the date of this Offering Circular, the infill drilling campaign on the two wells have been

A39729228 194

completed of which one well has been put on production with the other well likely to be put on production by

the end of August 2019. The licence for this block will expire in December 2032.

Syria — Al Furat Petroleum

The project is owned by Himalaya Energy Syria B.V. (“HESBV”), a joint venture company established

by ONGC Nile Ganga B. V. and Fulin Investments Sarl., a subsidiary of CNPC. As of 31 March 2019, ONGC

Nile Ganga B. V. held a 50.00 per cent. equity interest in HESBV. The project was acquired in July 2005 under

a PSA with 36.00 per cent. participating interest held by HESBV and 64.00 per cent. held by Shell Syria

Petroleum Development Company. The fields are operated by Al Furat Petroleum Company, a joint venture

company of Syrian Petroleum Company (the national oil company of Syria), Shell Syria Petroleum

Development Company and HESBV.

In September 2011, the European Union imposed oil trade sanctions on Syria. The EU sanctions were

specifically targeted at crude oil exports making vessel availability, associated insurance and payment extremely

difficult. The European Union further imposed enhanced sanctions on Syria on 1 December 2011 and also

included Al Furat Petroleum Company and General Petroleum Company in the list of sanctioned Syrian entities.

Since the sanctions being imposed, operations were stopped by foreign partners of the joint venture.

During the 2019 Fiscal Year, the project continued remains in a shutdown. There is no production from

Al Furat Petroleum Company’s oil fields due to the continuing political and security issues in the area. It is

expected that the operations will only continue once the political and security situation have been normalised

and the sanctions imposed to Syria is lifted.

Lower Zakum Concession, Abu Dhabi

Zakum is a supergiant offshore field of Abu Dhabi discovered in 1963 and is divided into two

concessions, the Upper Zakum Concession and the Lower Zakum Concession. A joint venture company, Falcon

Oil and Gas B.V. (“FOG”) was established by ONGC Videsh, IOCL and BPRL. As of 31 March 2019, ONGC

Videsh held a 40.00 per cent. equity interest in FOG, while IOCL and BPRL each held a 30.00 per cent. equity

interest. In February 2018, FOG acquired a 10.00 per cent. participating interest in the Lower Zakum

Concession. The concession has a term of 40 years with an effective date of 9 March 2018. As of 31 March

2019, the other shareholders/concession holders in Lower Zakum Concession were ADNOC (with a 60.00 per

cent. participating interest), INPEX (with a 10.00 per cent. participating interest), CNPC (with a 10.00 per cent.

participating interest), Total (with a 5.00 per cent. participating interest) and Eni (with a 5.00 per cent.

participating interest). After a year since incorporation, Falcon Oil and Gas B.V. was able to declare dividend

to its shareholders amounting to U.S.$30 million.

Azerbaijan — ACG Fields and BTC Pipeline

The ACG Fields are located in the south Caspian Sea, approximately 95 km off the coast of Azerbaijan

and cover an area of approximately 435 sq. km. The ACG Fields are the largest oil and gas field complex in

Azerbaijan and are one of the largest producing oil fields in the world. The term of the licence for the fields

expires in December 2049. The 1,768 km BTC Pipeline is one of the main export routes for Caspian crude oil,

with a capacity of 1.2 million bbl/d, to the Ceyhan terminal in the Mediterranean Sea in southeast Turkey.

ONGC Videsh acquired a 2.72 per cent. participating interest of Hess Corporation in the ACG Fields and a 2.36

per cent. participating interest in the BTC Pipeline in March 2013. Since the PSA extension in 2017 and as of

31 March 2019, ONGC Videsh only held a 2.31 per cent. participating interest in the ACG fields. The ACG

Fields is operated by British Petroleum and partnered with SOCAR, Chevron, Statoil, ExxonMobil, Inpex,

TPAO, Itochu and ONGC Videsh.

A39729228 195

Myanmar — Blocks A-1 and A-3

Blocks A-1 and A-3, located on the coast of Myanmar, are two adjacent blocks covering an area of

approximately 2,129 sq. km and 3,441 sq. km, respectively. ONGC Videsh acquired 20.00 per cent. participating

interest in the Block A1 and Block A3 in Myanmar from Daewoo International Corporation in 2002 and 2006

respectively. Post discovery and declaration of commerciality in 2009, Myanmar Oil and Gas Enterprise

(“MOGE”) exercised its back-in rights with 15.00 per cent. participating interest. As of 31 March 2019, the

consortium which operates Blocks A-1 and A-3 consisted of POSCO International (with a 51.00 per cent.

participating interest), ONGC Videsh (with a 17.00 per cent. participating interest), MOGE (with a 15.00 per

cent. participating interest), GAIL (with a 8.50 per cent. participating interest) and Korea Gas Corporation (with

a 8.50 per cent. participating interest). The overall development project for Blocks A-1 and A-3 consists of two

components, field development and offshore pipeline transportation which will connect the delivery point of

the offshore platform with the gas sales point in Ramree Island. The development of these blocks was planned

under three phases:

Phase-I: a total of 14 Development Wells were drilled for the Phase-I development drilling campaign.

A 110 km long and 32-inch diameter offshore pipeline (Pipeco-I) was laid between the offshore

processing platform and the onshore gas terminal. The Mya North field and the Shwe field have been

producing since 15 July 2013 and 10 January 2014 respectively. A peak production of 500 MMSCFD

was reached in December 2014. The Phase-I drilling campaign was completed in December 2015.

Phase-II (revised): in order to maintain a daily contract quantity of 500 MMSCFD, eight wells will be

drilled, four wells in Shwe and the remaining four wells in Shwe Phyu. Production add-on from Shwe

and Shwe Phyu field of Block A1 are expected to commence in April 2021 and April 2022 respectively.

Engineering, procurement, construction, installation and commissioning commenced in July 2018 and

drilling activities will be initiated from December 2019.

Phase-III: for the Phase III development, the block operator is expected to complete the installation of

LP compressor, platform (SHK), topside and jacket fabrication and installation, connecting bridge with

SHP processing platform, brownfield modification at SHP facility to tie in SHK interfaces, piping and

utilities etc. to maintain the daily contract quantity of 500 MMSCFD from July 2025 onwards.

A new exploration programme has also been initiated to add additional gas pools to the reserves. As of

the date of this Offering Circular, three Exploratory Wells have been finalised in block A-3 for drilling.

Exploration drilling will start in the first quarter of 2020 and will be completed by the first quarter of 2021.

Pipeco-1, Myanmar

Pipeco-1 is an unincorporated joint venture between the consortium partners of Block A1 and A3 and is

a part of the combined development of the blocks. ONGC Videsh acquired 17.00 per cent. participating interest

in the project in July 2013. As of 31 March 2019, ONGC Videsh held a 17.00 per cent. participating interest in

the project, while POSCO International (the operator of the block), MOGE, GAIL and Korea Gas Corporation

holding a 51.00 per cent. participating interest, 15.00 per cent. participating interest, 8.50 per cent. participating

interest and 8.50 per cent. participating interest, respectively. As a part of the project, a 110 km length and 32-

inch gas trunk transportation pipeline with a maximum capacity of 960 MMSCFD has been constructed and is

being used for transportation of gas from Shwe offshore platform to the land fall point at Ramree Island.

Pipeco-2, Myanmar

Pipeco-2 is an onshore pipeline that runs from Ramree island to Ruilli at the Myanmar-China border.

This inter-state gas pipeline (with a length 792 km and a diameter of 40 inch) has a design capacity of 1,160

MMSCFD. The pipeline is expected to enable gas export from Blocks A1 and A3 in Myanmar to China. The

pipeline project is held by South East Asia Gas Pipeline Company Limited. As of 31 March 2019, ONGC Videsh

A39729228 196

holds 8.347 per cent. participating interest in the project with CNPC (the operator of the project) holding a

50.90 per cent. participating interest.

Sudan — Pipeline project

ONGC Videsh entered into a pipeline contract agreement with the Ministry of Energy and Mining of

Sudan on 30 June 2004 for construction of 12-inch diameter, 741 km. long Khartoum – Port Sudan multi-

product pipeline system on an engineering, procurement and construction basis. The project was financed by

ONGC Videsh and OIL with a split of 90.00 per cent. and 10.00 per cent. respectively. The project was

completed on 31 August 2005, two months ahead of the contractual completion schedule of 31 October 2005

and the pipeline system was commissioned by the Ministry of Energy and Mining of Sudan on 15 October

2005.

The total amount, including lease rental of the project, to be paid by the Government of Sudan was

approximately U.S.$254.42 million. The payment was made in semi-annual instalments amounting to

U.S.$14.135 million each starting from 30 December 2005. As of the date of this Offering Circular, a total of

11 instalments up to 30 December 2010 (amounting to approximately U.S.$155.48 million) has been received

from the Government of Sudan. The remaining seven instalment payments due from June 2011 to June 2014

(amounting to approximately U.S.$98.94 million excluding the accrued interest payable on such delayed

payment up to the actual payment date) has not been paid by the Government of Sudan.

ONGC Videsh has been making efforts, including diplomatic support, to recover the outstanding

instalment payments. On 19 May 2017, ONGC Videsh has served commercial and legal notices followed by a

notice invoking arbitration to the Government of Sudan in relation to the payment. As of the date of this Offering

Circular, the arbitration proceeding, which commenced on 28 February 2018, is still underway.

Exploration and Development

The following table sets forth certain information relating to the Company’s domestic and international

exploration and development drilling:

2017 Fiscal

Year

2018 Fiscal

Year

2019 Fiscal

Year

Exploratory Wells

Domestic

Productive ........................................................................ 44 54 35

Dry ................................................................................... 47 54 40

Others ............................................................................... 9 11 30

International

Productive ........................................................................ 2 3 2

Dry ................................................................................... - 2 2

Total Exploratory Wells ................................................. 102 124 109

Development Wells

Domestic

Productive ........................................................................ 390 380 405

Dry ................................................................................... 11 4 6

A39729228 197

2017 Fiscal

Year

2018 Fiscal

Year

2019 Fiscal

Year

International

Productive ........................................................................ 113 119(1) 110

Dry ................................................................................... - - -

Total Development Wells ................................................ 514 503 521

Total wells ........................................................................ 616 627 630

Note:

(1) In the 2018 Fiscal Year, the actual number of Development Wells shown in “Budget Outlays – Revised Estimates (RE)” for the

2019 Fiscal Year and Budget Estimates (BE) for the 2019 Fiscal Year for the Lower Zakum Concession project is 6 and these have

been considered as productive wells.

Domestic Exploration and Development

India has a total of 26 sedimentary basins. The basins in India are categorised into three categories in

line with the global industry standard of the Petroleum Resources Management System guidelines on petroleum

resources reporting as: Category-I (comprising seven basins having recoverable commercial discovered in-

place and reserves); Category-II (comprising five basins having recoverable sub-commercial discovered in-

place with Contingent Resources), and Category-III (comprising 14 basins which have only recoverable

undiscovered in-place). The Company held acreages for domestic exploration and production activities in all

seven of India’s Category-I basins, namely the Krishna-Godavari basin, the Mumbai offshore basin, the Assam

Shelf basin, the Rajasthan basin, the Cauvery basin, Assam Shelf and Assam-Arakan fold belt, and Cambay

basin.

The Company is also undertaking several domestic exploration activities in Category-II basins, including

the Saurashtra basin, the Kutch basin and the Vindhyan basin. During the 2019 Fiscal Year, the Company’s

exploration efforts resulted in the discovery of two oil wells, GKS09NFA-1 well in the Kutch offshore basin

and Hatta-2 well in the Vindhyan basin. The Company also held acreages for domestic exploration in Category-

III such as the Bengal basin and the Himalayan Foreland basin. In 2018, the Company made a breakthrough in

the Bengal basin with the discovery of the first commercially-viable flow of hydrocarbons in Asokenagar-1 in

NELP block WB-ONN-2005/4 in the state of West Bengal. The discovery has led the Bengal basin to be

included on the hydrocarbon map of India, which will result in the basin upgrading to Category-II.

As of 31 March 2019, the Company held exploration licences for nine nomination blocks (five onshore

and four offshore), two OALP blocks and 19 NELP blocks (9 onshore and 10 offshore). Of the 10 offshore

blocks for which the Company holds exploration licences, one block is located in deep water and/or ultra-deep

water and 9 blocks are located in shallow water areas. In addition, the Company also held and operated one

onshore pre-NELP block as of 31 March 2019. The onshore exploration acreages are spread out across the states

of Andhra Pradesh, Assam, Gujarat, Himachal Pradesh, Madhya Pradesh, Nagaland, Mizoram, Rajasthan, Tamil

Nadu Tripura and West Bengal. For the 2017 Fiscal Year, the 2018 Fiscal Year and the 2019 Fiscal Year, the

Company has made 23, 12 and 13 notified hydrocarbon discoveries, respectively.

Onshore basins

Cambay basin

As of 31 March 2019, the Company was undertaking exploration activities in 2 NELP blocks covering

271.36 sq. km which is under exploration, and 174 PML blocks covering 5,880.29 sq. km (including five PMLs

A39729228 198

converted from NELP acreages) under development and production. In addition, the Company held one PML

converted from NELP in Gulf of Cambay covering 243 sq. km.

As of 31 March 2019, the Company has acquired 106,818.30 ground line km of 2D Seismic Data,

13,214.73 sq. km of 3D Seismic Data and drilled 2,719 Exploratory Wells in Cambay basin. As a result, a total

of 1,426 Exploratory Wells were found to be oil and gas bearing wells, including 152 new hydrocarbon well

discoveries (116 prospects and 36 pools).

For the 2020 Fiscal Year, the Company plans to acquire 310 sq. km of 3D Seismic Data, drill 27

Exploratory Wells including four shale gas wells in this basin. For a description of the basin, see “—Owned

and Operated Onshore Producing Fields”.

Jaisalmer basin

The Company is currently pursuing exploration and development activities in the Jaisalmer basin. As of

31 March 2019, the Company is a licensee and holds participating interest in one pre-NELP block and operates

four nomination PMLs. As of 31 March 2019, the Company has acquired a total of 23,125.68 ground line km

of 2D Seismic Data, 1,875.80 sq. km of 3D Seismic Data and drilled 88 Exploratory Wells. As a result, a total

of 30 wells are hydrocarbon bearing wells, including eight new well discoveries (seven prospects and one pool).

For the 2020 Fiscal Year, the Company plans to acquire 115 sq. km of 3D Seismic Data and drill three

Exploratory Wells in this basin. For a description of this basin, see “—Owned and Operated Onshore Producing

Fields”.

Vindhyan Basin

As of 31 March 2019, the Company pursued exploration in one NELP block covering 462 sq. km in Son

valley of Vindhyan basin, in the state of Madhya Pradesh. In addition, the Company also operates one

nomination PML covering 1,135 sq. km in the basin, in the state of Madhya Pradesh. Since 2018, the Company

has made new prospect discovery in the VN-ONN-2009/3 NELP block through the Hatta-2 well.

As of 31 March 2019, the Company has acquired a total of 9,549.28 ground line km of 2D Seismic Data,

1,426.95 sq. km of 3D Seismic Data and drilled 25 Exploratory Wells in this basin. As a result, seven

Exploratory Wells are proved to be gas bearing wells, including four new gas well discoveries (Nohta-2,

Damoh-4, Jabera-4 and Hatta-2).

For the 2020 Fiscal Year, the Company plans to acquire 45 sq. km of 3D Seismic Data and drill one

Exploratory Well in its operated acreage in this basin. For a description of the basin, see “Owned and Operated

Onshore Producing Fields”

Assam and Assam-Arakan basin

As of 31 March 2019, the Company held 64 nomination PML blocks, covering 5,926.11 sq. km

spreading across three states, Assam (46 PMLs), Tripura (17 PMLs) and Nagaland (one PML). The Company

operates seven exploration blocks comprising two NELP blocks covering an area of 3,620 sq. km (one block

covering 960 sq. km in Tripura and one block covering 2660 sq. km in Mizoram), one Pre-NELP block covering

892 sq. km (637 sq. km in Assam and 255 sq. km in Mizoram) and four nomination PELs (one PEL in Assam

and three PELs in Nagaland) covering a total area of 1677.05 sq. km. Additionally, the Company has

participating interest in two NELP blocks in Assam where the consortium partner is the operator.

The Company’s exploration activities under nomination are currently suspended in Nagaland until a

memorandum of understanding is signed with the Nagaland Government. At present, the Indian Government is

considering granting the Company an extension in the Mizoram block.

A39729228 199

As of 31 March 2019, the Company has acquired a total of 39,336.36 ground line km of 2D Seismic

Data, 5,944 sq. km of 3D Seismic Data and has drilled 995 Exploratory Wells in the state of Assam. As a result,

the Company has made 89 new well discoveries (63 prospects and 26 pools).

For the 2020 Fiscal Year, the Company plans to acquire 60 line km of 2D, 521 sq. km of 3D Seismic

Data and to drill 25 Exploratory Wells in its operated acreages in the state. For description of this basin, see “—

Owned and Operated Onshore Producing Fields”.

Cauvery basin

As of 31 March 2019, the Company held 29 nomination PML blocks, covering 3,340.23 sq. km In

addition, the Company operates two NELP blocks, covering 266.8 sq. km and one OALP block covering 731

sq. km in the Cauvery onshore.

As of 31 March 2019, the Company has acquired 42,741 ground line km 2D Seismic Data, 9,344 sq. km

of 3D Seismic Data and drilled 542 Exploratory Wells in the state. As a result, a total of 175 wells were found

to be hydrocarbon bearing wells, including 48 new well discoveries (35 prospects and 13 pools) in the onshore

part of this basin.

For the 2020 Fiscal Year, the Company plans to drill eight Exploratory Wells in this basin. For description

of this basins see “— Owned and Operated Onshore Producing Fields”.

Krishna-Godavari Basin

As of 31 March 2019, the Company operates in 39 nomination PML blocks, covering 4,934.75 sq. km

including one NELP block which has been wholly converted into PML.

As of 31 March 2019, the Company has acquired 39,231.8 ground line km of 2D Seismic Data,

10,391.91 sq. km of 3D Seismic Data and drilled 476 Exploratory Wells. As a result, a total of 202 wells were

found to be hydrocarbon bearing wells including 80 new well discoveries (65 prospects and 15 pools) made on

the onshore part of his basin.

For the 2020 Fiscal Year, the Company plans to acquire 250 line km of 2D Seismic Data, 210 sq. km of

3D Seismic Data and drill 16 Exploratory Wells including two wells for shale gas /oil potential assessment in

this basin. For description of this basins see “— Owned and Operated Onshore Producing Fields”.

Bengal Basin

As of 31 March 2019, the Company operates in two NELP blocks, covering 7941.0 sq. km. As of 31

March 2019, the Company has acquired 33,662.69 ground line km of 2D Seismic Data, 4,187.37 sq. km of 3D

Seismic Data and drilled 42 Exploratory Wells. These exploration efforts have resulted in the discovery of

hydrocarbon in Asokenagar-1 well in NELP block WB-ONN-2005/4 for the 2019 Fiscal Year. With this

discovery the Company has opened a new basin on the hydrocarbon map of India. For the 2020 Fiscal Year, the

Company plans to drill one Exploratory Well in this basin.

Himalayan Foreland Basin

The Company operates exploration activities in one nomination PEL covering an area of 1,828 sq. km.

The Company drilled the first well, Jwalamukhi-1, in 1957 and encountered two shallow low-pressure gas pools

in the Lower Siwalik section, which were non-commercial. The gas was mostly methane with traces of higher

hydrocarbons. Since then, 12 more Exploratory Wells and five structural wells have been drilled in the basin

without any success. For the 2020 Fiscal Year, the Company plans to drill one Exploratory Well in its operated

acreages in this basin.

A39729228 200

Offshore Basins

Mumbai Offshore Basin

As of 31 March 2019, the Company operates in 25 nomination PML blocks, covering 28,677.4 sq. km.

In addition, the Company operated in two nomination deep-water PEL blocks, covering an area of

approximately 16,488 sq. km, one OALP block covering an area of 725 sq. km and one shallow-water NELP

block, covering an area of approximately 1685 sq. km.

As of 31 March 2019, the Company has acquired 264,543 line km of 2D Seismic Data (232,919 line km

in shallow-waters and 31,624 line km in deep-waters), 79,341.41 sq. km of 3D Seismic Data (716,36.36 sq. km

in shallow-waters and 7,705.05 sq. km in deep-waters) and 933 Exploratory Wells have been drilled (931 in

shallow-waters and two in deep-waters). As a result, 394 wells were found to be hydrocarbon bearing wells,

including 122 new well discoveries (104 prospects and 18 pools).

For the 2020 Fiscal Year, the Company plans to acquire 2,450 sq. km of 3D Seismic Data and drill 28

Exploratory Wells. For description of this basin, see “—Owned and Operated Offshore Producing Fields”.

Kutch-Saurashtra Offshore Basins

The Company commenced its exploration activity in the basin in 1965 and made its first commercial

discovery of hydrocarbons in 1984. As of 31 March 2019, the Company operates in one nomination PML

blocks, covering 2276.6 sq. km. In addition, the Company held five shallow water NELP blocks, covering

4546.0 sq. km.

As of 31 March 2019, the Company has acquired 77,848.76 line km of 2D Seismic Data and 30,921.94

sq. km of 3D Seismic Data in the Kutch-Saurashtra offshore basins. The Company has drilled a total of 111

Exploratory Wells (106 in shallow-waters and five in deep-waters). As a result, a total of 33 Exploratory Wells

were found to be hydrocarbon bearing wells, including 23 new well discoveries (15 prospects and eight pools).

For the 2020 Fiscal Year, the Company does not have any exploration activity planned in Kutch-

Saurashtra offshore basin.

Cauvery Offshore Basin

As of 31 March 2019, the Company operates one PML covering an area of 85.83 sq. km. A of 31 March

2019, the Company has acquired 97,392 line km (32,671 line km in shallow-waters and 64,721 line km in deep-

waters) of 2D Seismic Data, 17,061 sq. km (1,952 sq. km in shallow-waters and 15,109 sq. km in deep-waters)

of 3D Seismic Data and drilled 64 Exploratory Wells (59 in shallow-waters and five in deep-waters) in the

Cauvery offshore basin. As a result, eight Exploratory Wells were hydrocarbon bearing wells, including three

new well discoveries. For description of this basin, see “—Producing Fields held through Joint Ventures”.

Krishna-Godavari Offshore Basin

As of 31 March 2019, the Company operates four NELP blocks (three in shallow-waters and one in

deep-waters) including KG-OSN-2001/3 block acquired from GSPC covering 3,740.87 sq. km and one

nomination PEL block, KG-OS-DW-III in Krishna-Godavari deep-water covering 283.05 sq. km. In addition,

the Company held 13 PML blocks (10 in shallow-waters and three in deep-waters) covering 2,063.26 sq. km,

including two PMLs awarded in NELP blocks (Cluster-II of KG-DWN-98/2 and KG-OSN-2001/3).

The Company’s exploration of the Krishna-Godavari offshore basin commenced in 1979 and the first

deep water discovery of G-1 field was made in 1980 and a second discovery of substantial accumulation of

hydrocarbons at the Ravva field in Krishna-Godavari offshore basin was made in 1987.

As of 31 March 2019, the Company has acquired a total of 89,686 line km (33,227 line km in shallow-

waters and 56,459 line km in deep-waters) of 2D Seismic Data, 43,087.32 sq. km (5,291.21 sq. km in shallow-

A39729228 201

waters and 37,796.11 sq. km in deep-waters) of 3D Seismic Data, 500 sq. km of CSEM data and drilled 274

Exploratory Wells (180 in shallow-waters and 94 in deep-waters) in the offshore part of the Krishna-Godavari

basin. As a result, a total of 115 wells were found to be hydrocarbon bearing including 67 new well discoveries

(45 prospects and 22 pools). Additionally, the Company holds 13 prospect discoveries made by other operators

(four discoveries in NELP block KG-DWN-98/2 and nine discoveries in KG-OSN-2001/3).

For the 2020 Fiscal Year, the Company plans to acquire 500 sq. km (100 in shallow-waters, 400 in deep-

waters) of 3D Seismic Data and drill seven (three in shallow-waters and four in deep-waters) Exploratory Wells

in its operated acreages in the Krishna-Godavari offshore part of the basin. For description of this basin, see

“—Producing Fields held through Joint Ventures”.

International Exploration and Development

Mozambique — Rovuma Area-1 Offshore Block

ONGC Videsh and OIL together acquired 100.00 per cent. shares in Beas Rovuma Energy Mozambique

Limited (“BREML”) on 7 January 2014, where ONGC Videsh held 60.00 per cent. of the shares in BREML.

BREML holds a 10.00 per cent. participating interest in the Rovuma Area-1 offshore block in Mozambique.

ONGC Videsh subsequently acquired an additional 10.00 per cent. participating interest from Anadarko

Mozambique Area-1 Limited (“Anadarko”) on 28 February 2014. With this additional acquisition, as of 31

March 2019, ONGC Videsh’s net participating interest in the Rovuma Area-1 offshore block in Mozambique

amounted to 16.00 per cent.

The Mozambique Rovuma Area-1 offshore block is situated in the deep-water Rovuma basin in

Mozambique. As of 31 March 2019, Anadarko held a 26.50 per cent. participating interest, and is the operator

for the area, while BREML, ONGC Videsh, Mitsui E&P Mozambique Area 1 Limited, BPRL Ventures

Mozambique B.V., PTTEP Mozambique Area 1 Limited and ENH Rovuma Area Um, S.A held a 10.00 per cent.

participating interest, 10.00 per cent. participating interest, 20.00 per cent. participating interest, 10.00 per cent.

participating interest, 8.50 per cent. participating interest and 15.00 per cent. participating interest, respectively.

The second and final exploration phase was completed on 31 January 2015. After a successful

exploration, Area-1 has retained five of the discovered areas in Prosperidade, Golfinho-Atum, Orca, Tubarao

and Tubarao-Tigre. The majority of the gas resources are located in two fields, Prosperidade and Golfinho-

Atum. ONGC Videsh estimates that its portion of share of the 2P reserve in the Area-1 offshore block amounts

to 214.785 MMtoe of Gas.

The Area-1 consortium is currently progressing with initial development of Golfinho-Atum field through

two LNG trains of 6.44 MMTPA capacity each under the integrated structure, with flexibility to expand up to

50 MTPA in future years. The Golfinho-Atum Development Plan was approved by the Government of

Mozambique on February 6, 2018. On June 18, 2019, the Area-1 consortium, announced a Final Investment

Decision (the “FID”) on the initial development project. The consortium has achieved a number of major

milestones over the past year positioning the initial two-train Golfinho/Atum project to be Mozambique’s first

onshore LNG project. This includes the execution of eight long-term LNG offtake agreements with major Asian

and European customers totalling more than 11.1 million tonnes per annum.

Approximately 6,500 hectares of land on the Afungi Peninsula, under the name of “Afungi Project Site”,

have been allocated for an LNG park, where the Project is located. The construction of the replacement village

and local infrastructure such as the airstrip, roads and camps are currently underway. The Resettlement project

was joined in 2018 by Area-4 as a 50.00 per cent. participant. The engineering, construction, procurement and

installation contracts needed for the FID have been approved and executed. The LNG production is expected

to commence by 2024.

A39729228 202

The Area-1 consortium formally launched project financing in early December 2018 and has received

sufficient lender support and the necessary government-related financing approvals to proceed with the FID

enabling access to significant debt to fund approximately two-thirds of expected project costs.

Venezuela — Carabobo project

The Carabobo project, located in the Orinoco heavy oil belt in eastern Venezuela, covers an area of

approximately 383 sq. km and consists of the Carabobo-1 North block and the Carabobo-1 Central block. The

Carabobo project (covering both Carabobo-1 North and Carabobo-1 Central blocks) involves the construction

of Production Facilities and infrastructure to produce extra-heavy crude oil of 8 to 9 degrees API gravity as well

as upgrader facilities to produce high-quality crude (approximately 32 degrees API) with no bottom products.

As of 31 March 2019, ONGC Videsh through its subsidiary, Carabobo One AB held a 11.00 per cent.

participating interest in the project, while Indoil Netherlands B.V., Repsol YPF and Corporación Venezolana

del Petróleo, a subsidiary of Venezuela’s state oil company held a 7.00 per cent. participating interest, 11.00 per

cent. participating interest and 71.00 per cent. participating interest, respectively. The project is currently at

early stages of production, engaged in the preparatory stages of constructing heavy oil production facilities and

associated infrastructure. A service company has been incorporated to manage, coordinate and supervise the

construction of these facilities. Through an early accelerated production system, the project first produced oil

on 27 December 2012, and the average production from the field is approximately 18,000 bbl/d for the 2019

Fiscal Year.

Syria — Block XXIV

The contract for exploration, development and production of petroleum for Block XXIV was signed on

15 January 2004 with an effective date commencing from 29 May 2004. The exploration phase for the block

expired on 28 September 2011 and the consortium drilled a total of 14 wells in the block in this phase.

Based on the exploration results, the Government of Syria granted development rights for additional

areas of three formations in Abu Khashab area. Plans of development for the areas has been prepared by the

IPR Mediterranean Exploration Ltd. as the operator. Furthermore, the Syrian authorities are also considering

the consortium’s request for the development right for the Romman area. However, the project is now under a

shutdown due to the political and security conditions in Syria and will only resume once conditions in the area

have improved and the sanctions imposed on Syria have been lifted.

As of 31 March 2019, ONGC Videsh held a 60.00 per cent. participating interest in Block XXIV, while

IPR Mediterranean Exploration Ltd. (also the operator for the block) and Tri Ocean Mediterranean held a 25.00

per cent. participating interest and 15.00 per cent. participating interest, respectively.

Iran — Farsi offshore exploration block

Farsi is an exploration block located in the Persian Gulf offshore of Iran and covers an area of

approximately 3,500 sq. km. ONGC Videsh, carried out exploration under an exploration service contract as an

operator for an Indian consortium.

In 2002, ONGC Videsh together with IOCL and OIL, entered into an exploration service contract with

National Iranian Oil Company (“NIOC”) for the Farsi offshore block, under which exploration work was

carried out in the Farsi block in Iran during the period from 2003 to April 2007, leading to commercial discovery

of the FB Area in the Farsi block (later rechristened as Farzad-B Gas Field). A master development plan of

Farzad B gas field was submitted in 2011. However, no field activity has been carried out since April 2007 and

the exploration period under the contract expired in June 2009.

A39729228 203

In November 2012, the Company communicated these matters to the U.S. Government Accountability

Office. The Company was listed on the U.S. Government Accountability Office’s list of companies reported to

have commercial activities in Iran’s energy sector published in January 2015.

In January 2016, sanctions were lifted on Iran’s energy sector under the JCPOA, reached by Iran, the

so-called P5+1 (China France, Germany, Russia, the United Kingdom, and the United States), and the European

Union. The United States subsequently announced on 8 May 2018 that it would withdraw from the JCPOA,

and reimposed U.S. sanctions targeting Iran’s energy sector, amongst others. While Iranian authorities,

following the implementation of the JCPOA, expressed their interest for continuing the development of

activities in Farzad-B gas field by the Indian consortium led by ONGC Videsh, ONGC Videsh has not entered

into any binding term-sheets, memoranda of understanding or definitive agreements in respect of development

activities in Farzad B gas field and any such development activities will require the Indian Government’s

approval. ONGC Videsh does not currently have any field activity in any block or field or project in Iran.

As of 31 March 2019, ONGC Videsh held a 40.00 per cent. participating interest in the consortium,

while IOCL and OIL held a 40.00 per cent. participating interest and 20.00 per cent. participating interest,

respectively.

Libya — Contract Area 43

ONGC Videsh acquired Contract Area 43 located in Cyrenaica offshore basin of Libya in the

Mediterranean Sea under an exploration and production sharing agreement effective from 17 April 2007.

Contract Area 43 consists of four blocks spread over an area of 7,449 sq. km. The block boundaries extend from

the coastline to a water depth of about 2,200 metres. In 2013, the acquisition, processing and interpretation of

1,011 line km 2D Seismic Data and 4,000 sq. km 3D Seismic Data has been completed. Due to civil unrest in

Libya, Contract Area 43 was put under force majeure from 26 February 2011 to 31 May 2012 and the

exploration phase of Contract Area 43 was extended up to 21 July 2013.

In view of security situations, ONGC Videsh requested to the National Oil Corporation of Libya for

extension of exploration period by 2.5 years (until 21 January 2016) for carrying out further exploration

activities, however extension was granted for one year up to 21 July 2014. As of the date of this Offering

Circular, ONGC Videsh remains in discussions with the National Oil Corporation of Libya for extension of

exploration period post-21 July 2014.

As of 31 March 2019, ONGC Videsh held a 100.00 per cent. participating interest in Contract Area 43

with operatorship.

Colombia — RC-9, RC-10; Block SSJN-7; CPO-5; Gua off-2; LLA-69

Blocks RC-9 and RC-10 and Gua off-2 located in water depths of 70 to 2,700 metres offshore of

Colombia, cover an area of approximately 1,060 sq. km, 1,340 sq. km, and 1171 sq. km respectively. As of 31

March 2019, ONGC Videsh and Ecopetrol each held a 50.00 per cent. participating interest in each of Blocks

RC-9 and RC-10. Block RC-9 is operated by Ecopetrol, and ONGC Videsh operates Block RC-10. As of 31

March 2019, ONGC Videsh held a 100.00 per cent. participating interest in, as well as the being the operator

for, offshore block Gua off-2.

Block RC-9

Exploratory Well Molusco-1 was drilled in Block RC-9, and based on the drilling result, the well was

plugged and abandoned. The operator informed the regulator about the non-discovery in the block. As of the

date of this Offering Circular, relinquishment is in process.

A39729228 204

Block RC-10

Recent studies carried out by the Geodata Processing and Interpretation Center of ONGC Videsh, ONGC

Videsh Atlantic Inc. (“OVAI”) and Ecopetrol suggests adverse prospects of the block. Accordingly, procedure

for relinquishment of the block has been initiated and its minimum financial commitment has been transferred

to block CPO-5 against additional activities. As of the date of this Offering Circular, ONGC Videsh has six

pending legal compensation cases with indigenous fisherman in the area, whom have claimed against ONGC

Videsh for the loss of their fishing artifacts due to seismic activities.

Block SSJN-7

The SSJN-7 block has an area of 2,707 sq. km located in the south western part of onshore Sinu San

Jacinto basin of Colombia and was awarded to a consortium made up of ONGC Videsh and Pacific Rubiales

Energy (“PRE”) on 24 December 2008 during the bidding rounds. Subsequently in 2017, PRE transferred its

participating interest in the block to CanaCol Energy. As of 31 March 2019, ONGC Videsh and Canacol Energy

each held a 50.00 per cent. participating interest in the block. As of the date of this Offering Circular, ONGC

Videsh had acquired 332 line km of 2D seismic survey in the Eastern part of the block and further acquisition

of 157 sq. km of 3D Seismic Data and drilling of one well is to be carried out to fulfil the minimum work

programme of exploration period.

Block CPO-5

Block CPO-5 covers an area of approximately 1,992 sq. km. As of 31 March 2019, ONGC Videsh, held

a 70.00 per cent. participating interest in the block while Petrodorado South America S.A. held the remaining

30.0 per cent. participating interest. ONGC Videsh is the operator of Block CPO-5. As of the date of this

Offering Circular, ONGC Videsh has made four discoveries in the block, which includes Kamal-1, Loto-1,

Mariposa-1 and Indico-1.

Gua off-2

As Gua off-2’s prospects were dependent on the prospects of RC-10 block, ONGC Videsh had initiated

the procedure for relinquishment of the block in November 2016 and transferred its minimum financial

commitment towards additional drilling activities in the CPO-5 block. As of the date of this Offering

Circular, relinquishment is in process.

Block LLA-69

Block LLA-69 covers an area of approximately 226.5 sq. km. Block LLA-69 was awarded to MECL

following its successful bid in 2012. MECL is a joint venture company between ONGC Videsh and Sinopec

International Petroleum Exploration and Production Corporation, a subsidiary of Sinopec. ONGC Videsh

acquired 50.00 per cent. share in MECL in August 2006. As of 31 March 2019, ONGC Videsh held a 50.00 per

cent. equity interest in MECL. As of 31 March 2019, MECL held a 100.00 per cent. participating interest in the

block onshore, with MECL also operating the project. For completion of the minimum work programme of the

ongoing first phase of the exploration period, 3D seismic survey of 75 sq. km has been acquired processed and

interpreted. Since 4 June 2017, Block LLA-69 is under suspension due to a force majeure event (i.e.

consequence of a referendum where the community of Cumaral Municipality voted in majority against the

hydrocarbon industry in the region) for an indefinite period of time. In light of this, a negotiation with the

Agencia Nacional de Hidrocarburos of Colombia was undertaken to transfer the minimum financial

commitment to a better acreage. The Agencia Nacional de Hidrocarburos of Colombia has offered new

exploration blocks for the transfer from Block LLA-69. The blocks are currently under techno-commercial

evaluation by MECL.

A39729228 205

Brazil — Blocks BM-SEAL-4

As of 31 March 2019, ONGC Videsh, through its subsidiary ONGC Nile Ganga B.V., held a 25.00 per

cent. participating interest in Blocks BM-SEAL-4, while Petrobras (also the operator and consortium guarantor

for the block) held the remaining 75.00 per cent. participating interest. At the end of phase 2 exploration,

Petrobras decided to participate in the Moita-Bonita PAD (i.e. a discovery appraisal plan), which covers an area

of about 1,020 sq. km spread over in part of BM SEAL four block (320 sq. km) and BM SEAL 10 block (700

sq. km), to assess the oil and a gas potential of the block. The committed work programme in Moita-Bonita

PAD is 3D seismic of 1,020 sq. km, drilling of three firm wells and two contingent wells. A 3D Seismic Data

of 1,020 sq. km and drilling of four wells (three firm and one contingent) was completed in the PAD. The

Brazilian National Agency of Petroleum, Natural Gas and Biofuels has granted extension for submission of the

declaration of commerciality of Moita-Bonita PAD to 1 December 2020.

Two contingent well locations have been firmed up for drilling in the block. The first well MB-2 was

successfully completed in June 2019, the second well MB-9 (Earlier name was PV-7) is under drilling.

Israel — Block 32

The Block 32 has an area of 357 sq. km and is located offshore of Israel with a water depth ranging

between 1,500 to 1,800 metres. The block was awarded to ONGC Videsh in consortium with BPRL, IOCL and

OIL in the first Israeli offshore bid round in 2016. The petroleum license for the block was signed on 27 March

2018 between the State of Israel and the consortium. As of 31 March 2019, ONGC Videsh (also the operator of

the block) held a 25.00 per cent. participating interest in the block, while BPRL, IOC and OIL each held a 25.00

per cent. participating interest. The minimum work programme for the Phase I exploration comprised of

reprocessing and interpretation of available Seismic Data.

The pre-processing studies have been completed by OVAI and the re-processing is on-going by Paradigm

Geophysical Limited, which will be followed by re-interpretation for further evaluation and identification of

prospects.

Namibia — PEL 0037

Block PEL-0037 has an area of 17,295 sq. km and is located in the offshore Walvis basin of offshore

Namibia. ONGC Videsh acquired Block PEL-0037 in offshore Namibia, through its wholly-owned subsidiary

ONGC Videsh Vankorneft Pte. Ltd. (“OVVL”), under a petroleum agreement with effect from 1 January 2017

and ending on 27 March 2020. As of 31 March 2019, OVVL held a 30.00 per cent. participating interest in the

block, while the other partners namely Tullow Namibia Limited (also the operator of the block), Pancontinental

Oil and Gas Namibia Limited and Paragon Investment Holdings (Pty) Limited held a 35.00 per cent.

participating interest, 30.00 per cent. participating interest and 5.00 per cent. participating interest respectively.

OVVL acquired the block during Exploration Phase I and subsequently applied for extension of

Exploration Phase II up to 27 March 2020 which was granted by the Ministry of Mines and Energy of Namibia.

The minimum work programme for Exploration Phase II comprised of drilling of one Exploratory Well to 3,830

metres which was drilled up to 3,855 metres in September 2018. No presence of hydrocarbon was detected in

the said well. OVVL is currently under process for relinquishment of the participating interest in the licence.

Vietnam — Block 128

Block 128, a deep-water block located 200 metres offshore of Vietnam, covers an area of approximately

7,058 sq. km. A production sharing agreement was signed with Petro Vietnam in May 2006. The Ministry of

Petroleum and Industries of Vietnam issued an investment license on 16 June 2006, which is also the effective

date of the production sharing agreement. As of 31 March 2019, ONGC Videsh held a 100.00 per cent.

participating interest and is the operator of the block.

A39729228 206

During the exploration period, acquisition of 3D Seismic Data and reprocessing of 2D Seismic Data and

geological and geophysical studies were carried out fulfilling part of the minimum work programme of the first

phase of the exploration period. One commitment Exploratory Well was identified to be drilled as a part of the

minimum work programme of first phase of exploration period. However, the drilling rig could not be anchored

at the location due to hard carbonate sea bottom and strong currents and the drilling was suspended. The

Company has applied for extension of Phase I for two more years (from 16 June 2019 to 15 June 2021).

Iraq — Block 8

Block-8, a large onshore exploration block located in the western desert in Iraq, covers an area of

approximately 10,600 sq. km. As of 31 March 2019, ONGC Videsh held a 100.00 per cent. participating interest

in the block. The exploration and development contract for the block was signed on 28 November 2000. The

contract was ratified by the Government of Iraq on 22 April 2001 and was effective from 15 May 2001. Since

then, the work relating to archival, reprocessing and interpretation of the existing Seismic Data has been

completed. However, ONGC Videsh had to notify the force majeure situation to the Ministry of Oil, Iraq in

April 2003 due to the then existing conditions in Iraq. In 2008, ONGC Videsh was informed that the

Government of Iraq had decided to renegotiate the Block-8 contract in line with the provisions of the new oil

and gas law which was expected to be promulgated soon. In 2018, the Government of Iraq has adopted a new

business model, which is under review, however, the renegotiation has yet to commence.

Kazakhstan — Satpayev Block

As of 31 March 2019, ONGC Videsh held a 25.00 per cent. participating interest in the Satpayev block

located in the Caspian Sea, Kazakhstan, for exploration of crude oil and natural gas. KazMunayGas, the state-

owned oil and gas company of Kazakhstan, owns the remaining 75.00 per cent. equity interest and Satpayev

Operating LLP, a wholly-owned subsidiary of KazMunayGas, is the operator for the Satpayev block.

The geological and geophysical commitments in the block have been fulfilled and two exploration

commitment wells were drilled in 2015 and 2017 without any commercial discovery. ONGC Videsh decided to

exit from the project in April 2018 and the project is now under relinquishment, awaiting approval from the

Government of Kazakhstan.

Bangladesh — Blocks SS-04 and SS-09

On 2 April 2013, ONGC Videsh, in consortium with OIL, submitted a bid for two shallow water blocks

in Bangladesh (SS-04 and SS-09). Both blocks were awarded to the consortium. A PSC was signed on 17

February 2014 for the two blocks between the Government of the People’s Republic of Bangladesh, Bangladesh

Oil and Gas and Mineral Corporation, the consortium of ONGC Videsh and OIL and the Bangladesh Petroleum

Exploration and Production Company Limited (“BAPEX”). As of 31 March 2019, ONGC Videsh (also the

operator of the block) held a 45.00 per cent. participating interest in the block, while OIL and BAPEX held a

45.00 per cent. participating interest and 10.00 per cent. participating interest, respectively.

One Exploratory Well location in SS-04 block has been released in onshore area and the expected date

for spudding is in the first week of August 2019. Additionally, two offshore locations (each in SS-04 and SS-

09) have also been identified for drilling.

Myanmar — Blocks PSC B-2 (Zebyutaung-Nandaw) and EP-3 (Thegon-Shwegu)

The Ministry of Energy, Republic of the Union of Myanmar awarded two onshore exploration blocks

PSC B-2 (Zebyutaung-Nandaw) and EP-3 (Thegon-Shwegu)), to a consortium led by ONGC Videsh in the

Myanmar Onshore bidding round in 2013. Block PSC B-2 (with an area of approximately 17,000 sq. km) is

located in Northern Myanmar, bordering the state of Manipur in India and Block EP-3 (with an area of

approximately 1,650 sq. km) is located in Central Myanmar. A production sharing agreement was signed on 8

August 2014 with MOGE, with ONGC Videsh acting as the operator of the blocks. As of 31 March 2019,

A39729228 207

ONGC Videsh continued to hold a 97.00 per cent. participating interest in the blocks while Machinery and

Solutions Company Limited held the remaining 3.00 per cent. participating interest. ONGC Videsh has licence

for the blocks until 31 December 2020.

Four committed Exploratory Wells (two in each block) will be drilled for fulfilling the minimum work

programme for the first phase of on going exploration period, which commenced on 1 January 2016. The

commitment for seismic API for Block EP-3 has been fulfilled and two locations have been identified for

drilling. Pre-drilling activities are in progress. As of the date of this Offering Circular, work commitment for

seismic acquisition in block PSC B-2 is complete and the data is under processing.

New Zealand — Block PEP 57090 (Taranaki)

The block was awarded to ONGC Videsh in the New Zealand bidding round on 9 December 2014 for a

term of 12 years commencing from 1 April 2015. As of 31 March 2019, ONGC Videsh held a 100.00 per cent.

participating interest in the block. OINGC Videsh is also the operator of the block. Block PEP-57090 has an

area of 2,121 sq. km and is located in the offshore Taranaki basin with water depth ranging between 300 to 400

metres. The minimum work programme for Phase I exploration comprised of acquiring, processing and

interpreting (including structural mapping and seismic attribute study 1,400 sq. km of full fold 3D Seismic

Data.

A multi-client 3D broadband seismic was completed on 4 February 2017 and the total data acquired and

processed was 1,861 sq. km. The geological and geophysical interpretation of the acquired data was completed

by OVAI and also by third party independent consultants, Houston and Beicep-Franlab. The well location has

yet to be identified for drilling.

Non-Conventional Energy Production, Exploration and Development

The Company continues to focus on non-conventional energy sources, including coalbed methane,

underground coal gasification, shale gas and gas hydrate, as well as renewable energy sources such as wind and

solar power. Following the HPCL Acquisition, the Company’s renewable energy production capacity was

further enhanced.

The Company commenced non-commercial coalbed methane production from its Jharia coalbed

methane block in Jharkhand in January 2010 and discovered shale gas in the Damodar Valley Raniganj block

in West Bengal in January 2011.

The Company has taken up research and development in clean and alternative sources of energy through

its ONGC Energy Centre which is engaged in in-house research, through its own scientists/research teams as

well as collaborative projects jointly taken up with some of the leading national academic and research

institutions. The current broad areas of research include (i) Sub-surface Uranium exploration and recovery by

in-situ leaching process; (ii) Hydrogen energy, (iii) Biotechnology process for generation of methane or bio-

fuels, (iv) Solar energy; (v) Geothermal energy and (vi) Kinetic hydro energy.

The Company has a rich repository of drilled well information in the petroliferous basins of India, which

includes presence and concentration of Uranium mineralisation at some places. The Company supports to

exploit the rich database for locating deposits of uranium mineralisation and to develop an In-Situ-Leaching

Technology for exploitation of such Uranium resources/ores. A Memorandum of Understanding with Atomic

Minerals Directorate for Exploration and Research, Hyderabad has been signed by ONGC Energy Centre for

promoting research in this area.

The Company began its shale gas/oil exploration programme in 2010 with a pilot shale gas drilling

programme in Damodar Valley under a special dispensation from the Indian Government. Two wells each were

drilled in Raniganj and North Karanpura CBM blocks held by the Company. Out of the four wells drilled, one

well in Raniganj, after hydro-fracturing in Barren Measures Formation of Permian flowed the first-ever shale

A39729228 208

gas in India. Shale Gas Policy guidelines for exploration and exploitation of shale gas were announced by the

Indian Government on 14 October 2013 wherein national oil companies were entrusted with the responsibility

of promoting shale gas and oil operations in existing on-land PEL/PML areas under nomination acreages with

national oil companies.

Further, the Company’s shale gas efforts include joint study with ConocoPhillips in the Cambay,

Krishna-Godavari, Cauvery and Damodar basins in India in 2012 to 2013, as well as pursuing shale gas efforts

outside India through ONGC Videsh. The Company sponsors shale gas research at the Indian Institute of

Technology Kharagpur and Indian Institute of Technology Bombay. The Company initiated the shale gas and

oil exploration activities in four basins namely, Cambay, Krishna-Godavari, Cauvery and Assam and Assam

Arakan as per the new policy guidelines announced by the Indian Government in October 2013. The Company

has prioritised the Cambay basin for initiating a Shale Gas exploration pilot programme and spudded the first

well at Jambusar, Ankleshwar, Gujarat in Cambay basin. The Company has identified 50 blocks for exploration

in Phase-I; 28 in Cambay basin, 10 in Krishna-Godavari basin, nine in Cauvery basin and 3 in Assam-Arakan

basin. So far, 26 wells (eight exclusive Shale Gas wells and 18 dual objective wells) have been drilled in

Cambay, Assam and Assam Arakan, Cauvery and Krishna-Godavari basins. A total of three exclusive shale

gas/oil wells were completed in the year 2019, the first one being WGSGA (West Godavari block) in Krishna-

Godavari basin and the other two being NDSGA (in Nada area of Ankleswar block) and NGSGA (in Nawagam

area of Ahmedabad block) in Cambay basin. These wells were extensively cored for evaluation. On hydro-

fracturing and on subsequent activation in the WGSGA well, the well gave indication of oil and thus established

presence of shale oil petroleum system in Gudivada Graben of Krishna-Godavari basin. Besides one dual

objective well NGSAA (Nandigama South) located within Bantumili graben of Krishna-Godavari basin was

also drilled this year and cored within Raghavapuram Shale for further study.

The Company is operating in the states of West Bengal and Jharkhand in Eastern India for CBM

development activities. Raniganj, Jharia, Bokaro and North Karanpura are the blocks where the Company has

established an in-place volume of 83.19 BCM. Sale of incidentally produced CBM gas was initiated in the

Parbatpur Sector of the Jharia CBM block and has been continuing since January 2010. As of the date of this

Offering Circular, development activities have been taken up in full swing in Bokaro and Karanpura.

The Company’s underground coal gasification efforts include undertaking a pilot project in the Vastan

Mine block in the Surat district of Gujarat. The Company has obtained environmental clearance for the project

and as of the date of this Offering Circular, is awaiting the award of a mining lease from the Ministry of Coal.

The Company is actively pursuing research on gas hydrates under the National Gas Hydrate Programme

of India and has successfully discovered two gas hydrate reservoirs in Krishna-Godavari deep water in the

eastern offshore. Further research on gas hydrates is in progress for the economic exploitation of gas from

hydrate bearing reservoirs in Indian offshore. Pilot production testing is planned in Krishna-Godavari deep

offshore under NGHP Expedition 03 during 2017 to 2018.

The Company commissioned a 51 MW on-land wind farm in 2008 at Kutch, Gujarat and a 102 MW on-

land wind farm in 2015 at Jaisalmer, Rajasthan. Through HPCL, the Company also operates land wind farms

with a total capacity of 100.90 MW in the states of Rajasthan (including the 50.40 MW land wind farm

commissioned in December 2016) and Maharashtra.

The Company is also in the process of uranium extraction and is exploring the feasibility of establishing

a nuclear power project, regarding which it has had preliminary discussions with the Nuclear Power Corporation

of India Limited.

Through HPCL, the Company also operates a grid connected solar plant in Chennai which was

commissioned in March 2016 and has approximately 22.60 MWP of installed captive solar power capacity as

of 31 March 2019.

A39729228 209

Oil Field Services

The Company provides a range of in-house oil field services to support its exploration, development and

production activities. The Company’s in-house oil field services include geophysical data acquisition and

analysis, drilling, mud engineering, cementing, electro-logging, well stimulation, work-over services, well

testing, a variety of general engineering services, and inspection, maintenance and repair, services.

Geophysical Services

For the 2019 Fiscal Year, the Company had deployed 18 Seismic Data acquisition crews (13 of which it

owns and five of which are hired) for onshore and offshore Seismic Data acquisition. The Company processes

and interprets its Seismic Data in-house through various centres located in India.

Drilling Services

The Company provides a comprehensive range of drilling, mud engineering, well design and well

cementing support. The Company currently owns and operates 58 onshore drilling rigs of different capacities,

as well as eight offshore drilling rigs. In addition, the Company currently operates 12 leased onshore rigs and

23 leased offshore rigs. The Company has experience in advanced drilling technology such as extended reach

drilling, under balance drilling, Ultra deep-water drilling, turbo drilling, air hammer drilling and drilling of high

pressure high temperature wells. The Company has gained experience by working over three decades in the

west coast and east of India offshore and by drilling wells over five decades in onshore areas in challenging

reservoirs. The Company’s mud engineering and well cementing support requirements are met through its in-

house and external contract resources. The Company also maintains teams of crisis management personnel

trained to respond to emergencies, such as uncontrolled flow from wells.

Well Services

The Company provides in-house work-over, stimulation and well testing support for its production

operations. The Company currently owns and operates 46 onshore work-over rigs, 116 well stimulation units

and one offshore simulation vessel. In addition, the Company operated 23 leased work-over rigs onshore, and

two offshore workover rigs. The Company’s in-house service teams meet substantially all of the Company’s

internal requirements for the design, installation, operation and maintenance of artifices lift systems, well

completion, well testing and wire line operations.

Electro-Logging Services

The Company provides electro-logging services through 28 in-house units, of which 24 are in onshore

areas and four are in offshore areas. The Company also has 65 contractual logging units including modular

offshore and PLT offshore of which 12 are meant for onshore areas and 53 in offshore areas and four including

High Pressure High Temperature (“HPHT”) and Hi-Tech for onshore/offshore. Additionally, the Company has

20 contractual Logging While Drilling units, of which six are deployed in onshore areas and 10 in offshore

areas and four including HPHT and Hi-Tech for onshore/offshore. The Company has 64 mud logging units 24

units in offshore (including three advanced MLUs) and 40 units in onshore. The Company also has 20 Tubing

Conveyed Perforating and Drill Stem Testing container for offshore/onshore including two HPHT and four ultra

HPHT containers. The company also has two compact well shuttle units for onshore and offshore and one e-

line well intervention unit in offshore.

Engineering Services

The Company’s in-house engineering services personnel provide specialised services for detailed

engineering and management of all work relating to the design and construction of onshore and offshore

production facilities, the laying and maintenance of onshore and offshore pipelines and the maintenance of

equipment.

A39729228 210

Technical Services

The Company’s in-house technical services personnel provide policy guidelines on equipment management,

standardisation, technical audits, identification, acquisition, assimilation and dissemination of new techniques

and technology relating to oil field equipment and services. The Company operates workshops that provide

support for major repairs and maintenance of various types of equipment.

Inspection, Maintenance and Repair; Offshore Logistics

The Company’s requirements for underwater inspection, maintenance and repair of its offshore

platforms, jackets, risers, sub-sea pipelines and other marine equipment are met primarily through the use of

in-house services. The Company owns and utilises one multi-purpose support vessel and one diving support

vessel to perform these services, as well as to provide fire fighting, pollution control, rescue support and diving

assistance for offshore operations. As of the date of this Offering Circular, the Company also owned and

operated nine supply vessels that provide logistical and standby support to its offshore production operations.

To complement its in-house oil field services, the Company engages third party contractors to provide

additional services on an as-needed basis to support its exploration, development and production activities.

Improved Oil Recovery (“IOR”) and Enhanced Oil Recovery (“EOR”) Techniques

The Company undertakes a wide range of secondary recovery, artificial lift, IOR and EOR techniques

to achieve maximum recovery, increasing the Company’s oil reserves, primarily from its mature fields. As part

of its reservoir management strategy, the Company implements these techniques at a relatively early stage in

the life of the Company’s oil fields to maximise its recoveries. The Company has adopted 29 IOR/EOR and

redevelopment schemes in the onshore and offshore fields of these 29 schemes, 25 schemes have been

completed and the remaining four are under implementation.

The following table sets forth certain information relating to the four IOR/EOR projects currently under

implementation:

IOR/EOR Schemes

Estimated

Project Cost

Expenditure as

of 31 March

2019

Balance

Planned

Expenditure

(Rs. million)

Mumbai High South Redevelopment (Phase-III) ............. 60,688 47,249 13,440

Mumbai High South Redevelopment (Phase-IV) ............. 36,607 1,260 35,347

Neelam Redevelopment Plan ........................................... 28,189 20,666 7,523

Redevelopment of Santhal field ....................................... 11,626 3,372 8,254

Total ................................................................................. 137,110 72,547 64,564

The Company intends to expand its use of various enhanced oil recovery techniques to extend crude oil

production peak periods, reduce water production, mitigate future decline rates and potentially accelerate crude

oil production. As of 31 March 2019, the Company’s total expenditure with respect to these onshore and

offshore schemes was Rs. 513,557 million.

Onshore

The Company has implemented and completed all of its planned IOR/EOR and redevelopment schemes

in the onshore fields, which includes Kalol, Gandhar, North Kadi, Sobhasan, Joana, Santhal fields, Lakwa,

Geleki and Rudrasagar fields in the Assam and Assam-Arakan basin.

A39729228 211

Offshore

The Company has implemented and completed IOR/EOR and redevelopment schemes in the offshore

fields including the Heera Part-I and Part-II, Neelam, Mumbai High North and Mumbai High North and

Mumbai High South fields in the Mumbai offshore basin. As of 31 March 2019, IOR/EOR are being

implemented for the Neelam redevelopment Plan, the Mumbai South Redevelopment (Phase-III) and the

Mumbai High North and Mumbai High South Redevelopment (Phase-IV).

Descriptions of various EOR techniques are set out below:

In situ combustion. This technique is being employed to recover oil from the heavy oil belt of the

Mehsana asset, which in normal reservoir conditions is very viscous and less mobile. The in situ method

imparts heat energy to the reservoir to raise the temperature and thereby reduce the viscosity to improve

mobility. This technique is being employed on a commercial scale in Balol and Santhal fields and pilot

schemes are being implemented in Bechraji and Lanwa fields.

Microbial enhanced oil recovery. This process involves injection of selected microorganisms (bacterial

consortium) along with nutrients in the reservoir. A certain incubation period is spent in the reservoir.

During this period the injected microorganisms grow, proliferate and produce useful metabolites such as

bio-surfactant, gases, solvent and acids. The bacterial consortium is non-pathogenic and non-toxic.

Microbial enhanced oil recovery field trials are underway in the Ahmedabad asset, Mehsana asset and

Ankleshwar asset in the Cambay basin.

Miscible gas injection. This is an EOR technique applied in oil reservoirs to maintain reservoir pressure

and improve recovery factor. Miscible gas injection is being carried out in the Cambay basin.

Water alternate gas. This EOR technique has been tried as a pilot project in the GS-11 sand of Gandhar

field at Ankleshwar asset and is showing positive results. Because of the latest Paris Convention on

Climate Change, CO2 EOR as sequestration project in the form of carbon, capture, utilisation and storage

has been planned in GS-9 and GS 11 sand of Gandhar field.

Polymer flood and Alkaline surfactant polymer (“ASP”). Polymer flood has been implemented in

Sanand field since 1985 and has been producing good results for last 34 years. ASP has already been

implemented in Viraj and K-IV sand of Jhalora fields. The scheme is also planned for the K-XII sand of

Kalol field in the Ahmedabad asset. Multiple EOR schemes pertaining to chemical EOR are planned in

the Company’ onshore reservoir.

Cyclic Steam Stimulation. This process will be implemented for the first time in the heavy oil field of

Lanwa.

Sales and Marketing of Crude Oil and Natural Gas

Although price controls and other aspects of domestic sales and marketing have been deregulated, supply

and distribution arrangements continue to be characterised by a substantial degree of coordination among

industry participants. The Company intends to improve its sales and marketing efforts by obtaining access to

leased storage and handling facilities at selected locations, registering with sales tax authorities in various states

in India to permit direct sales in those locations and obtaining an exemption under naphtha and solvent control

regulations.

For the 2017 Fiscal Year, the 2018 Fiscal Year and the 2019 Fiscal Year, the Company’s non-consolidated

revenues from sales of crude oil were Rs. 548,035.52 million, Rs. 603,899.28 million and Rs. 775,728.93

million, respectively, and the Company’s non-consolidated revenues from sales of natural gas were Rs.

139,397.71 million, Rs. 137,371.73 million and Rs. 188,388.66 million, respectively.

A39729228 212

The following table sets forth certain information relating to the Company’s domestic sales of crude oil

for the periods indicated:

Fiscal Year

Crude Oil 2017 2018 2019

Volume sold excluding joint ventures ...... MMT (MMbbls) 19.83 (148.73) 19.75 (148.13) 18.52 (138.90)

Volume sold at joint ventures .................. MMT (MMbbls) 4.03 (30.23) 3.92 (29.40) 3.98 (29.85)

Total ........................................................ 23.86 (178.96) 23.67 (177.53) 22.50 (168.75)

Benchmark (1) ........................................... (U.S.$/barrel) 50.03 57.97 71.60

Average Rs. to U.S.$ exchange rate (2) ..... Rs./U.S.$ 67.09 64.45 69.89

Benchmark ............................................... (Rs./barrel) 3,357 3,736 5,004

Average Realised Price ............................ (Rs./barrel) 3,372 3,695 4,766

Average Realised Price ............................ (U.S.$/barrel) 50.27 57.33 68.19(3)

Notes:

(1) Benchmark is calculated as the average price per barrel of Bonny Light crude to which sales of the Company’s domestic crude oil,

from the Company’s nomination blocks (other than North East crude), as well as some of the crude from joint ventures, are

benchmarked.

(2) Source: RBI.

(3) Effective from 1 April 2018, crude price is calculated and reported net of VAT/CST of approximately 3.90 per cent.

The following tables set forth certain information with respect to the Company’s international sales of

crude oil for the periods indicated.

Fiscal Year

Crude Oil 2017 2018 2019

International

Volume sold ................................................ MMT 4.31 8.53 9.33

Volume sold ................................................ MMbbl 30.68 62.26 68.25

Average Benchmark Price (assumed as

Brent (dated)) .............................................. U.S.$bbl

48.61 57.49 70.38

Average Rs. to U.S.$ exchange rate. ........... Rs./U.S.$ 67.07 64.47 69.95

Average Realised Price ............................... U.S.$/bbl 45.67 54.37 69.72

The following table sets forth certain information with respect to the Company’s domestic sales of

natural gas for the periods indicated:

A39729228 213

Fiscal

Natural Gas 2017 2018 2019

Owned and Operated Fields

Volume sold ................................................ MMSCM 17,021 18,553 19,597

Average Realised Price (gross of royalty) ... U.S.$/MSCM 113 106 129

Rs./MSCM 7,599 6,821 8,954

U.S.$/MMbtu 2.85 2.66 3.24

Joint Ventures

Volume sold ................................................ MMSCM 874 939 886

Average Realised Price (gross of royalty) ... U.S.$/MSCM 218 214 238

Rs./MSCM 14,632 13,838 16,518

U.S.$/MMbtu 5.49 5.40 5.99

Average Rs. to U.S.$ exchange rate ............ Rs./U.S.$ 67.19 64.53 69.54

Notes:

(1) Price in Rs./MSCM is derived considering conversion factor 1MMbtu = 39.68254 SCM)

(2) Figures are derived from Rs./MSCM which is weighted average price derived for the year.

(3) For determination of gas price in INR, FE rate (i.e. RBI Reference rate) is considered for the previous month.

The following table sets forth certain information with respect to the Company’s international sales of

natural gas for the periods indicated:

Fiscal

Natural Gas 2017 2018 2019

International ................................................

Volume sold ................................................ MCM 1,890 3,740 3,590

Weighted Average Realised Price ............... U.S.$/MMbtu 3.81 4.02 4.02

Rs./MMbtu 255.55 259.17 279.98

Average Rs. to U.S.$ exchange rate . .......... Rs./U.S.$ 67.07 64.47 69.95

Domestic Sales and Marketing of Crude Oil and Natural Gas

The Indian Government, acting through the MoPNG, allocates the Company’s current domestic crude

oil production from pre-NELP and nomination blocks to three Indian Government-controlled refinery

companies: IOCL and BPCL and their respective subsidiaries, as well as MRPL’s and HPCL’s respective

refineries which also consumes a portion of the Company’s domestic crude oil. While the MoPNG continues

to allocate domestic crude oil to these public sector undertaking refiners on an annual basis, supplies are made

in terms of the Crude Oil Sales Agreements (“COSA”) with these refineries. The Company’s domestic crude

oil produced from nominated fields, other than crude oil produced in North Eastern States, is benchmarked to

Nigerian Bonny Light crude. The crude oil produced from North Eastern States (including Assam) is

benchmarked to a basket of internationally traded crude oils as advised by the MoPNG.

A39729228 214

The Company supplies the majority of gas that it produces to GAIL as per a gas supply agreement

entered with GAIL on 7 July 2006 for a period of 15 years. The Company also supplies natural gas to Assam

Gas Company Limited in Assam and directly to various small and medium industrial consumers across India.

Most of the Company’s crude oil and gas sales agreements are depletion-based contracts where the

Company forecasts quantities from time to time based on field conditions. These contracts are intended to limit

commercial exposure and avoid over commitments.

Transportation of Crude Oil and Natural Gas

As of 31 March 2019, the Company’s domestic onshore production facilities include over 22,272 km.

of pipeline (including internal well flow lines) and the Company’s offshore platforms are connected to each

other and to the Company’s land-based facilities by a network of over 6,732 km of pipeline. The pipelines are

meant for upstream operations of crude oil and natural gas production.

Transportation of Crude Oil

The crude oil the Company produces in Mumbai offshore is primarily transported through pipelines to a

shore terminal at Uran, from which it is then transported through land and sea pipelines to Mumbai-based

refineries and to other refineries by marine vessels that are loaded from the ports of Jawahar Dweep and

Jawaharlal Nehru Port Trust. Small quantities of crude oil are transported directly from offshore locations to

coastal refineries by ship using dedicated SPM and Floating Production Storage and Offloading facilities.

The crude oil produced from onshore fields in the western and eastern regions is transported through

pipelines directly to the refineries. In the eastern region, the crude oil is transported through the Company

pipeline and a pipeline owned and operated by OIL. In the western onshore region, the crude oil produced is

supplied to IOCL’s Gujarat Refinery through pipeline. The Company’s crude oil production from Krishna-

Godavari basin is currently transported by road to the holding site at Sursani Yanam where it is loaded, along

with crude oil from Ravva, into ocean tankers and shipped to Chennai Petroleum Corporation Limited’s refinery

in Chennai, MRPL’s Mangalore Refinery and/or HPCL’s Mumbai Refinery and Visakh Refinery. The

Company’s crude oil production from Cauvery basin is transported by pipeline to the nearby Chennai Petroleum

Corporation Limited’s mini-refinery which is now proposed to be loaded for coastal movement to the buyers.

Transportation of Natural Gas

The Company delivers natural gas to its customers at its inland installation fence. Further mid-stream

transportation of major quantities of natural gas is carried out by GAIL and other customers, which is regulated

by the Petroleum and Natural Gas Regulatory Board of India (“PNGRB”). The Company has a large network

of offshore pipelines as part of its upstream network through which natural gas is transported to terminals of

Uran and Hazira plants for processing, and thereafter it is delivered for sale to GAIL from the inland installation

fences of these terminals.

Refining Business and Value-Added Products

In addition to the production of crude oil and natural gas, the Company also produces several value-

added products, including LPG, naphtha, kerosene, aviation turbine fuel, pure ethane, pure propane, pure

butane, ethane-propane mix, high speed diesel of marine fuel grade, low sulphur heavy stock and sulphur. For

the 2017 Fiscal Year, the 2018 Fiscal Year and the 2019 Fiscal Year, the Company produced 13.55MMT, 13.82

MMT and 13.63 MMT of HSD, respectively. For the 2017 Fiscal Year, the 2018 Fiscal Year and the 2019 Fiscal

Year, the Company produced 4.59MMT, 4.71MMT, and 4.60MMT of MS, respectively. For the 2017 Fiscal

Year, the 2018 Fiscal year and the 2019 Fiscal Year, the Company produced 1.96 MMT, 1.98MMT, and 2.15

MMT of ATF, respectively. For the 2017 Fiscal Year, the 2018 Fiscal Year and the 2019 Fiscal Year, the

Company produced 3.06 MMT, 2.90MMT and 2.98 MMT of LPG. For the 2017 Fiscal Year, the 2018 Fiscal

Year and the 2019 Fiscal Year, the Company produced 0.59 MMT, 0.50 MMT and 0.45 MMT of kerosene,

A39729228 215

respectively. For the 2017 Fiscal Year, the 2018 Fiscal Year and the 2019 Fiscal Year, the Company produced

3.31 MMT, 3.41 MMT and 3.49 MMT of naphtha, respectively. The Company produced approximately 0.65

MMT, 0.81 MMT and 1.08 MMT of ethane-propane for the 2017 Fiscal Year, the 2018 Fiscal Year and the 2019

Fiscal Year, respectively.

The Company is one of the major domestic refiners in India and strives to continuously upgrade its

refineries to increase refining capacity, identify and improve bottlenecks, implement bottom upgrades and

improve the overall quality of its end products. For the 2017 Fiscal Year, the 2018 Fiscal Year and the 2019

Fiscal Year, the Company processed 34.08 MMT (252.25 MMbbls), 34.59 MMT (256.01 MMbbls) and 34.87

MMT (257.07 MMbbls) of crude oil, respectively.

Refineries

Mangalore Refinery

The Company, through its subsidiary MRPL, owns and operates the Mangalore Refinery. The Mangalore

Refinery facility has loading facilities that include two dedicated oil jetties equipped to handle ocean tanker

deliveries of crude oil and off-take of refined products. On 30 August 2013, the Company completed the

commissioning of an SPM station at its jetty for handling very large crude carriers, resulting in port de-

congestion and marginal savings on freight. For the 2017 Fiscal Year, the 2018 Fiscal Year and the 2019 Fiscal

Year, MRPL processed 16.27 MMT (118.67 MMbbls), 16.31 MMT (118.91 MMbbls) and 16.43 MMT (118.77

MMbbls) of crude oil, respectively. In addition, for the 2017 Fiscal Year, the 2018 Fiscal Year and the 2019

Fiscal Year, MRPL produced 14.63 MMT, 14.65 MMT and 14.74 MMT of refined products, respectively.

MRPL produces and markets a variety of refined petroleum products, primarily to HPCL, IOCL and BPCL. In

cases where production exceeds domestic demand, MRPL markets its excess production to various exporters.

MRPL sources its feedstock primarily through foreign supply contracts. MRPL has entered into a feedstock

supply contract with National Oil Companies of Saudi Arabia, Kuwait, UAE, Iraq, etc. MRPL receives the

Mangalore Refinery’s remaining crude oil requirements primarily from its Mumbai High offshore production

facilities and from and other domestic sources. The expansion to increase the Mangalore Refinery’s capacity to

15 MMTPA was completed in April 2014. MRPL has successfully commissioned the polypropylene unit in

June 2015 and started Commercial production of polypropylene from its 440 KTPA polypropylene unit on 18

June 2015. This enabled the Company to facilitate the upgrading of low-value products to high-value products

and to refine crude oil with higher sulphur content, lower API and higher TAN and to upgrade the Company’s

entire high-speed diesel yield into BS IV/VI grade. The expansion also allowed the Company to commence

production of paraxylene, benzene, petroleum coke and polypropylene.

Recently on 17 August 2019, the Mangalore Refinery was affected by a minor landslide as an aftermath

of the intensified monsoon in the Dakshina Kannada district (the “Landslide Incident”). As a precautionary

measure, MRPL had arranged for a temporary partial shutdown of the phase-III process units of the Mangalore

Refinery from 18 August 2019 in order to access the condition of the facilities in the vicinity and for immediate

stabilisation of the phase-III process units. The phase-III process units of the Mangalore Refinery are expected

to recommence operations by mid-September 2019. The phase-I process units, phase-II process units and the

product dispatch facilities of of the Mangalore Refinery were not affected by the Landslide Incident and remain

in operation.

Mumbai Refinery and Visakh Refinery

The HPCL Acquisition was a defining move that significantly transformed the Company’s downstream

portfolio. For the 2017 Fiscal Year, the 2018 Fiscal Year and the 2019 Fiscal Year, HPCL processed 17.81 MMT

(133.58 MMbbls), 18.28 MMT (137.10 MMbbls) and 18.44 MMT (138.30 MMbbls) of crude oil, respectively.

Following the HPCL Acquisition, the Company’s refining capacity increased from 15.00 MMTPA (112.50

A39729228 216

MMbbls) as of 31 March 2018 to 30.83 MMTPA (231.23 MMbbls) as of 31 March 2019, which represents

approximately 12.35 per cent. of India’s total refining capacity as of 31 March 2019.

The Mumbai Refinery and Visakh Refinery produces and markets a variety of refined petroleum

products. HPCL operates strategic business units designed to market such products and to meet the needs of

various customer segments, namely retail, LPG, direct sales (lubes, industrial and customers) and aviation (jet

fuel). Commissioned in 1954, the Mumbai Refinery has been modernised and expanded over the years from its

initial capacity of 1.25 MMTPA to its current 7.5 MMTPA capacity. The Mumbai Refinery is capable of

processing different types of crude oil. The production slate includes light (such as gasoline (MS) and LPG),

middle (such as kerosene, gas oil (diesel) and jet (aviation) fuel), heavy distillates (such as furnace oil and

bitumen) and Group II/III lube oil base stocks. HPCL, sources its feedstock primarily through foreign supply

contracts. HPCL has entered into term contracts with oil companies from the Gulf region including suppliers

from Saudi Arabia, UAE, Iraq and Iran etc. HPCL receives the Mumbai Refinery’s remaining crude oil

requirements through term contracts and spot purchases. The Mumbai Refinery is undergoing a revamp

including an upgrade of the residue streams and to increase the its refining capacity to 9.5 MMTPA to help meet

the growing demand for petroleum products. This upgrade will enable the Mumbai Refinery to produce BS VI

(Euro VI) compliant products by 2020 as required by the Auto Fuel Policy Guidelines. The upgrade of the

Mumbai Refinery is scheduled for completion in January 2020.

Commissioned in 1957, the Visakh Refinery has been modernised and expanded over the years from its

initial capacity of 0.65 MMTPA to its current 8.33 MMTPA capacity. HPCL owns and operates a 0.3-MMTPA

crude cavern storage at the Visakh Refinery. The Visakh Refinery also has a single point mooring facility which

allows receipt of crude oil through very large crude carriers thus reducing transportation costs. The Visakh

Refinery is capable of processing different types of crude oil. The product slate includes light (such as gasoline

(MS), naphtha and LPG), middle (such as kerosene, gas oil (diesel) and jet (aviation) fuel), heavy distillates

(such as furnace oil and bitumen) and speciality products such as hexane and mineral turpentine oil. HPCL,

sources its feedstock primarily through foreign supply contracts. HPCL has entered into term contracts with oil

companies from the Gulf region including suppliers from Saudi Arabia, UAE, Iraq and Iran etc. HPCL receives

the Visakh Refinery’s remaining crude oil requirements through term contracts and spot purchases. The Visakh

Refinery is undergoing a revamp including an upgrade of residue streams and to increase its refining capacity

to 15 MMTPA to help meet the growing demand for petroleum products. This upgrade will enable the Visakh

Refinery to produce distillates, petcoke and Euro VI compliant products by 2020 as required by the Auto Fuel

Policy Guidelines. The upgrade of the Visakh Refinery is scheduled for completion in July 2020.

Other Refineries

HPCL owns and operates the largest lubricant refinery in India, which produces lubricant base oils and

has a capacity of 428 TMT. Based on the management’s internal estimates, the lubricant refinery accounts for

over 40 per cent. of India’s total lubricant base oil production as of 31 March 2019.

HPCL operates, in conjunction with Mittal Energy Investments Pte. Ltd, the GGS Refinery, in the state

of Punjab, with a capacity of 9 MMTPA which was commissioned in 2012. The GGS Refinery is regarded as

an energy efficient, environment-friendly, high distillate yielding complex which has been designed to produce

high value added petroleum products. The GGS Refinery recently completed its capacity expansion to 11.3

MMTPA in 2017. For the 2019 Fiscal Year, the GGS Refinery recorded highest ever crude throughput of 12.47

MMT. HPCL has marketing rights to the products produced by the GGS Refinery. This refinery is strategically

located in the northern part of India and HPCL has leveraged this strength by constructing cross-country

pipelines for transport of the products to meet the demand in the north, north central and eastern parts of India.

In addition, HPCL is currently in the process of establishing the Pachpadra Refinery through a joint

venture company, HRRL. HRRL is a joint venture arrangement between HPCL and the Rajasthan Government

with HPCL and the Rajasthan Government having a 74.00 per cent. and 26.00 per cent. ownership of HRRL

A39729228 217

respectively. The cost of the project is estimated to be approximately Rs. 431.29 billion. HPCL has made strong

progress on the construction development of the Pachpadra Refinery with completion of technology selection

for all the 13 process units of the Pachpadra Refinery and engineering works at the various offices in progress.

The construction of the Pachpadra Refinery is scheduled for completion in October 2022.

Maintenance of Refineries

Each of the units at the refineries requires regular maintenance, repair and upgrade shutdowns (also

referred to as turnarounds), during which times these units are not operational. The Mangalore Refinery, the

Mumbai Refinery and the Visakh Refinery have multiple trains of units. Therefore, maintenance does not

require shutdown of the entire refinery and turnarounds are taken in a staggered manner so as to minimise

production disruptions. Regular maintenance and inspection turnaround for a process unit is performed once

every four years. A two-year turnaround schedule is prepared for all units, utilities and offsites. During each

turnaround, the remaining trains are in operation and the affected product(s) are adequately stocked prior to

each scheduled turnaround to help ensure that customers are not inconvenienced.

Turnarounds are generally planned in the previous year based upon the recommendation and requirements

of the maintenance, inspection, technology and operations group. The Company has also adopted the latest

turnaround techniques and best practices such as chemical decontamination of the unit, mechanical decoking

of heater coils, dedicated safety organisation of contractor and comprehensive contract including project jobs.

Turnaround work is generally executed on a 24-hour basis without any breaks to minimise unit down time.

Other Plants and Facilities

The Company is also engaged in petrochemicals and other segments of the hydrocarbon value chain for

the production of other value-added products, which include the following:

the Company operates its C2-C3 Extraction Plant and a value-chain integration project located in the

Dahej special economic zone (“DSEZ”). The C2+ fraction extraction plant at DSEZ was commissioned

in July 2015 and produces pure ethane, propane and butane from LNG with a throughput capacity of 5.0

MMTPA of feed LNG and provision for an additional train of 4.0 MMTPA capacity. The Company

supplies the feedstock requirement of OPaL’s petrochemical complex at DSEZ through such C2+

fraction extraction plant;

the Company operates a skid mounted refinery plant at Tatipaka in Andhra Pradesh with a capacity of

0.66 MMTPA for the production of low sulphur heavy stock such asHigh Speed Diesel;

the Company operates a crude stabilisation unit at Uran, Maharashtra (the “Uran Plant”) which was

established in 1978. The Uran Plant has five crude oil stabilisation trains (capable of handling

approximately 25MMTA of crude oil), three gas sweetening units (capable of handling approximately

15.75 MMSCMD of Gas), Three LPG recovery units (capable of handling approximately 16.95

MMSCMD), one Ethane-Propane recovery unit (capable of handling approximately 8.91 MMSCMD of

gas) and three Condensate fractionating units (capable of handling approximately 35 tonnes per hour

(“TPH”), 60 TPH and 100 TPH, respectively, of Condensate). On the utilities front, the Uran Plant has

an in-house installed capacity for generating 60 MW of power and produce 390 TPH of steam;

the Company operates three sour gas-processing complexes in India situated at Hazira (the “Hazira

Plant”), Surat, Gujarat which were set up in 1985 with an aggregate capacity of processing

approximately 46.90 MMSCMD of sour natural gas and approximately 10800 M3/day of sour

Condensate to produce sweet gas and value added products, including LPG- 5.27 MMSCM/Day (gas

feed), Naphtha, SKO, ATF and HSD. On the utilities front, the Hazira Plant has an in-house installed

capacity for generating 61 MW of power and production of 580 TPH of steam;

A39729228 218

the Company through Petronet LNG, successfully established India’s first LNG receiving and

regasification terminal at Dahej, Gujarat, and other terminals at Kochi, Kerala. The Dahej terminal has

a nominal capacity of 15 MMTPA and its capacity is in the process of being expanded to 17.5 MMTPA.

Kochi terminal has a capacity of 5 MMTPA. Petronet LNG is also exploring suitable opportunities within

and outside India to expand its business presence;

the Company through OPaL operates a mega petrochemical complex in DSEZ established for utilizing

C2-C3 gas feed and Naphtha from the Company’s nearby extraction C2-C3 extraction plant at Dahej

and Naphtha from gas processing plants at Hazira and comprises a 1.10 MMTPA Ethylene Cracker. The

Polymer plants of OPaL consist of two 360 kilo-tonnes per annum (“KTPA”) of LLDPE/HDPE swing

units, one 340 KTPA of dedicated HDPE and one 340 KTPA of PP; The project was inaugurated by the

Prime Minister of India in March 2017 and began producing petrochemical products such as

polypropylene, HDPE, LLDPE, butadiene and benzene in the 2017 Fiscal Year;

the Company through OMPL, operates a value-chain integration project for manufacturing para-xylene

(0.92 MMTPA capacity) and benzene (0.28 MMTPA capacity) from the aromatic streams of MRPL. The

complex is designed to produce 914 KTPA of high purity para-xylene and around 283 KTPA of high

purity Benzene products which are sold internationally. This complex is licensed by Universal Oil

Products Ltd., a pioneer in petrochemical technology. OMPL started its commercial production in 2014

and has been progressively increasing its capacity utilisation since.

In addition, the Company, through HPCL, continues to focus on augmenting the bottling capacity in tandem

with growing demand for LPG. For the Fiscal Year 2019, a new LPG bottling plant was commissioned by HPCL

at Warangal in Telangana with bottling capacity of 60 TMPTA. Bottling capacity augmentation projects were

also completed at LPG bottling plants in Chakan (Maharashtra), Jamshedpur (Jharkhand), Madurai (Tamil

Nadu), Gorakhpur (Uttar Pradesh), Nashik and Aurangabad (Maharashtra) with total capacity addition of 330

TMTPA during the year. Storage capacity augmentation projects were also completed at LPG bottling plants in

Mysore (Karnataka) and Patna (Bihar) during the year. To improve productivity and operational efficiency of

LPG locations, downstream bottling facilities were also upgraded by HPCL at 44 LPG bottling plants and LPG

filling carousals with 24 heads were replaced with higher capacities at seven LPG bottling plants. Work has

commenced for setting up LPG bottling plants at Harsidhi (Bihar) and Rayagada (Odisha) with planned bottling

capacities of 120 TMTPA and 60 TMTPA respectively. To further enhance the LPG storage capacity, an

underground LPG cavern project with estimated capacity of 80,000 MT has been planned at Mangalore.

Sales and Marketing of Value-Added Products

Sales of value-added products, including naphtha, ethane, propane, butane, LPG, superior kerosene oil,

aviation turbine fuel and low sulphur heavy stock also form a part of the Company’s revenues. The Company

consumes internally a portion of the high-speed diesel it produces, which reduces the costs of the Company’s

operations. The Company supplies products such as LPG and superior kerosene oil, whose prices the Indian

Government controls, to various public sector oil marketing companies in accordance with the applicable

MoPNG guidelines, while its markets other products either directly to bulk purchasers or to public sector oil

marketing companies. The Company is a major exporter of naphtha and has been awarded the “Premier Trading

House” status by the Directorate General of Foreign Trade, Ministry of Commerce, based on the Company’s

export performance in the past. The Company also supplies petrochemical feedstock, including pure ethane and

a mix of ethane and propane.

For the 2017 Fiscal Year, the 2018 Fiscal Year and the 2019 Fiscal Year, the Company sold 20.97 MMT,

21.40 MMT and 22.85 MMT of High Speed Diesel, respectively. For the 2017 Fiscal Year, the 2018 Fiscal Year

and the 2019 Fiscal Year, the Company sold 4.15 MMT, 4.25 MMT and 4.21 MMT of MS, respectively. For

the 2017 Fiscal Year, the 2018 Fiscal Year and the 2019 Fiscal Year, the Company sold 2.03 MMT, 2.04 MMT

A39729228 219

and 2.29 MMT of ATF, respectively. For the 2017 Fiscal Year, the 2018 Fiscal Year and the 2019 Fiscal Year,

the Company sold 7.03 MMT, 7.34 MMT and 7.70 MMT of LPG, respectively. For the 2017 Fiscal Year, the

2018 Fiscal Year and the 2019 Fiscal Year, the Company also sold 1.19 MMT, 0.79 MMT and 0.74 MMT of

kerosene, respectively. In addition, for the 2017 Fiscal Year, the 2018 Fiscal Year and the 2019 Fiscal Year, the

Company sold 3.29 MMT, 3.39 MMT and 3.51 MMT of naphtha, respectively, and 0.67 MMT, 0.91 MMT and

1.19 MMT of ethane-propane-butane, respectively.

Transportation of Value-Added Products

The Company through PMHBL, operates a cross-country petroleum products pipeline that allows the

transportation of a variety of finished petroleum oil products, such as kerosene, diesel and MS, from the

Mangalore Refinery to Devangonthi in Bangalore, with a tap-off point at Hassan, located in the interior of the

state of Karnataka. As of 31 March 2019, this pipeline is 362.37 km. In addition, the Company through HPLC,

operates a petroleum product pipeline network of 3,370 km with mainline capacity of 24.93 MMTPA and branch

line capacity of 11.07 MMTPA as of 31 March 2019. Pipeline network expansion remains a major focus area

for the Company and a number of large-scale expansion projects are underway with an estimated investment of

Rs. 5,916 crore. These projects are expected to increase the mainline capacity to 33.70 MMTPA and network

length to approximately 4,500 km and significant strengthen the Company's position in key markets. For the

Fiscal Year 2019, pipeline project for capacity expansion of Ramanmandi Bahadurgarh Pipeline from 4.71

MMTPA to 7.11 MMTPA was completed as per the scheduled timelines. The Company’s, through HPCL, major

ongoing pipeline infrastructure projects include: (a) capacity expansion of Mundra Delhi Pipeline from 5

MMTPA to 6.9 MMTPA along with extension of branch pipeline from Palanpur to Vadodara (235 km) and

construction of green field marketing terminal at Vadodara, (ii) capacity expansion of Visakh Vijayawada

Secunderabad Pipeline (“VVSPL”) from 5.38 MMTPA to 7.7 MMTPA (iii) extension of VVSPL from

Vijayawada to Dharmapuri (697 km) and construction of marketing terminal at Dharmapuri and (iv) Uran

Chakan Shikrapur LPG Pipeline (168 km) of 1 MMTPA capacity. The Company, through HPCL, is also

participating in development of India’s longest LPG pipeline from Kandla to Gorakhpur (2,757 km) along with

IOCL and BPCL.

The ethane and propane the Company produces at its Uran plant are transported through pipelines, the

LPG the Company produces at its Hazira, Uran, Ankleshwar and Gandhar plants is transported through

pipelines, rail rakes and road tankers. The kerosene the Company produces at its Hazira and Tatipaka plants is

transported through pipelines, rail or road tankers. plant at Kuthalam is non-functional at present. The ethane,

propane and butane the Company produces at its Dahej plant are supplied as feedstock to OPaL at Dahej. The

naphtha the Company produces at its Hazira plant is currently supplied to OPaL through the coastal route. The

naphtha the Company produces at its Uran plant is planned to be exported and supplied through pipeline to

OPaL together with the naphtha produced at Hazira, Ankleshwar and Gandhar. The naphtha the Company

produces at its Tatipaka is currently being sold to domestic buyers.

Joint Ventures and Associates

ONGC Tripura Power Company Limited (“OTPC”)

OTPC is a joint venture among the Company, Infrastructure Energy Development Company Limited

(“IEDCL”), the Government of the State of Tripura and India Infrastructure Fund-II acting through IDFC

Alternatives Ltd. As of 31 March 2019, the Company held a 50.00 per cent. equity interest, IEDCL held a 12.03

per cent. equity interest, IL&FS Financial Services Ltd. (IFIN) held a 13.97 per cent. equity interest, the Tripura

government held a 0.50 per cent. equity interest and Global Infrastructure Partners (GIP) held a 23.50 per cent.,

in OTPC. The total cost of the project was Rs. 40,470 million.

OTPC has also set up a 726.6 MW (two units of 363.3 MW each) combined cycle gas turbine-based

power plant at Pallatana, Tripura. The Company’s Tripura Asset is supplying natural gas for the power plant.

A39729228 220

This has enabled the Company to monetise a portion of its natural gas reserves in the Tripura region, which was

otherwise lying idle due to the lack of an adequate market in the region. Unit-I (363.3 MW) and Unit-II (363.3

MW) commenced its commercial operations on 4 January 2014 and 24 March 2015, respectively. Power

evacuation for both power units is done through a 663 km long 400 KV double circuit transmission network

operated by the North-East Transmission Company Limited, a joint venture between the Power Grid

Corporation, OTPC and the governments of the North-Eastern states of India. OTPC sells 86.50 per cent. of its

generation under a power purchase agreement with seven north-east states under the CERC tariff with the

remaining 13.50 per cent. balance of power sold as merchant sales.

For the 2017 Fiscal Year, the 2018 Fiscal Year and the 2019 Fiscal Year, OTPC recorded a consolidated

profit after tax of Rs. 1,385 million, Rs. 1,427 million and Rs. 2,139 million, respectively.

ONGC Petro-additions Limited (“OPaL”)

OPaL is a joint venture among the Company, GAIL, GSPC. As of 31 March 2019, the Company held a

49.36 per cent. equity interest in this project, while GAIL and GSPCL held a 49.21 per cent. and a 1.43 per cent.

equity interest, respectively. The joint venture was established to construct a mega petrochemical project in

DSEZ for utilizing C2-C3 gas feed and Naphtha from the Company’s nearby extraction C2-C3 extraction plant

at Dahej and Naphtha from gas processing plants at Hazira and comprises a 1.10 MMTPA Ethylene Cracker at

a project cost of Rs. 308,260 million. The project features a dual feed cracker unit which has capacity to produce

1,100 KTPA Ethylene and 400 KTPA Propylene, with the associated units consisting of pyrolysis gasoline unit,

hydrogenation unit, butadiene and benzene extraction unit. The Polymer plants of OPaL consist of two 360

KTPA of Linear Low-Density Polyethylene (LLDPE) / High Density Polyethylene (HDPE) swing units, one

340 KTPA of dedicated HDPE and one 340 KTPA of PP.

The project was inaugurated by the Prime Minister of India in March 2017 and began producing

petrochemical products such as Polypropylene, HDPE, LLDPE, Butadiene and Benzene in the 2017 Fiscal Year.

For the 2018 Fiscal Year and the 2019 Fiscal Year, OPaL generated revenue from operations of Rs. 55,918

million and Rs. 97,387 million, respectively.

Dahej Special Economic Zone Limited and Mangalore Special Economic Zone Limited

The Company made a strategic decision to locate its major export-oriented joint ventures within special

economic zones. Accordingly, the Company, together with the respective state government industrial

development agencies, established special economic zones at Dahej in the State of Gujarat and Mangalore in

the State of Karnataka.

Dahej Special Economic Zone Limited (“DSEZL”)

The DSEZ is a multi-product special economic zone at Dahej in coastal Gujarat with world-class mega

infrastructure facilities. The DSEZ is fully operational with the Company’s C2-C3 Extraction Plant and

a value-chain integration project located therein. As of 31 March 2019, the Company and Gujarat

Industrial Development Corporation each held an equity interest of 50.00 per cent. For the 2017 Fiscal

Year, the 2018 Fiscal Year and the 2019 Fiscal Year, DSEZL generated revenue from operations of Rs.

536 million, Rs. 535 million and Rs. 578 million (unaudited), respectively, and recorded a profit after

tax of Rs. 311 million, Rs. 349 million and Rs. 328 million (unaudited), respectively.

Mangalore Special Economic Zone Limited (“MSEZL”)

MSEZL is a joint venture company incorporated in February 2006. As of 31 March 2019, the Company

held a 26.86 per cent. equity interest in MSEZL. The special economic zone is established in

coordination with the Karnataka Industrial Area Development Board, the industrial development agency

of the State of Karnataka, which holds a 23.00 per cent. equity interest, Infrastructure Leasing and

Finance Services Limited, which holds a 50.00 per cent. equity interest, and Kanara Chamber of

A39729228 221

Commerce and Industries, which holds a 0.04 per cent. equity interest, as of 31 March 2019. OMPL held

the remaining 0.96 per cent. equity interest. MSEZ was initially designated as a sector-specific special

economic zone for petroleum and petrochemicals in November 2007 but has been upgraded to a multi-

product special economic zone since September 2013. MSEZL commenced commercial operation since

1 April 2015. For the 2017 Fiscal Year, the 2018 Fiscal Year and the 2019 Fiscal Year, MSEZL generated

revenue from operations of Rs. 1,285 million, Rs. 1,742 million and Rs. 2,068 million, respectively, and

recorded a loss of Rs. 60 million and a profit of Rs. 37 million and Rs. 24 million, respectively.

ONGC Mangalore Petrochemicals Limited (“OMPL”)

OMPL is a value-chain integration project for manufacturing para-xylene (0.92 MMTPA capacity) and

benzene (0.28 MMTPA capacity) from the aromatic streams of MRPL. OMPL is a subsidiary of MRPL. As of

31 March 2019, MRPL and the Company held a 51.00 per cent. and 48.99 per cent. equity interest respectively

in OMPL. The complex is designed to produce 914 KTPA of high purity para-xylene and around 283 KTPA of

high purity Benzene products which are mainly sold internationally. This complex is licensed by Universal Oil

Products Ltd., a pioneer in petrochemical technology. The total cost of this project was Rs. 69,114.60 million,

funded through issue of non-convertible debentures of Rs. 25,000.00 million, an ECB loan of U.S.$331.32

million and the remaining through equity offerings. OMPL started its commercial production since 2014 and

has been progressively increasing its capacity utilisation since. For the 2017 Fiscal Year, the 2018 Fiscal Year

and the 2019 Fiscal Year, OMPL generated revenue from operations of Rs. 52,566 million, Rs. 55,613 million

and Rs. 83,624 million, respectively.

ONGC TERI Biotech Limited (“OTBL”)

OTBL is a joint venture company incorporated in 2007 between the Company and The Energy Research

Institute (“TERI”). As of 31 March 2019, the Company, TERI and various individuals held a 49.98 per cent.,

48.02 per cent. and 2.00 per cent. equity interest respectively in OTBL. OTBL focuses on the bioremediation

of oily sludge, microbial enhanced oil recovery, prevention of wax deposition in tubulars and solutions for other

oil field problems. For the 2017 Fiscal Year, the 2018 Fiscal Year and the 2019 Fiscal Year, OTBL generated

revenue from operations of Rs. 177 million, Rs. 178 million and Rs. 216 million, respectively and recorded a

profit after tax of Rs. 55 million, Rs. 81 million and Rs. 67 million, respectively.

Petronet MHB Limited (“PMHBL”)

The Company jointly owns the Mangalore-Hassan-Bangalore cross-country petroleum products pipeline

through a joint venture, PMHBL. As of 31 March 2019, the Company and HPCL each held 32.72 per cent.

equity interest in PMBHL with the balance 34.56 per cent. of equity interest held by leading banks. It owns and

operates a multi-product pipeline to transport MRPL's products from the Mangalore Refinery. Throughput for

the 2017 Fiscal Year, the 2018 Fiscal Year and the 2019 Fiscal Year was 3.43 MMT, 3.50 MMT and 3.36 MMT,

respectively. The pipeline is 362.37 km. and runs from the Company’s refinery in Mangalore to Devangonthi

in Bangalore, with a tap-off point at Hassan, located in the interior of the state of Karnataka. This pipeline

allows the transportation of a variety of finished petroleum oil products, such as kerosene, diesel and MS, from

the Company’s refinery to cities in Karnataka. For the 2017 Fiscal Year, the 2018 Fiscal Year and the 2019

Fiscal Year, PMHBL generated revenue from operations amounting to Rs. 1,283 million, Rs. 1,309 million and

Rs. 1,584 million, respectively and recorded a profit after tax of Rs. 809 million, Rs. 835 million and Rs. 1,118

million, respectively.

Petronet LNG Limited (“Petronet LNG”)

Petronet LNG has successfully established India’s first LNG receiving and regasification terminal at

Dahej, Gujarat, and other terminals at Kochi, Kerala. The Dahej terminal has a nominal capacity of 15 MMTPA

and its capacity is in the process of being expanded to 17.5 MMTPA. Kochi terminal has a capacity of 5

A39729228 222

MMTPA. Petronet LNG is also exploring suitable opportunities within and outside India to expand its business

presence.

As of 31 March 2019, the Company held a 12.50 per cent. equity interest in Petronet LNG while each

of IOCL, GAIL and BPCL also held a 12.50 per cent. equity interest in Petronet LNG. The remaining shares of

Petronet LNG are held by private investors. For the 2017 Fiscal Year, the 2018 Fiscal Year and the 2019 Fiscal

Year, Petronet LNG generated consolidated revenue from operations amounting to Rs. 246,160 million, Rs.

305,986 million and Rs. 383,954 million, respectively and recorded a consolidated profit after tax of Rs. 17,231

million, Rs. 21,104 million and Rs. 22,306 million, respectively.

Pawan Hans Limited (“PHL”)

As of 31 March 2019, the Company held a 49.00 per cent. equity interest in PHL and the Indian

Government held the remaining 51.00 per cent. equity interest. PHL is engaged in the business of, inter alia,

planning, promoting, developing, organising, providing and operating air support services to meet the

requirements of the petroleum sector, including helicopter services, and providing such other services as may

be determined. PHL provides helicopter support for the Company’s offshore operations. For the 2017 Fiscal

Year, the 2018 Fiscal Year and the 2019 Fiscal Year (unaudited), PHL generated revenue from operations

amounting to Rs. 4,276 million, Rs. 3,954 million and Rs. 3,804 million, respectively and recorded a profit after

tax of Rs. 2,539 million, Rs. 196 million and a loss of Rs. 724 million, respectively.

Indra Dhanush Gas Grid Limited (“IGGL”)

IGGL is a joint venture between the Company, OIL, GAIL, IOCL and Numaligarh Refinery Limited. As

of 31 March 2019, the Company held a 20.00 per cent. equity interest in IGGL while each of OIL, GAIL, IOCL

and Numaligarh Refinery Limited also held a 20.00 per cent. equity interest in IGGL. IGGL received

provisional authorisation from the PNGRB for laying, building operating and expanding the north east gas grid

on 14 September 2018. The envisaged capacity of pipeline is 4.75 MMSCMD with total length of 1656 Km

with total capital expenditure estimated to be approximately Rs. 90,000 million. The gas grid is strategically

located in north east part of the country and will connect the capital city of Assam, Arunachal Pradesh,

Meghalaya, Manipur, Mizoram, Nagaland and Tripura. The gas-based power plant, fertiliser plant, CGD

network are expected to drive gas demand in the future. The gas grid is expected to be completed in June 2022.

Other Projects and Business Initiatives

Memorandum of Understanding with Pemex Exploracion Y Produccion, Mexico

A memorandum of understanding was signed between Pemex-Exploracion Y Produccion (PEP), the

upstream subsidiary of Pemex, the national oil company of Mexico, and ONGC Videsh on 25 September 2014

for the cooperation in hydrocarbon sector. The initial term of the memorandum of understanding was three

years. The term has been extended by two more years until 24 September 2019. The scope of the MOU includes

cooperation in upstream sector in Mexico, India and other countries.

SherkatTose’eveSanayeNeft-o-GazGhostaresh, Iran

A memorandum of understanding has been signed with SherkatTose’eveSanayeNeft-o-GazGhostaresh

Iranian, an affiliate of the Industrial Development and Renovation Organization of Iran (“IDRO”) on 12

February 2018 for evaluation of the project assigned to IDRO by NIOC and the business collaboration between

the two companies in upstream projects in Iran. The memorandum of understanding will expire on 11 February

2020.

GeoPark, Latin America

ONGC Videsh and Geo Park Limited, a Latin America focused exploration and production company,

entered into a memorandum of understanding on 16 February 2018 on cooperation for acquiring certain oil and

A39729228 223

gas assets in Latin America. The memorandum of understanding envisages the formation of a new long-term

strategic partnership to jointly acquire and invest in upstream oil and gas projects with the objective of building

a large-scale, economically-profitable and risk-balanced assets portfolio and operations across Latin America.

The memorandum of understanding is valid for three years from the effective date.

UzbekNefteGaz, Uzbekistan

A Cooperation Agreement was executed on 28 September 2018 between ONGC Videsh and

UzbekNefteGaz to jointly explore and assess potential opportunities in exploration blocks, under development

assets and producing fields/blocks located within the Republic of Uzbekistan and other countries in the

upstream sector with an initial term of two years. A joint working team with members from UzbekNefteGaz

and ONGC Videsh is formed and preliminary data is under review.

C2-C3-C4 Extraction Plant

The C2-C3-C4 plant has been set up to extract rich fractions (C2, C3 and C4) from LNG sourced by

Petronet LNG Limited to capitalise on the opportunity for the conversion of rich fractions to olefins and further

conversion to polymers as part of a value chain integration strategy. This plant is based on a method of extracting

rich fractions by utilising the cryogenic temperature of LNG in contrast to conventional C2-C3 fraction

extraction plants based on natural gas. The capital and operating costs for the new process are lower than those

of conventional processes. The products of the C2+ fraction extraction plant at Dahej will also serve as feedstock

for the upcoming petrochemical plant by OpaL. The plant was commissioned in the month of July 2015.

Competition

Although the Company encounters competition from other oil and natural gas companies in all areas of

its operations, it believes the primary area in which it faces competition domestically is for the acquisition of

licences for exploration prospects in the bidding processes pursuant to NELP and subsequently since 2016,

HELP and the OALP. The companies that have been granted exploration licences in various rounds of the NELP

bidding process include other Indian public-sector companies and over 50 private companies, both domestic

and international, including British Petroleum, Petro Gas, Reliance Industries Limited and Essar Oil Limited.

The Company expects that OALP will enhance competition for India’s exploration acreages and permit

increased competition from smaller crude oil and natural gas companies. Internationally, the Company faces

competition primarily in the acquisition of petroleum reserves, and its primary competitors include national oil

companies as well as the major privately-owned exploration and production companies.

Research and Development

The Company has significant research and development capabilities and focuses on developing

increasingly efficient and effective exploration, development and production methods. Recent examples of the

Company’s efforts include (i) development plans for improved oil recovery, (ii) technology schemes for

enhanced oil recovery and microbial enhanced oil recovery, (iii) use of paraffin degrading bacteria and flow

assurance, (iv) cooperation with the Energy and Resources Institute to develop techniques for rapid detection

of gaseous hydrocarbon oxidisers for geo-microbial surveys, (v) development of a process for mass cultivation

of selected microalgae for hydrocarbon production, (vi) exploring the feasibility of establishing a nuclear power

project, (vii) development of customised techniques and formulations for well stimulation, water and gas control

and (viii) oil and gas production enhancement through innovative artificial lift solutions.

The Company’s research and development institutes are equipped with laboratories, computer

processing systems and computer workstations, and employ specialised multidisciplinary expert teams. For the

2017 Fiscal Year, the 2018 Fiscal Year and the 2019 Fiscal Year, the Company spent Rs. 6,210.95 million, Rs.

6,058.66 million and Rs. 6,371.58 million, respectively, on its research and development activities, which

represented 0.80 per cent., 0.71 per cent. and 0.58 per cent., respectively, of non-consolidated revenue from

A39729228 224

operations. These institutes also leverage research through international and national consortia, alliances and

joint industry programmes. A list of the Company’s principal research and development institutes is set forth

below:

Keshava Deva Malaviya Institute of Petroleum Exploration, Dehra Dun, established in 1962, focuses

on exploration-related activities. The institute undertakes projects related to integrated basin analysis

and evaluation and generates improved concepts and models that help create new exploration and

production opportunities in petroliferous basins and breakthroughs in less explored and frontier basins.

Institute of Drilling Technology, Dehra Dun, established in 1978, focuses on drilling-related

technologies. Major functional areas of the Institute of Drilling Technology are drilling technology,

drilling fluid technology, cementing technology and completion fluid technology. In addition to research

and development, the institute also imparts training to its employees as well as participants from

domestic and overseas companies, through its Drilling Technology and Well Control Schools.

Institute of Reservoir Studies, Ahmedabad, established in 1978, is the centre for reservoir management

studies. The main functions of the Institute of Reservoir Studies are reservoir characterisation, simulation

and management, oil and gas field development, enhanced oil recovery and well productivity

enhancement.

Institute of Oil and Gas Production Technology, Mumbai, established in 1984, focuses on oil and gas

production and processing-related work. It provides technological solutions to enhance production and

improve the economics of operations. Production engineering, surface facilities and process engineering,

artificial lift engineering, corrosion and scale management and flow assurance and field development

are the major functional groups in the Institute of Oil and Gas Production Technology.

Institute of Engineering and Ocean Technology, Mumbai, established in 1983, is the centre for offshore

engineering. Its principal areas of work are risk analysis and conceptual engineering, structural

engineering, geotechnical engineering and materials and corrosion engineering.

Geodata Processing and Interpretation Centre, Dehra Dun, established in 1987, focuses on Seismic

Data processing, seismic and log data interpretation, software development and application of new

technologies for improved processing and interpretation.

Institute of Biotechnology and Geotectonic Studies, Jorhat, established in 1989, works in the areas of

geo-microbial petroleum prospecting, microbial enhanced oil recovery and soil bioremediation.

School of Maintenance Practices, Vadodara, was established on 23 November 2003 with the aim of

serving as a Single Window for comprehensive technical development of the Company’s maintenance

engineers.

Centre for Excellence in Well Logging, Vadodara.

ONGC Energy Centre Trust, Delhi, established in 2005, undertakes, promotes and manages projects for

improving and developing commercially viable energy mediums and sources including research in the

field of vertical integration of hydrocarbons and renewable sources of energy.

Training

The Company seeks to provide all of its employees, executives and staff with regular and periodic

training and development to help them acquire the knowledge and skills necessary for the Company’s activities.

Training initiatives are primarily conducted through the Company’s training institutes in India.

A39729228 225

ONGC Academy, Dehra Dun, established in 1982, is the nodal agency for training and development of

the Company’s human resources. The institute also provides training to other domestic and overseas

companies. The academy’s programmes include induction training, specialised functional training,

management training, computer training, a corporate strategic programme, an integrated professional

programme and an emerging technologies programme.

Institute of Petroleum Safety, Health and Environmental Management, Goa, established in 1989,

promotes standards of safety, occupational health and environmental management through training. Its

main functions are the provision of practical and theoretical training in the areas of safety, occupational

health, environmental management, petroleum safety-related risk studies and environment-related

consultancy.

Skill Development Centre (SDC) – Chennai, Mumbai, Sivasagar and Vadodara, established in 1983,

1985, 1963 and 2001 respectively, focuses on to developing technically competent human resource to

meet the challenges of the hydrocarbon sector and to cater to the training needs of officials and officers

up to middle management level. The key objectives of the SDCs include:

(a) empowering the employees with required skills and technical improvements to face the

challenges of the oil and gas industry in the competitive business environment;

(b) promoting the spirit of learning to align with the principals and objectives of the Company;

(c) developing and sustaining knowledge to achieve organisational goals and create a future-ready

workforce;

(d) ensuring the holistic development of employees through various learning and development

interventions; and

(e) providing induction and milestone linked training programmes to meet the needs of the work

centres.

Employees

The following tables set forth certain information with respect to the Company’s employees for the

periods indicated:

As of 31 March

Category 2017 2018 2019

Employed in onshore and offshore producing assets........ 11,434 10,948 10,513

Employed in exploration basins ....................................... 2,595 2,546 2,395

Employed in oil field services .......................................... 13,063 12,578 12,272

Employed in plants ........................................................... 1,820 1,747 1,700

Employed in research institutes ........................................ 2,846 2,692 2,520

Employed in various corporate functions ......................... 1,415 1,296 1,226

ONGC Videsh and deputation Out ................................... 487 458 439

Total ................................................................................. 33,660 32,265 31,065

As of 31 March 2017, 2018 and 2019, the Company employed 33,660, 32,265 and 31,065 permanent

employees, respectively.

A39729228 226

The Company’s employees are represented by 47 registered trade unions, of which the Company

recognises 12. All of the trade unions (including unrecognised trade unions) are affiliated with central trade

unions. The Company entered into a long-term settlement agreement pursuant to the Industrial Disputes Act,

1947 with all of the recognised trade unions that is binding on all unionised categories of employees by law.

The agreement is effective 1 January 2007 and is coterminous with the dates of pay revision of executives, but

not beyond ten years. The Company believes it enjoys good relations with its employees. There have been no

instances of labour unrest among the Company’s employees that have had a material adverse effect on the

Company’s operations.

Insurance

The Company, including its subsidiaries, maintains a range of insurance policies in relation to its

business and operations that it believes is customary for its industry, including, for example, insurance policies

that cover property damage to certain onshore properties, risks associated with the Company’s offshore and

international activities, and certain risks associated with the Company’s refinery, including loss of certain

property and machinery, as well as business interruption insurance. The Company believes that its insurance

coverage is appropriate for its business risks and consistent with customary practices for similarly situated

companies in its industry.

Health, Safety and Environment

The Company is committed to maintaining high standards of occupational health, safety and

environmental protection. Due to the nature of its operations, the Company conducts internal and external audits

to ensure compliance with health, safety and environmental protection norms, and to maintain effective waste

management practices. Established external national and international health, safety and environment agencies

also routinely conduct audits of the Company’s offshore and onshore installations.

The Company is subject to a wide range of rules and regulations including various environmental laws.

In addition, the Company also must comply with the Oil Industry Safety Directorate, an organisation under the

control of the MoPNG, which issues safety guidelines. The Company is also subject to the safety regulations

prescribed by the Directorate General of Mines and Safety. Each work centre has teams dedicated to health,

safety and environmental issues and executes the safety guidelines prescribed by the Oil Industry Safety

Directorate as well Directorate General of Mines and Safety. The Company’s health, safety and environment

teams are also responsible for obtaining necessary licences and clearances from the State Pollution Control

Boards and Ministry of Environment, Forest and Climate Change.

Corporate Social Responsibility (“CSR”)

The Company seeks to integrate its business values and operations in an ethical and transparent manner

to demonstrate its commitment to sustainable development, meet its social responsibilities, its environmental

and economic practices and create a positive impact on society. The Company on standalone basis has spent

Rs. 5,259.00 million, Rs. 5,034.35 million and Rs. 6,146.44 million for various CSR projects implemented in

accordance with the government guidelines, for the 2017 Fiscal Year, the 2018 Fiscal Year and the 2019 Fiscal

Year, respectively. The Company issued its eighth consecutive “sustainability report” (2016-2017), wherein it

reviewed its internal policies, vision, mission, strategy and performance management systems in order to

identify issues which would impact its sustainability performance. The Company also implemented a whistle

blower policy in December 2009 and a fraud prevention policy in October 2017. Further, the Company has

contributed towards environmental protection by engaging in tree planting and other afforestation initiatives.

The Company has also focused on the promotion of various sporting activities on a national and international

level.

A39729228 227

Intellectual Property

The Company relies on a combination of trademark, patents, copyrights and contractual provisions to

protect its intellectual property, including its brand identity. The Company have registered trademarks in India,

i.e. the Company’s name style in English, the Company’s logo and the Company’s name style in Hindi under

registration number 1503532, 1503601 and 1503525 respectively, which are valid until 5 February 2025. The

Company currently has filed a total 110 patents, out of which 35 patents have been granted on various

techniques, including “a process for enhanced recovery of crude oil from oil wells using novel multi-microbial

strain” in India, “a process for enhanced recovery of crude oil from oil wells using novel microbial consortium”

in the United States, “a process for preparing relative permeability modifier bio polymer gel for

blocking/limiting water production in oil sand” in India and “a process for the treatment of the oily effluent

produced by the petroleum upstream oil industries”. The remaining 75 filed patents are under consideration at

the intellectual property office of Indian Government. As of the date of this Offering Circular, the Company has

also filed 35 copyrights application (comprising 34 such applications in respect of its in-house developed

software and one further document) of which 31 filed copyrights have been registered and the remaining 4 filed

copyrights are under consideration at the copyright office of the Indian Government.

Properties

In addition to its crude oil and natural gas assets, the Company owns its corporate office and leases its

Registered Office. The Company’s subsidiaries currently own or lease a variety of properties, primarily for

office space, throughout India. The Company believes its properties are sufficient for it to conduct its business

in its present form.

Legal and Regulatory Proceedings

From time to time, the Company has been and may be involved in various disputes and proceedings.

The Company is currently a party to certain proceedings brought by various government authorities and private

parties. The Company and its subsidiaries are not involved in any litigation that may, individually or in the

aggregate, have a material effect on the financial position of the Company save for the RJ-ON-90/1 Block

Arbitration described below which the Company anticipates could be a potentially material proceeding.

Since 2019, the Company has been involved in an arbitration proceeding (the “RJ-ON-90/1 Block

Arbitration”) with Vedanta Ltd. and Cairn Energy Hydrocarbon Ltd. relating to various unresolved issues

including cost recovery in respect of exploration, development and production cost and cost recovery of royalty

in relation to the RJ-ON-90/1 Block (the “Disputed Block”). Pursuant to the applicable PSC (the “Disputed

Block PSC”) signed in 1995, the Company was the licensee of the Disputed Block and mining leases within

the Disputed Block were signed between the Company and the State of Rajasthan. The Company has been

paying Royalty on the entire production of crude oil and natural gas in accordance with the Disputed Block

PSC. Pursuant to Amendment No. 3 to the Disputed Block PSC (the “Third Amendment”) which took effect

from October 2012, the royalty paid by the Company was clarified to be cost recoverable as contact cost from

the inception of the Disputed Block PSC. The implementation of the Third Amendment meant that the Company

could recover royalty from revenue generated from the sale of crude/natural gas (through the relevant invoices

from Vedanta Ltd., as operator (the “Disputed Block Operator”), to the crude/natural gas consumers) on the

basis of entitlement interest (i.e. proportionate Participating Interest (“PI”) and the amount of royalty paid by

the Company on the other partner’s share of PI) (the “Entitlement Interest Arrangement”). The Entitlement

Interest Arrangement continued until 15 July 2017. On 16 July 2017, the Disputed Block Operator unilaterally

and without providing reasons discontinued the Entitlement Interest Arrangement and reverted back to the

arrangement prior to the implementation of the Third Amendment (i.e. the Company could only recover royalty

based on its PI and not entitlement interest). In 2019, Vedanta Ltd. and Cairn Energy Hydrocarbon Ltd.

commenced arbitration proceedings against the Company for a sum of U.S.$400 million and other reliefs

(including but not limited to monetary damages resulting from the Company’s alleged breaches with regard to

A39729228 228

cost recovery) regarding cost recovery. The Company has in turn raised a counter claim against Vedanta Ltd.

and Cairn Energy Hydrocarbon Ltd. of approximately U.S.$400 million in respect of the Company’s

unrecovered royalty paid on the production share of Vedanta Ltd. and Cairn Energy Hydrocarbon Ltd. The

constitution of the arbitration tribunal (the “Arbitral Tribunal”) was completed in July 2019. As at the date of

this Offering Circular, the Arbitral Tribunal is in the process of finalising its terms of engagement and the

arbitration hearing date has not been scheduled. In respect of the RJ-ON-90/1 Block Arbitration, as of 31 March

2019, the Company has recorded a sum of U.S.$261.21 million as contingent liabilities and approximately

U.S.$400.00 million as current liabilities.

As of 31 March 2019, the total amount of claims (including demands and claims by tax authorities and

private parties and legal and arbitration proceedings) against the Company on a consolidated basis which were

not provided for and considered by the Company as contingent liabilities was Rs. 694,791.71 million. Since

most of these cases are in trial or in processing, it is difficult to estimate a precise figure of the amounts of any

losses that the Company is likely to sustain as a result of such actions being decided against the Company. Even

if any judgment or award of such current pending litigation against the Company is decided adversely to the

Company, save for the RJ-ON-90/1 Block Arbitration described above, it does not anticipate that such cases

(individually or in the aggregate) would have a material adverse impact on its business, financial condition or

results of operations. See “Investment Considerations — Risks Relating to the Company’s Business — The

Company is involved in legal, regulatory and arbitration proceedings that, if determined against it, may have

an adverse impact on its business and financial condition”.

A39729228 229

MANAGEMENT

The Company’s Articles of Association require it to have not less than four and not more than 21

Directors. The Company as of 31 March 2019 has 17 Directors, of whom seven are full time Directors

(including the Chairman and Managing Director), two are Indian Government Nominee Directors and eight are

Independent Directors.

The following table sets out the details regarding the Company’s board of directors as of the date of this

Offering Circular.


Mr. Shashi Shanker

Designation: Chairman and Managing Director

Nationality: Indian ..............................................

58 ONGC Videsh Limited

Mangalore Refinery and Petrochemicals Limited


ONGC Tripura Power Company Limited

ONG Petro-additions Limited


Petronet LNG Limited

Mr. Rajesh Kumar Srivastava

Designation: Director (Exploration)


56

Mr. Subhash Kumar

Designation: Director (Finance)


57 Mangalore Refinery and Petrochemicals Limited

Hindustan Petroleum Corporation Limited

Petronet MHB Limited




Mr. Rajesh Kakkar

Designation: Director (Offshore)


58 ONGC Petro-additions Limited


Pawan Hans Limited

Mr. Sanjay Kumar Moitra

Designation: Director (Onshore)


59 Dahej SEZ Limited


Mr. N C Pandey

Designation: Director (Technology and Field

Services)


59 ONGC Tripura Power Company

North East Transmission Company Limited

Dr. Alka Mittal

Designation: Director (HR)


56 ONGC Mangalore Petrochemicals Limited

Mr. Rajiv Bansal

Designation: Indian Government

Nominee Director


55 Bharat Petroleum Corporation Limited

India Strategic Petroleum Reserves Limited

Bharat Yantra Nigam Limited

Mr. Amar Nath

Designation: Indian Government Nominee

Director


53 OIL India Limited

A39729228 230


Mr. Ajai Malhotra



65 ONGC Videsh Limited

Mr. K M Padmanabhan



62 Prerana Educational Media Private Limited

Rashtriya Ispat Nigam Limited

Prof. S B Kedare



55

SPPU Research Park Foundation(1)

Sulok Chetna Pratishthan(1)

Mr. Vivek Mallya



43 Mangalore Refinery and Petrochemicals Limited

Mr. Sumit Bose



65 Coromandel International Limited

HDFC Standard Life Insurance Company Limited

BSE Limited

Tata AIG General Insurance Company Limited

Foundation to Educate Girls Globally(1)

Jal Seva Charitable Foundation(1)

Vidhi Centre for Legal Policy(1)

Mr. Deepak Sethi



61 -

Dr. Santrupt Misra



53 Aditya Birla Capital Limited

Sarsan Enterprises Private Limited

Birla Carbon India Private Limited

Aditya Birla Management Corporation Private Limited

Birla Management Centre Services Limited

Asian Heart Institute and Research Centre Private

Limited

Ms. Ganga Murthy



65 -

Mr. Amitava Bhattacharyya



65 -

Note:

(1) A non-profit company under Section 8 of the Companies Act 2013.

None of the Directors is related to the others. There are no arrangements or understandings with major

shareholders, customers, suppliers or others pursuant to which any of the Directors were selected as Directors

or members of senior management.

A39729228 231

Details of Directors

Mr. Shashi Shanker has been the Chairman and Managing Director of the Company since 1 October

2017. Prior to his appointment as Chairman and Managing Director of the Company, Mr. Shanker was the

Director (Technology and Field Services) of the Company. Mr. Shanker is an industry veteran with over 30

years of experience in diverse E&P activities. He is a Petroleum Engineer from Indian School of Mines (ISM),

Dhanbad. He also holds a Master of Business Administration with specialisation in Finance from Indira Gandhi

National Open University. He has also received executive education from the prestigious Indian Institute of

Management, Lucknow and Indian School of Business, Hyderabad.

Mr. Rajesh Kumar Srivastava has been Director (Exploration) of the Company since 2 August 2019.

With over 35 years of experience, Mr. Srivastava has vast experience in up-stream hydrocarbon exploration

from well site operations, development geology, seismic data interpretation to monitoring and planning of

exploration. Mr. Srivastava joined the Company as geologist in 1984 at Krishna Godavari Basin, Rajahmundry.

During his tenure at Exploration and Drilling Directorate, he was closely involved with the exploration and

development activities of Assam and Assam-Arakan Basin, Mahanadi Bengal and Andaman Basin, Krishna-

Godavari Basin and Cauvery Basin. Mr. Srivastava has also evaluated several exploration and development

blocks of Egypt & Sudan. At the Institute of Reservoir Studies, Mr. Srivastava was considered as one of the

leading professionals in the trade of Reservoir Modelling for preparation of field development plans, simulation

studies for production forecasts and techno-economic evaluation of prospects. Mr. Srivastava is credited to have

introduced in the Company the art and science of geocellular modeling with “Neelam” being the first full field

fine scale geocellular model for dynamic modelling for redevelopment. Mr. Srivastava also played a key role

in the formulation of ‘Hydrocarbon vision-2030 for North East India’ which was driven by the MoPNG. In

recognition of his contributions towards the field development and hydrocarbon exploration, Mr. Srivastava

was awarded the National Mineral Award in 2009. Mr. Srivastava holds a Master of Science (Geology) from

Lucknow University and Master’s Degree in Engineering Geology from the Indian Institute of Technology,

Kanpur.

Mr. Subhash Kumar has been the Director (Finance) of the Company since 31 January 2018. Mr.

Kumar is a Fellow Member of ICAI and is also an Associate Member of ICSI. He is an alumni of Panjab

University, Chandigarh, where he obtained his Bachelor’s Degree and Master’s Degree in Commerce with Gold

Medal. Mr. Kumar joined the Company in 1985 as Finance and Accounts Officer. After initially working in

Jammu and Dehradun, he had a long stint at ONGC Videsh, the overseas arm of the Company. During his tenure

with ONGC Videsh, Mr. Kumar was associated with key acquisitions and the expansion of the Company's

footprint from single asset company in 2001 into a company with global presence in 17 countries with 37

assets. He played a key role in evaluation and acquisition of many Assets abroad by ONGC Videsh. Mr. Kumar

rejoined the Company as Chief Commercial and Head Treasury of the Company in July 2016 where he played

a key role in the evaluation, negotiation, and concluding outstanding issues pertaining to the organisation.

Mr. Rajesh Kakkar has been the Director (Offshore) of the Company since 19 February 2018. As

Director (Offshore), he will look after oil and gas production from the Company’s offshore fields that contribute

70 per cent. and 78 per cent. of the Company’s domestic crude oil and gas production respectively. Mr. Kakkar

has more than three and a half decades of experience in the various aspects of operations and management in

both offshore and onshore fields. He holds a Bachelor’s degree in Mechanical Engineering with Honours from

Ravi Shankar University, Raipur. He completed the Global Managers’ programme at IIM, Kolkata and

Leadership Development Program at IIM, Bangaluru. He was recognised as the “Young Executive of the Year”

in 1991 and also received the Chairman’s award in 1992 for “Consistent Performance in Offshore Production

Operations”. He has held key positions in various high-level committees and task forces concerning oil and gas

development projects and played a pivotal role in overseeing health, safety and environment maters as far as

the offshore operations are concerned.

A39729228 232

Mr. Sanjay Kumar Moitra has been the Director (Onshore) of the Company since 18 April 2018. As

Director (Onshore), he will look after oil and gas production from the Company’s onshore fields. He holds a

BE in Mechanical Engineering from Jabalpur University, India and has also completed an Advance

Management Course from Cambridge University, United Kingdom in 2011. With over 35 years of experience

in oil and gas production activities at various Indian basins, Mr. Moitra has conceptualised many ideas for

efficient resource management leading to implementation of a large number of complex and high-value projects

in India's oil and gas industry.

Mr. Navin Chandra Pandey has been the Director (Technical and Field Services) of the Company since

29 October 2018. He has over 36 years of experience in the oil and gas industry. Mr. Pandey is a Mechanical

Engineering graduate from Motilal Nehru Regional Engineering College, Allahabad (NIT, Allahabad). He held

various key positions in both offshore and onshore portfolio, handling challenging assignments in oil and gas

asset management, operations and services. With his excellent project execution skills, Mr. Pandey has a strong

track record in project delivery. He has a rich experience in offshore deep-waters and shallow waters as well as

onshore drilling. As Operations Manager of deep-water areas, he brought about significant performance

improvements in deep-water drilling operations. He is credited with successful management of floater drilling

rigs Sagar Bhushan and Sagar Vijay. He was conferred CMD’s ”Manager of the Year” award in 2007.

Dr. Alka Mittal has been the Director (HR) of the Company since 27 November 2018. Dr. Mittal is a

postgraduate in Economics, MBA (HRM) and Doctorate in Commerce and Business Studies. She joined the

Company as a Graduate Trainee in 1985 and brings with her an extremely rich experience spanning over three

decades. Dr. Mittal is the first woman to hold the charge of a full-time Director in the Company’s history. As a

senior HR specialist, Dr. Mittal has made rich contributions in various professional forums and bodies. She is

an Executive Committee member of NIPM (National Institute of Personnel Management) and heads the Women

Development Forum of the Company. As Director (HR) of the Company, Dr. Mittal is responsible, inter alia,

for implementing the HR policies of the Company.

Mr. Rajiv Bansal is an Indian Government Nominee Director and is the Additional Secretary and

Financial Adviser, Ministry of Petroleum and Natural Gas of the Indian Government. Mr. Bansal joined the

board on 10 August 2017. He was previously a member of the Ministry of Electronics and Information

Technology (MeitY), where he was responsible for Digital Payments, IT Act, Aadhaar, and Internet

Governance. During his career spanning almost 30 years, Mr. Bansal has worked as Secretary, Central

Electricity Regulatory Commission (CERC), Joint Secretary, Department of Heavy Industries, Indian

Government and Director and Ministry of Civil Aviation, Indian Government. He previously served on the

boards of BHEL, NACIL, AYCL, Alliance Air, HMT and GITA. He has also held important assignments in the

State Government. He is a Civil Engineer by profession having graduated from IIT, Delhi in 1986 and has a

Diploma in Finance from ICFAI, Hyderabad and an Executive Master’s in International Business from IIFT,

New Delhi.

Mr. Amar Nath is an Indian Government Nominee Director and is the Joint Secretary (Exploration),

Ministry of Petroleum and Natural Gas of the Indian Government. Mr. Nath joined the board on 28 June 2016

and was reappointed for the same role on 28 June 2019. Mr. Nath, an IAS Officer (1994 AGMUT Cadre), has

a Bachelor of Science (Mechanical Engineering) from the National Institute of Technology, Kurukshetra,

Kurukshetra University and an MA (International Development Policy) from Duke University, USA. He has

extensive experience of working in various Departments of the Indian Government in senior management

positions such as Finance, Economic Planning, Tourism and Industrial Development in the states of Arunachal

Pradesh, Pondicherry, Chandigarh and Delhi. Before joining IAS in 1994, he worked with State Bank of India

and Steel Authority of India.

Mr. Ajai Malhotra has been an Independent Director of the Company since 20 November 2015 and is

a Retd. Indian Foreign Service (IFS) (1977 Batch) Officer. Mr. Malhotra was Minister (Commerce) at the

A39729228 233

Embassy of India in Washington DC from 1999 to 2003, serving simultaneously from 2002 to 2003 as Chairman

of the International Cotton Advisory Committee. He was Ambassador of India to Romania, concurrently

accredited to Albania and Moldova from 2003 to 2005, Ambassador and Deputy Permanent Representative of

India to the United Nations in New York from 2005 to 2009, Ambassador of India to Kuwait from 2009 to 2011

and Ambassador of India to the Russian Federation from 2011 to 2013, before retiring from the IFS on 30

November 2013 after 37 years of distinguished service. His wide-ranging experience includes being on the

Indian team negotiating issues such as biological diversity, climate change, desertification, education, energy,

forestry, health, human rights, human settlements, intellectual property rights, international law, labour, ozone

depletion sustainable development and international trade. In 2004, he was awarded an Honorary Doctorate by

Western University of Arad, Romania, in recognition of his work in support of the environment and

development. A Distinguished Fellow at The Energy and Resources Institute (TERI), New Delhi, the Chairman

and Managing Trustee of two organisations serving the underprivileged, CHIKITSA and SHIKSHA, as well as

Chairman of the Nehru Trust for the Indian Collections at the Victoria and Albert Museum and Chairman of the

NAB India Centre for Blind Women and Disability Studies. He frequently contributes to seminars on economic,

environmental, defence, political, trade and security issues.

Mr. K M Padmanabhan has been an independent director since 20 November 2015 and is a Chartered

Accountant who has been in practice for more than 27 years. Mr. Padmanabhan is also the Senior Partner

of SRINIVAS and PADMANABHAN, Chartered Accountants, Chennai. As a practising Chartered Accountant,

he has created Internal Control Systems, processes and procedure, as well as providing business consultancy

for a very big South based educational institution covering engineering, medical and also into hospitals. He has

been a regular visiting lecturer in the area of Finance and Accounting at Indian Institute of Management

(Indore), Indian Institute of Management (Raipur), Institute for Financial Management and Research (IFMR),

RBI Staff Training College, Tamilnadu Judicial Academy and The Institute of Chartered Accountants of India

(ICAI). He has been trained in Case Method Teaching at Harvard Business School, Boston, USA and at Harvard

Business School Center, Shanghai, China. He is a founding member of Prerana Helpline Foundation (NGO),

which caters to the needs of visually challenged people.

Prof. Shireesh B Kedare has been an independent director of the Company since 20 November 2015.

Prof. Kedare obtained his B.Tech. in Mechanical Engineering from IIT Bombay in 1985. He also obtained his

Ph.D. in 1992 from IIT Bombay in “Reciprocating Wind Machine”. He spent three years (1992-95) as a

volunteer in the social sector working on different issues related to ‘Development’. He started his engineering

consultancy career in energy and environment in 1995. He worked as a Technical Consultant from 1998 to 2001

to the Chairman, Khadi and Village Industries Commission when he worked on the issues related to

Development of Rural Industries Clusters. He is presently associated with IIT Bombay as a Professor.

Mr. Vivek Mallya has been an independent director of the Company since 31 January 2017. Mr. Mallya

is a Fellow member of the Institute of Chartered Accountants of India, Certified Public Accountant (USA) and

a Master’s Degree Holder in Commerce from Mysore University. He has rich experience in the practice of

accounting as a Chartered Accountant. His practice areas include international taxation, income tax, foreign

exchange management acts and banking matters. He also holds the position of Honorary President of a leading

NGO in Bangalore. Prior to practising on his own, he was a partner with PwC, a ‘Big Four’ accounting firm

and was previously the AVP Finance at Thomson Reuters. At PwC, he also specialised in Aerospace and Defense

matters. He handled significantly large assignments, including dual-listed mergers, cross-border acquisitions

and restructuring, delisting and Asset Reconstruction.

Mr. Sumit Bose has been an independent director of the Company since 31 January 2017. Mr. Bose is

presently Vice Chairman, National Institute of Public Finance and Policy (NIPFP). He was the Union Finance

Secretary and Revenue Secretary in the Ministry of Finance, Indian Government until his retirement in March,

2014. Thereafter, he was a Member of the Expenditure Management Commission. Educated at the Doon School,

A39729228 234

Dehradun (Class of 1970), St. Stephen’s College, Delhi and the London School of Economics, he joined the

Indian Administrative Service in 1976.

Mr. Deepak Sethi has been an independent director of the Company since 31 January 2017. Mr. Sethi

is a Commerce Graduate and a Fellow member of the Institute of Chartered Accountants of India, with rich

experience spanning 32 years of practice in conducting statutory, tax and internal audits of companies,

partnership firms, proprietary concerns, schools, universities, hospitals, trusts and other entities. He has a vast

practice in direct and indirect taxation and has appeared before Appellate Tribunals of Service Tax, Sales Tax,

Income Tax etc. He also possesses experience of Statutory audit, inspection and revenue audits of Public Sector

Banks, loss assessment for insurance companies, bank financing for manufacturing trading and services

providers, financial advisory and consulting work for corporate and high networth individuals.

Dr Santrupt Misra has been an independent director of the Company since 6 February 2017. Dr. Misra

holds a Master’s in Political Science from Utkal University and Personnel Management from Tata Institute of

Social Sciences, he also possesses Doctorates in Public Administration from the Utkal University as well as in

Industrial Relations from Aston Business School, United Kingdom. He has over 28 years of professional

experience in global business, research and organisational development. He has associated with Aditya Birla

Group since 1996. He is the National President of the National HRD Network, a member of the Advisory Board

of Association of Executive Search Consultants (AESC) of the United States and was appointed as Member of

the SHRM Certification Commission in 2014 for a period of three years.

Ms. Ganga Murthy has been an independent director of the Company since 23 September 2019. Ms.

Murthy has an M Phil from the Department of Economics in the Madras University. She joined the Indian

Economic Service in 1976 and has over three decades of experience in planning, implementing, monitoring and

evaluating schemes and programmes across different sectors of the economy in the Indian Government. During

her career, she also obtained an MSc in National Development and Project Planning from the University of

Bradford, UK. She began her career in the Planning Commission with planning for the decentralised sector and

ways to address regional imbalances in the country. This was followed by stints of varying time periods in the

Departments / Ministries of Rural Development, Pensions, Economic Affairs, Chemicals and Petrochemicals,

Health and Family Welfare and Consumer Affairs. She superannuated from the Ministry of Consumer Affairs

in August 2013 as Principal Economic Adviser. She also acted as the Secretary for the Public Accounts

Committee and the Joint Parliamentary Committee to probe irregularities in Securities Transactions in 1992

during an interesting stint in the Lok Sabha from 1991 to 1993.

Mr. Amitava Bhattacharyya has been an independent director of the Company since 19 July 2019. He

was the Central Information Commissioner from 2016 to 2018 before retiring from civil services as the

Chairman of the Staff Selection Commission, Indian Government on 31 December 2015. Mr. Bhattacharyya

graduated in physics from the Presidency College, Kolkata and received a postgraduate degree from the

University of Delhi. Mr. Bhattacharyya then served in the National Physical Laboratory at the Council of

Scientific and Industrial Research, Indian Government, before joining the Indian Administrative Service in

1980. He subsequently completed a course in Human Resources and Public Administration from the Maxwell

School of Citizenship, Syracuse, the United States. He then served at the Government of Gujarat in various

capacities both in the field as well as in the Secretariat. He then served for approximately two years at the Union

Public Service Commission as Secretary. During his service, Mr. Bhattacharyya was responsible for the Internal

Finance Division of the Ministry of Labour, Indian Government and was acting as Chief Finance Officer and

Financial Advisor of the Employees Provident Fund (“EPF”). He was also on the Board of Employees’ State

Insurance Corporation (“ESIC”). In the early 90’s, he worked under the then Ministry of Environment and

Forest, Indian Government and was involved in several important issues of cross-country nature including

global warming, biodiversity protection and ozone depletion. He was also the Mission Director for Water

Conservation and Sanitation from 2006 to 2009. Mr. Bhattacharyya is associated with a non-governmental

A39729228 235

organisation on a voluntary basis working in the area of anti-trafficking of women and children in India and

other Southeast Asian countries.

Relationship between the Company’s Directors

None of the Company’s Directors is related to the others.

Directorships in Other Listed Companies

None of the Company’s Directors is or was a director in any listed company during the five years

preceding the date of this Offering Circular, whose shares have been or were suspended from being traded on

any stock exchange, during the term of their directorship in such company.

None of the Company’s Directors is or was a director in any listed company which has been or was

delisted from any stock exchange during the term of their directorship in such company.

Borrowing Powers of the Board of Directors

The Board of Directors has also passed a resolution on 19 January 2018 to borrow money not exceeding

Rs. 350,000.00 million.

Details of Appointment of the Company’s Directors

The Directors of the Company are appointed by shareholders who hold more than 50 per cent. of the

equity interest in the Company. Accordingly, all Directors of the Company are appointed with the consent of

the Indian Government. As per Article 96 of the Articles of Association, the Company’s directors are appointed

by the President of India. Except as stated above, none of the Company’s Directors has been appointed pursuant

to any arrangement or understanding with major shareholders, customers, suppliers or others.

Corporate Governance

As a PSU, the Company’s Directors are nominated and appointed by the Indian Government. The

Company is under the administrative control of the MoPNG. The Securities and Exchange Board of India

(Listing Obligations and Disclosure Requirements) Regulations 2015, as amended (the “Securities and

Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations 2015”) requires

companies to obtain prior approvals of their respective audit committees in relation to related party transactions

(except transactions between government companies and transactions between a holding company and its

wholly owned subsidiaries). The Company was not in compliance with the Securities and Exchange Board of

India (Listing Obligations and Disclosure Requirements) Regulations 2015, relating to the composition of its

board of directors from 1 April 2015 to 27 October 2017. During the 2015 Fiscal Year to the 2019 Fiscal Year,

the Company had informed but did not obtain the prior approval of its Audit Committee in respect of related

party transactions as required under the Companies Act 2013. Since 1 April 2019, the Company has however

put in place necessary systems and procedures to ensure compliance in respect of related party transactions as

required under the Companies Act 2013 and continues to make disclosures on related party transactions in its

annual reports. Other than as mentioned above, the Company has been in compliance in all respects with the

requirements of corporate governance contained in the listing agreement(s) (the “Listing Agreements”) with

the relevant Indian stock exchanges and the Securities and Exchange Board of India (Listing Obligations and

Disclosure Requirements) Regulations 2015, including those relating to the constitution of committees.

The Company has constituted an Audit Committee, a Stakeholders’ Relationship Committee, a Corporate

Social Responsibility Committee and a Nomination and Remuneration Committee as per the requirements of

the Listing Agreements and the relevant provision(s) of the Securities and Exchange Board of India (Listing

Obligations and Disclosure Requirements) Regulations 2015 and Companies Act 2013. The details of the

statutory committees of the Company are described below.

A39729228 236

Audit Committee

The Company’s Audit Committee was constituted through a Board resolution dated 28 May 1999 and

was last reconstituted on 14 February 2019. As of the date of this Offering Circular, the Committee comprised

the following members:

(i) Mr. K. M. Padmanabhan (Chairman);

(ii) Sumit Bose;

(iii) Vivek Mallya;

(iv) Deepak Sethi;

(v) Rajesh Kakkar; and

(vi) Sanjay Kumar Moitra.

Representatives of statutory auditors and cost auditors are invited to attend and participate in the meetings,

whenever required. Functional Directors, Executives of Finance and other departments are invited when

needed.

The terms of reference of the Audit Committee are in accordance with the Companies Act 2013,

guidelines on Corporate Governance issued by the Department of Public Enterprises (“DPE”), the Listing

Agreements and the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements)

Regulations 2015 and the administrative requirements of the Company as applied by the Board of Directors

from time to time and include, inter alia, the following:

(A) independent auditors:

(1) to recommend to the board payment of audit fees for statutory audit services;

(2) to approve assignments other than statutory audit to statutory auditors and also approve payment

of fees/charges for such services rendered by them;

(3) to review and monitor the auditor’s independence and performance, and effectiveness of audit

process;

(4) to review management letters / letters of internal control weaknesses issued by the statutory

auditors;

(5) to discuss with statutory auditors before the audit commences, the nature and scope of audit as

well as a post-audit discussion to ascertain any area of concern;

(6) to review with the independent auditors the co-ordination of audit efforts to assure completeness

of coverage, reduction of redundant efforts, and the effective use of all audit resources;

(7) to forward the observation/reply to auditors within 45 days of receipt of report, if any, received

on suspected fraud; and

(8) to consider and review the following with the independent auditor and management:

(a) the adequacy of internal controls, including computerised information system controls and

security, and

(b) related findings and recommendations of the independent auditor and internal auditor,

together with management’s responses;

A39729228 237

(B) internal auditors:

(1) to review the appointment or removal of the chief internal auditor;

(2) to review the adequacy of the internal audit function, including the structure of the internal audit

department, staffing and seniority of the official heading the department, reporting structure

coverage and frequency of internal audit;

(3) to review the internal audit reports relating to internal control weaknesses;

(4) to discuss with internal auditors any significant findings and follow-up thereto; and

(5) to review the findings of any internal investigations by the internal auditors or the findings of

statutory auditors and any other agency into matters where there is suspected fraud or irregularity

or a failure of internal control systems of a material nature and report the same to the board;

(C) Comptroller and Auditor General of India:

(1) to review the follow-up action on the audit observations of the Comptroller and Auditor General

of India t; and

(2) to review the follow-up action taken on the recommendations of the Committee on Public

Undertakings (COPU) of the Parliament;

(D) financial statements:

(1) to review, with management, the quarterly financial statements before submission to the board

for approval;

(2) certification/declaration of financial statements by the Chief Executive/Chief Finance Officer;

and

(3) to review, with management, the annual financial statements and auditor's report thereon before

submission to the board for approval, with particular reference to:

(a) matters required to be included in the director’s responsibility statement to be included in

the board’s report in terms of clause (c) of sub-section (3) of Section 134 of the Companies

Act 2013;

(b) changes, if any, in accounting policies and practices and reasons for the same;

(c) major accounting entries involving estimates based on the exercise of judgement by

management;

(d) significant adjustments made in the financial statements arising out of audit findings;

(e) compliance with listing and other legal requirements relating to financial statements;

(f) significant related party transactions and disclosure, if any;

(g) management discussion and analysis of financial condition and results of operations; and

(h) modified opinion(s) in the draft audit report;

(E) related party transactions:

(1) to review all related party transactions, subjected to Accounting Standard 18, entered/to be

entered by the company. For this purpose, the Audit Committee may designate a member who

shall be responsible for reviewing related party transactions;

A39729228 238

(2) to approve or any subsequently modify transactions of the company with related parties;

(3) to review, at least on a quarterly basis, the details of related party transactions entered into

pursuant to each omnibus approval;

(4) to review the periodical statement in summary form of transactions with related parties in the

normal and ordinary course of business;

(5) to review the details of material individual transactions with related parties, which are not in the

normal and ordinary course of business; and

(6) to review the details of material individual transactions with related parties or others, which are

not on an arm’s length basis, together with management’s justification for the same;

(F) utilisation of funds mobilised from public/shareholders:

(1) to review, with management, and monitor end use of funds raised through public offers and

related matters;

(2) to review the statement of deviation(s), if any, in the use of funds raised through public offers, on

a quarterly basis, before submission of the same to the stock exchanges;

(3) to review the annual statement of funds utilised for purposes other than those stated in the offer

document/prospectus/notice; and

(4) to review, with the management, the annual report issued by the monitoring agency, if any,

appointed to monitor the utilisation of proceeds of a public or rights issue, promptly upon its

receipt;

(G) other matters:

(1) to scrutinise inter-corporate loans and investments;

(2) to review the financial statements of subsidiaries and joint ventures, in particular the investments

made by the unlisted subsidiary and joint ventures;

(3) to ascertain the value of undertakings or assets of the company, wherever it is necessary;

(4) to evaluate internal financial controls and risk management systems and to review, with

management, the adequacy of the internal control systems;

(5) to review, with management, the performance of statutory and internal auditors;

(6) to look into the reasons for substantial defaults in the payment to depositors, debenture holders,

shareholders (in the case of non-payment of declared dividends) and creditors;

(7) consider and review the following with management, the internal auditor and the independent

auditor:

(a) significant findings during the year, including the status of previous audit

recommendations; and

(b) any difficulties encountered during audit work, including any restrictions on the scope of

activities or access to required information;

(8) to review the functioning of the whistle-blower mechanism;

A39729228 239

(9) to provide an open avenue of communication between the independent auditor, the internal

auditor and the Board of Directors;

(10) to review and recommend to the Board the Cost Audit Report including Annexures thereto,

Compliance Reports, Corporate Governance Report and Secretarial Audit Report;

(11) to review the utilisation of loans and/or advances to /investment by the Company in the subsidiary

and joint ventures exceeding rupees 100 crore or 10.00 per cent. of the asset size of the subsidiary,

whichever is lower including existing loans / advances / investments existing as on the date of

coming into force of this provision;

(12) to review and recommend to the Board loans and/or advances to Contractors/Vendors as may be

required from time to time; and

(13) to carry out any other function as may be assigned by the Board from time to time.

The Chairman of the Audit Committee shall be present at the Annual General Meeting to answer shareholder

queries; provided that in case the Chairman is unable to attend the AGM, he may nominate any member of the

Audit Committee for this purpose. The Audit Committee met nine times in the 2019 Fiscal Year.

Shareholders’/ Investors’ Grievance Committee

The Company’s Shareholders’/Investors’ Grievance Committee was constituted through Board resolution

dated 7 July 2001 and now renamed as the Stakeholders’ Relationship Committee with effect from 13 February

2014 and was last reconstituted on 14 February 2019. The Shareholders’/Investors’ Grievance Committee has

not met in the 2019 Fiscal Year. As of the date of this Offering Circular, the Stakeholders’ Relationship

Committee comprised the following members:

(i) Ms. Ganga Murthy (Chairperson);

(ii) Prof. S. B. Kedare;

(iii) Mr. Subhash Kumar;

(iv) Mr. Sanjay Kumar Moitra; and

(v) Dr. Alka Mittal.

The terms of reference of the Stakeholders’ Relationship Committee include, inter alia, the following:

looking into the redress of shareholders’ and investors’ complaints related to:

the transfer and transmission of shares, the issue of duplicate share certificates, and the

dematerialisation and rematerialisation of shares;

non-receipt of balance sheets, annual reports;

non-receipt of declared dividends;

any other relevant grievance that the investor/shareholder may have;

reviewing the performance of the registrar and share transfer agent;

monitoring investor services and recommending measures for overall improvement in the quality

of investor services; and

monitoring compliance with the Code of Conduct for the Prevention of Insider Trading in

securities.

A39729228 240

Nomination and Remuneration Committee

The Company set up a remuneration committee through a Board resolution dated 7 July 2001, which

was renamed the Nomination and Remuneration Committee through a Board resolution dated 14 November

2014. The Nomination and Remuneration Committee was last reconstituted on 14 February 2019. As of the

date of this Offering Circular, the Committee comprised the following members:

(i) Dr. Santrupt B. Misra (Chairman);

(ii) Mr. Shashi Shanker;

(iii) Mr. Rajiv Bansal;

(iv) Mr. K. M. Padmanabhan; and

(v) Ms. Ganga Murthy.

The terms of reference of the Remuneration Committee include, inter alia, the following:

recommending to the Board a policy relating to remuneration for the directors, key managerial

personnel and other employees involving a balance between fixed and incentive pay reflecting

short and long-term performance objectives appropriate to the working of the company and its

goals;

laying down the evaluation criteria for the performance of independent directors;

identifying persons who are qualified to become directors and who may be appointed to senior

management in accordance with the criteria laid down, and recommending to the Board their

appointment and removal;

carrying out an evaluation of every director’s performance;

formulating the criteria for determining the qualifications, positive attributes and independence of

a director;

deciding the Annual Bonus/Variable Pay Pool and Policy for its distribution across Executives and

Non-Unionised Supervisors, within the prescribed limits and as per the guidelines issued in this

regard by the Indian Government;

considering any other item which may be delegated in this regard by the Board of Directors; and

any other role assigned to the Committee as a result of changes/modifications in the Companies

Act 2013, Securities and Exchange Board of India and DPE Guidelines.

The Remuneration Committee met seven times in the 2019 Fiscal Year.

Corporate Social Responsibility Committee

The Corporate Social Responsibility Committee was reconstituted through a Board resolution dated 12

August 2013 and was last reconstituted on 14 February 2019. As of the date of this Offering Circular, the

Corporate Social Responsibility Committee comprised the following members:

(i) Mr. Ajai Malhotra (Chairman);

(ii) Dr. Santrupt B. Misra;

(iii) Mr. Subhash Kumar; and

(iv) Dr. Alka Mittal.

A39729228 241

The terms of reference of the Corporate Social Responsibility Committee (as specified under Section 135 of

the Companies Act 2013 and also pursuant to the administrative requirements of the Company as perceived by

the Board from time to time) include, inter alia, the following:

recommending the Company’s annual plan of corporate social responsibility activities and amount

of expenditure to be budgeted for such activities in line with the Company’s corporate social

responsibility policy;

monitoring the implementation of the Company’s corporate social responsibility policy and

recommending modifications, if required;

recommending to the Board the policy guidelines for ONGC CSR Foundation Trust and also

monitoring the ONGC CSR Foundation Trust’s activities from time to time;

recommending changes, if any, required in the trust deed of ONGC Foundation;

recommending the powers to be exercised at each level of executives with respect to the Company’s

corporate social responsibility activities pursuant to the Company's book of delegated powers;

approving the Company’s contributions to projects that are under Rs. 50 million and recommending

to the Board projects that involve contributions of over Rs. 50 million;

considering the Company’s sustainable development related projects and providing

recommendations to the Board; and

carrying out any other function as may be assigned by the Board from time to time.

The Corporate Social Responsibility Committee met seven times in the 2019 Fiscal Year.

Risk Management Committee

In compliance with the Indian laws on corporate governance, the Risk Management Committee was

constituted through a Board resolution dated 12 December 2014 and was last reconstituted on 14 February

2019. As of the date of this Offering Circular, the Risk Management Committee comprised the following

members:

(i) Mr. Deepak Sethi (Chairman);

(ii) Prof. S. B. Kedare;

(iii) Mr. Rajesh Kakkar;

(iv) Mr. Sanjay Kumar Moitra; and

(v) Mr. N. C. Pandey.

The terms of reference of the Risk Management Committee include, inter alia, the following:

ensuring compliance with the Company’s risk management policy;

reviewing and determining the adequacy and effectiveness of the Company’s business risk

management;

reviewing the Company’s risk portfolio against the Company’s risk framework and appetite;

defining the risk framework and appetite of the Company and advising business units and support

functions on risk initiatives;

reviewing and approving changes in the risk framework and appetite of the Company;

A39729228 242

making suggestions to improve the Company’s risk management techniques and lift management

awareness;

monitoring emerging issues and best practices of the Company;

monitoring the Company’s business risk reporting;

ensuring that the Company’s policies and standards on risk management are communicated across

the different levels of management in the Company;

evaluating risk related issues which may be delegated by the Board; and

performing any other role as may be assigned to it in line with changes in the Companies Act 2013,

Securities and Exchange Board of India and DPE Guidelines.

The Risk Management Committee met two times in the 2019 Fiscal Year.

Interest of the Company’s Directors

All of the Company’s Directors may be deemed to be interested to the extent of remuneration and fees

payable to them for services rendered as Directors on the Board of the Company such as attending meetings of

the Board or a committee thereof and to the extent of other reimbursement of expenses payable to them under

the Company’s Articles of Association.

A39729228 243

PRINCIPAL SHAREHOLDERS’ AND DIRECTORS’ INTERESTS IN

THE COMPANY

Principal Shareholders’ Interests

The following table details the principal shareholders of the Company as of 31 March 2019:

Shareholder

Per cent. of

ownership

President of India acting through the MoPNG. ........................................................................ 64.25

Life Insurance Corporation of India ......................................................................................... 9.48

Indian Oil Corporation Limited ................................................................................................ 7.85

Directors’ Interests

The following table details the shareholding of the Directors of the Company as of 31 March 2019:

Name of Directors

Number of

equity shares

Dr. Alka Mittal.......................................................................................................................... 10,428

Mr. Shashi Shanker .................................................................................................................. 5,568

Mr. Rajesh Kakkar .................................................................................................................... 4,758

Mr. Ajai Malhotra ..................................................................................................................... 1,650

Mr. A. K. Dwivedi .................................................................................................................... 1,230

Dr. Santrupt B. Misra ............................................................................................................... 630

Mr. N. C. Pandey ...................................................................................................................... 600

Ms. Ganga Murthy ................................................................................................................... 435

Mr. Subhash Kumar .................................................................................................................. 30

A39729228 244

RELATIONSHIP WITH THE INDIAN GOVERNMENT AND CERTAIN

RELATED PARTY TRANSACTIONS

Relationship with the Indian Government

To further the development of oil and natural gas exploration and mining in India, the Ministry of Natural

Resources and Scientific Research of the Indian Government set up the “Oil and Natural Gas Directorate” in

1955 which was then reorganised into the “Oil and Natural Gas Commission” in 1956 (the “Commission”). In

October 1959, the Commission was converted into a statutory body pursuant to the Oil and Natural Gas

Commission Act, 1959 (now repealed). The main functions of the Commission were to plan, promote, organise

and implement programmes for development of petroleum resources and the production and sale of petroleum

and petroleum products produced by it, and to perform such other functions as the Indian Government may,

from time to time, assign to it.

The Company was incorporated under the Companies Act on 23 June 1993 as Oil and Natural Gas

Corporation Limited and was granted the certificate of commencement of business on 10 August 1993. Pursuant

to the Oil and Natural Gas Commission Act (Transfer of Undertaking and Repeal) Act, 1993, the undertakings

of the Commission together with all its assets, movable and immovable properties, contracts, licenses and

privileges and liabilities and obligations in relation to its undertakings stood vested in the Company and were

transferred to the Company on 1 February 1994. The President of India acting through the MoPNG is the

Promoter of the Company with a shareholding as of 31 March 2019 of 64.25 per cent.

Related Party Transactions

Transactions between the Company, any of its subsidiaries and any of its related parties constitute related

party transactions. The key related party transactions of the Company include:

purchase of products from related parties;

sale of products to related parties;

services received from related parties;

services provided to related parties;

dividend income received from related parties;

advance paid to related parties against acquisition of equity shares during the year;

advance paid to related parties against acquisition of equity shares pending allotment (closing balance);

amounts receivables from related parties; and

amounts payable to related parties.

The Company believes that each of the transactions as described below has been entered into on arm’s

length terms or on terms that it believes are at least as favourable to it as similar transactions with non-related

parties.

Purchase of products from related parties

In the 2017 Fiscal Year, the 2018 Fiscal Year and the 2019 Fiscal Year, the Company purchased petroleum

products amounting to Rs. 231,011.80 million, Rs. 244,432.60 million and Rs. 412,624.90 million, respectively,

from its jointly controlled entity in India, HPCL-Mittal Energy Ltd. (“HMEL”).

A39729228 245

In the 2017 Fiscal Year, the 2018 Fiscal Year and the 2019 Fiscal Year, the Company purchased petroleum

products amounting to Rs. 1,153.40 million, Rs. 716.20 million and Rs. 624.30 million, respectively, from its

jointly controlled entity in India, Hindustan Colas Pvt. Ltd.

In the 2018 Fiscal Year, the Company purchased contaminated products amounting to Rs. 0.62 million

from its jointly controlled entity in India, Shell MRPL Aviation Fuels and Services Ltd. (“Shell MRPL”).

Sale of products to related parties

In the 2017 Fiscal Year, the 2018 Fiscal Year and the 2019 Fiscal Year, the Company sold natural gas

amounting to Rs. 5,389.99 million, Rs. 5,486.38 million and Rs. 6,481.80 million, respectively, to its jointly

controlled entity in India, OTPC.

In the 2017 Fiscal Year, the 2018 Fiscal Year and the 2019 Fiscal Year, the Company sold naptha and C2-

C3 products amounting to Rs. 16,055.62 million, Rs. 36,599.87 million and Rs. 52,459.88 million, respectively,

to its jointly controlled entity in India, OPaL.

In the 2017 Fiscal Year, the 2018 Fiscal Year and the 2019 Fiscal Year, the Company sold petroleum

products amounting to Rs. 4,720.78 million, Rs. 4,749.18 million and Rs. 6,434.29 million, respectively, to its

jointly controlled entity in India, Shell MRPL.

In the 2017 Fiscal Year, the 2018 Fiscal Year and the 2019 Fiscal Year, the Company sold petroleum products

amounting to Rs. 866.10 million, Rs. 597.90 million and Rs. 1,128.00 million, respectively, to its jointly

controlled entity in India, HMEL.


products amounting to Rs. 3,324.80 million, Rs. 3,243.70 million and Rs. 4,145.80 million, respectively, to its

jointly controlled entity in India, Hindustan Colas Pvt. Ltd.


products amounting to Rs. 1.70 million, Rs. 0.90million and Rs. 2.60 million, respectively, to its jointly

controlled entity in India, South Asia LPG Company Pvt. Ltd.

Services received from related parties

In the 2017 Fiscal Year, the Company received services amounting to Rs. 191.57 million from ONGC Teri

Biotech Limited, for bio-remediation services; Rs. 8.71 million from DSEZL as rent on special economic zone

land leased by the Company; Rs. 989.57 million from MSEZL, for supplies and services received, along with

rent on land leased by the Company; Rs. 156.00 million from HMEL for other services; Rs. 23.60 million from

Hindustan Colas Pvt. Ltd. for other services; and Rs. 1,251.20 million from South Asia LPG Company Pvt. Ltd.

for other services.

In the 2018 Fiscal Year, the Company received services amounting to Rs. 127.60 million from OTBL, for

bio-remediation services; Rs. 13.67 million from DSEZL as rent on special economic zone land leased by the

Company; Rs. 963.91 million from MSEZL, for supplies and services received, along with rent on land leased

by the Company; Rs. 122.50 million from HMEL for other services; Rs. 11.60 million from Hindustan Colas

Pvt. Ltd. for other services; and Rs. 1,201.90 million from South Asia LPG Company Pvt. Ltd. for other

services.

In the 2019 Fiscal Year, the Company received services amounting to Rs. 192.68 million from OTBL, for

bio-remediation services; Rs. 0.17 million from OTPC for training; Rs. 16.15 million from OPaL for

reimbursement of expenditure; Rs. 12.78 million from DSEZL as rent on special economic zone land leased by

the Company; Rs. 1,031.61 million from MSEZL, for supplies and services received, along with rent on land

leased by the Company; Rs. 179.80 million from HMEL for other services; Rs. 113.50 million from Hindustan

A39729228 246

Colas Pvt. Ltd. for other services; and Rs. 837.60 million from South Asia LPG Company Pvt. Ltd. for other

services.

Services provided to related parties

In the 2017 Fiscal Year, the Company provided services amounting to Rs. 374.54 million to OPaL, for

manpower deputation, loading and other charges; Rs. 3.94 million to OTBL, for field study charges and rent

for colony accommodation; Rs. 1.1 million to ONGC Tripura, for management consultancy services and

interest; Rs. 0.03 million to MSEZL for reimbursement of other expenditure; Rs. 10.78 million to Shell MPRL

for reimbursement of electrical charges and royalty income; Rs. 158.70 million to HMEL for manpower supply

services, rent and other services; Rs. 52.80 million to Hindustan Colas Pvt. Ltd. for manpower supply services,

rent and other services; and Rs. 26.60 million to South Asia LPG Company Pvt. Ltd. for rent and other services.


manpower deputation, loading and other charges; Rs. 0.19 million to OTBL, for field study charges and rent

for colony accommodation; Rs. 0.12 million to OTPC, for management consultancy services and interest; Rs.

0.09 million to MSEZL for reimbursement of other expenditure; Rs. 9.23 million to Shell MPRL for

reimbursement of electrical charges and royalty income; Rs. 198.10 million to HMEL for manpower supply

services, rent and other services; Rs. 60.20 million to Hindustan Colas Pvt. Ltd. for manpower supply services,

rent and other services; and Rs. 22.30 million to South Asia LPG Company Pvt. Ltd. for rent and other services.


manpower deputation, loading and other charges and Rs. 1.36 million for ROU charges for pipeline Rs. 0.42

million to OTBL, for field study charges and rent for colony accommodation; Rs. 0.10 million to OTPC, for

management consultancy services and interest; Rs. 9.75 million to Shell MPRL for reimbursement of electrical

charges and royalty income; Rs. 239.60 million to HMEL for manpower supply services, rent and other services;

Rs. 96.60 million to Hindustan Colas Pvt. Ltd. for manpower supply services, rent and other services; Rs. 20.80

million to South Asia LPG Company Pvt. Ltd. for rent and other services; Rs. 4.60 million to HPCL Shapoorji

Energy Pvt Limited for Manpower supply; and Rs. 0.77 million for manpower deputation to IGGL.

Dividend income received from related parties

In the 2017 Fiscal Year, the Company received dividend income of Rs. 7.50 million from Shell MRPL;

Rs. 165.40 million from Hindustan Colas Pvt. Ltd; Rs. 325 million from South Asia LPG Company Pvt. Ltd.;

and Rs. 36.80 million from Petronet India Ltd.

In the 2018 Fiscal Year, the Company received dividend income of Rs. 700 million from OTPC; Rs. 112.50

million from Shell MRPL; Rs. 472.50 million from Hindustan Colas Pvt. Ltd; Rs. 725.00 million from South

Asia LPG Company Pvt. Ltd.; and Rs. 7.20 million from Petronet India Ltd.

In the 2019 Fiscal Year, the Company received dividend income of Rs. 672.00 million from OTPC; Rs.

80.59 million from DSEZL; Rs. 21.00 million from Shell MRPL; Rs. 236.30 million from Hindustan Colas Pvt.

Ltd; Rs. 450.00 million from South Asia LPG Company Pvt. Ltd.; and Rs. 499.70 million from HMEL.

Additional Investments

In the 2017 Fiscal Year, the Company made an additional investment in equity shares of Mozambique

LNGI Co. Pte Ltd. amounting to Rs. 16.66 million.

In the 2017 Fiscal Year, the 2018 Fiscal Year and the 2019 Fiscal Year, the Company made an additional

investment in equity shares of HPCL Shapoorji Energy Pvt. Ltd. amounting to Rs. 15.00 million, Rs. 70.00

million and Rs. 40.00 million, respectively.

In the 2019 Fiscal Year, the Company made an investment in equity shares of IGGL amounting to Rs.

50.00 million and a subscription of share warrants amounting to Rs. 6201.00 million in OPaL.

A39729228 247

Commitments Given

In the 2017 Fiscal Year, the Company made commitments to OPaL for the subscription of share warrants

in the amount of Rs. 480.5 million.

In the 2017 Fiscal Year, the Company made commitments to OPaL for backstopping support for

compulsory convertible debentures in the amount of Rs. 56,150.00 million on which interest accrued is the

amount of Rs. 3,612.06 million.

In the 2018 Fiscal Year, the Company made an additional commitment to OPaL for backstopping support

for compulsory convertible debentures in the amount of Rs. 21,630.00 million on which interest accrued is the


In the 2019 Fiscal Year, the Company continued the cumulative commitments to OPaL for backstopping support

for compulsory convertible debentures in the amount of Rs. 77,780 million on which interest accrued is the


In the 2019 Fiscal Year, the Company provided a letter of comfort to OPaL in respect of a term loan of

Rs. 65,000.00 million and in respect of a non-convertible debenture of Rs. 8,200.00 million.

Advance paid to related parties against acquisition of equity shares pending allotment (closing balance)

In the 2019 Fiscal Year, the Company subscribed to an additional 636,000,000 share warrants of OPaL,

entitling the Company to exchange each warrant with an equity share of face value of ₹10 per share each after

a balance payment of ₹0.25 for each share within 36 months issued on 12 December 2018. During the 2016

Fiscal Year and 2017 Fiscal Year, the Company had subscribed to 1,922,000,000 share warrants of OPaL,

entitling the Company to exchange each warrant with equity share of face value of ₹10 per share each after a

balance payment of ₹0.25 per equity share within 48 months of subscription of the share warrants issued on 25

August 2015.

Amounts receivables from related parties

In the 2017 Fiscal Year, Rs. 3,658.13 million was due from OPaL as trade and other receivables; Rs. 263.3

million was due from OTPC for trade and other receivables; Rs. 0.01 million was due from OTBL for trade and

other receivables; Rs. 510.17 million was due from Shell MRPL for trade and other receivables; Rs. 292.89

million was due from ONGC Mittal Energy Limited for other receivables; Rs. 82.80 million was due form

HMEL for trade and other receivables; Rs. 108.20 million was due from Hindustan Colas Pvt. Ltd. for trade

and other receivables; and Rs. 1.20 million was due from South Asia LPG Company Pvt. Ltd. for trade and

other receivables.

In the 2018 Fiscal Year, Rs. 7,412.62 million was due from OPaL as trade and other receivables; Rs.

258.98 million was due from OTPC for trade and other receivables; Rs. 0.01 million was due from OTBL for

trade and other receivables; Rs. 426.41 million was due from Shell MRPL for trade and other receivables; Rs.

293.20 million was due from ONGC Mittal Energy Limited for other receivables; Rs. 99.00 million was due

form HMEL for trade and other receivables; Rs. 60.20 million was due from Hindustan Colas Pvt. Ltd. for trade

and other receivables; and Rs. 2.10 million was due from South Asia LPG Company Pvt. Ltd. for trade and

other receivables.

In the 2019 Fiscal Year, Rs. 2,225.99 million was due from OPaL as trade and other receivables; Rs.

348.09 million was due from OTPC for trade and other receivables; Rs. 0.01 million was due from OTBL for

trade and other receivables; Rs. 496.31 million was due from Shell MRPL for trade and other receivables; Rs.

109.30 million was due from HMEL for trade and other receivables; Rs. 0.50 million was due from South Asia

LPG Company Pvt. Ltd. for trade and other receivables; Rs. 1.10 million was due from HPCL Shapporji Energy

A39729228 248

Pvt Limited for trade and other receivables and Rs. 0.83 million was due from IGGL for trade and other

receivables.

Amounts payable to related parties

In the 2017 Fiscal Year, Rs. 96.51 million was due to OTBL as trade payables; Rs. 7.8 million was due to

DSEZL as trade payables; Rs. 65.16 million was due to MSEZL as trade payables; Rs. 13,212.50 million was

due to HMEL as trade payables; Rs. 257.40 million was due to Hindustan Colas Pvt. Ltd. as trade payables;

and Rs. 139.40 million was due to South Asia LPG Company Pvt. Ltd. as trade payables.

In the 2018 Fiscal Year, Rs. 39.61 million was due to OTBL as trade payables; Rs. 233.47 million was due

to MSEZL as trade payables; Rs. 19,974.60 million was due to HMEL as trade payables; Rs. 195.10 million

was due to Hindustan Colas Pvt. Ltd. as trade payables; and Rs. 95.80 million was due to South Asia LPG

Company Pvt. Ltd. as trade payables.

In the 2019 Fiscal Year, Rs. 70.88 million was due to OTBL as trade payables; Rs. 11.30 million was due

to DESZL as trade payables; Rs. 0.14 million was due to OTPC as trade payables; Rs. 16.15 million was due

to OPaL as trade payables; Rs. 170.25 million was due to MSEZL as trade payables; Rs. 24,038.70 million was

due to HMEL as trade payables; Rs. 271.10 million was due to Hindustan Colas Pvt. Ltd. as trade payables;

and Rs. 117.80 million was due to South Asia LPG Company Pvt. Ltd. as trade payables.

A39729228 249

SUMMARY OF RELEVANT INDIAN LAWS AND REGULATIONS

This section provides a brief overview of the regulatory framework governing activities in the petroleum and

natural gas industry in India prescribed by the Indian Government and various state governments, which are

applicable to the Company and ONGC Videsh. The information provided below has been obtained from sources

available in the public domain. The regulations set out below may not be exhaustive and are only intended to

provide general information to potential investors and are neither designed nor intended to be a substitute for

professional legal advice.

The statements below are based on the current provisions of Indian law, and the judicial and administrative

interpretations thereof, which are subject to change or modification by subsequent legislative, regulatory,

administrative or judicial decisions.

Investors should carefully consider the information described below, together with the other information set out

in the other sections of this Offering Circular, including the financial statements, before making an investment

decision relating to the Notes, as any changes in the regulations and policies could have a material adverse

effect on the Issuers’ and the Company's business.

Oil and Gas Refining and Petrochemicals

Under Article 297 of the Constitution of India, the Union of India has jurisdiction over petroleum and

natural gas in India, with the MoPNG as the principal regulator of exploration and production of oil and natural

gas. The MoPNG issues guidelines related to petroleum and natural gas which include exploration and

production, refining, marketing, import and export and conservation of and transportation of oil and gas, and

petroleum products. The MoPNG established the Directorate General of Hydrocarbons (“DGH”) in 1993,

whose main functions include, in respect of discovered fields, ensuring optimum exploitation, reviewing and

approving development plans, work programmes, budgets, and reservoir evaluations and advising on mid-

course corrections and, in respect of the exploration blocks, appraising work programmes and monitoring

exploration activities. The MoPNG also controls the Oil Industry Safety Directorate, which develops standards

for safety and conducts periodic safety audits of all petroleum-handling facilities, the Petroleum Conservation

Research Association, which promotes awareness of energy conservation and efficiency in the use and

application of energy, and the Oil Industry Development Board, which provides financial and other assistance

for the development of the oil industry. The Oil Industry Safety Directorate prescribes safety standards that

apply to oil companies. Oil companies must also comply with safety regulations prescribed by the Director

General of Mines and Safety in respect of onshore petroleum mining installations.

Oil and gas exploration, production and refining activities in India are subject to extensive government

regulations which govern the exploration for oil and gas reserves, determining the viability of undertaking

commercial extraction of oil and gas resources and refining crude oil (including the marketing of oil and gas

produced from the source to the relevant downstream purchasers). Natural gas prices in India are regulated by

the MoPNG from time to time.

Pricing and Sale of Oil and Natural Gas

Prior to 1998, prices of all major petroleum products were fixed pursuant to the APM, which was based

on a “cost plus” pricing system under which companies engaging in E&P, refining and marketing were

guaranteed fixed returns on their net worth plus a reimbursement which covers eligible operating costs. In 1998,

APM was replaced by the market-determined pricing mechanism coupled with the rationalisation of customs

tariffs and excise duty rates.

Further to a notification by the Indian Government on 6 March 2007, directions were issued to charge

uniform pool prices on the supply of re-gassified liquefied natural gas to all customers under all long-term

contracts on a non-discriminatory basis. Furthermore, the Essential Commodities Act, 1955 empowers the

A39729228 250

Indian Government to issue notifications to control production, supply and distribution of certain essential

commodities, which also include petroleum and petroleum products.

In order to grant more freedom to contractors to price and allocate gas produced from a cluster/ field/

discovery on an arms’ length basis, the MoPNG on 2 September 2015 passed the Marginal Field Policy. As per

this policy, the share of the Indian Government revenue would be calculated as per the domestic natural gas

pricing guidelines as prevalent, at the given point of time.

Since 1 June 2010, the MoPNG has fixed the price of administered pricing mechanism natural gas

produced by national oil companies, including the Company, at U.S.$4.2 per MMbtu less royalty on a net

calorific value basis. For customers in North-East India, the net consumer price is fixed at 60.0 per cent. of the

above price (U.S.$2.52per MMbtu) as provided under an MoPNG order providing for a subsidy to customers

in North-East India. According to the MoPNG order, the difference between the administered pricing

mechanism gas price in India (excluding North-East India) and the price paid by customers in North-East India

is reimbursed to the Company from the Indian Government’s budget.

On 25 October 2014, the Indian Government announced the “New Domestic Natural Gas Pricing

Guidelines, 2014” (“New Gas Pricing Policy”). Under these guidelines, domestic gas price is determined based

on a weighted average formula, including the (a) annual average prices prevailing at Henry Hub, Alberta Hub,

National Balancing Point and Russia; and (b) annual volume of natural gas consumed in the U.S., Mexico,

Canada, the E.U. and former Soviet Union countries, excluding Russia, and Russia. These Guidelines were

made effective from 1 November 2014. Domestic gas price is determined in advance on a biannual basis, using

trailing data of price formula for four quarter data with a lag of one quarter. In terms of the said notification,

the Indian Government has notified the domestic natural gas price ceiling of U.S.$3.69 per MMbtu (on gross

calorific value basis) applicable for the period from 1 April 2019 to 30 September 2019.

For natural gas produced from blocks acquired under the pre-NELP regime, the price is fixed on a case-

by-case basis, or, in certain instances, pursuant to the terms of the relevant contractual arrangements. Pricing of

natural gas produced from small or isolated fields from the nomination blocks of National oil companies

(“NOCs”) will continue to be governed by prior guidelines issued on 8 July 2013.

On 21 March 2016, the MoPNG announced its guidelines on marketing, including pricing freedom

(subject to a ceiling price on the basis of landed price of alternative fuels), for the gas to be produced from

discoveries made in deep-water, ultra deep-water and high pressure / high temperature areas. Pursuant to these

guidelines, producers are allowed marketing and pricing freedom for all discoveries in such areas, which

commenced operations after 1 January 2016. Pricing freedom is subject to a ceiling calculated on the basis of

landed prices of alternative fuels. The guidelines further set out the calculation of such ceiling, which will be

recalculated every six months applying prospectively.

Exploration and Production Policy in India

New Exploration Licensing Policy (“NELP”)

Prior to the introduction of NELP, the issue of licences and production sharing contracts (“PSC”) was

regulated by the Oilfields Act (as defined below) and the P&NG Rules (as defined below), and exploration

blocks were offered for exploration and production only to NOCs.

NELP was formulated by the Indian Government in 1997 to provide a level playing field where

prospective contractors in both the public and private sectors could compete on equal terms for the award of

exploration and mining acreage. The NELP notification in 1999 specified that there would be no mandatory

state participation through NOCs and NOCs could no longer obtain petroleum exploration licences (“PEL(s)”)

on a “nomination” basis and would need to compete for PELs. Under NELP, the “carried interest” or “inherent

interest” concept whereby NOCs carried a 30 per cent. interest that was exercisable by them on discovery of

A39729228 251

oil or gas in exploration operations has been removed. Further, preferential treatment of NOCs and reservation

of blocks is no longer practiced. NELP provides that companies, including the NOCs, are to be paid international

prices for oil discoveries made in blocks offered under NELP.

The model production sharing contract (the “Model PSC”) was notified in terms of NELP, to be

regulated under the Petroleum and Natural Gas Rules ,1959 (“PNG Rules”), between the Indian Government

and a licensee or lessee with respect to the grant of a PEL or PML. The Model PSC is an agreement between

the Indian Government and a licensee or lessee (in each case, a “Contractor”) with respect to the grant of a

PEL or petroleum mining licences (“PMLs”). Under the Model PSC, the Contractor bears exploration risks and

development and production costs in return for a stipulated share of the production. The Indian Government’s

share in a PSC is also subject to competitive bidding between prospective Contractors. The Model PSC defines

participating interest of contracting parties and designates an operator for the contract area under the PEL or

PML. Where the Contractor under the PSC includes more than one company or entity, such entities inter se are

required to enter into a joint operating agreement. The contract period under the PSC includes (i) an exploratory

phase which could be further split into two sub-phases, during which the Contractor operates under a PEL, and

(ii) a development and production phase, during which the Contractor operates under a PML.

In addition, the PSC requires the Contractor to obtain Indian Government approval for (i) an appraisal

programme appraising any discovery, delineating petroleum reservoirs to which the discovery relates in terms

of thickness and lateral extent and determining the quantity of recoverable petroleum therein, (ii) a development

plan with respect to development of each commercial discovery, (iii) an annual work programme for the contract

period, (iv) a minimum work programme with respect to each exploration phase, and (v) any abandonment or

site restoration plans. A Contractor signing a PSC is free to market oil and gas it produces in the domestic

market and has the option to amortise exploration and drilling expenditures over a period of 10 years from the

first commercial production.

Other benefits under NELP include: (i) an income tax holiday for seven years from the commencement

of commercial production; (ii) exemptions from, among other things, payment of signature, discovery or

production bonus; (iii) exemption from the payment of import duty on goods imported for petroleum operations;

(iv) a minimised expenditure commitment during the exploration period; (v) no mandatory state

participation/carried interest by or for NOCs; and (vi) exemption from OID cess.

Other features as set out in the Model PSC include: (i) a defined procedure for the announcement of

hydrocarbon discoveries; (ii) a requirement to prepare appraisal programmes of commercial discoveries made

under nomination blocks, as well as a development plan of such discoveries, in consultation with the DGH

within the specified period; (iii) a cost recovery mechanism in favour of the operator and a profit-sharing

mechanism in favour of the Indian Government. These mechanisms are distinguishable from the existing

contracts applicable to coal/lignite bed methane blocks where there is no cost recovery mechanism for the

operator, and payment to the Indian Government is production-linked; and (iv) a dispute resolution mechanism

which applies the Arbitration and Conciliation Act, 1996 that is based on the United Nations Commission on

International Trade Law model.

The MoPNG has notified a policy framework for streamlining the working of PSC in respect of NELP

blocks on 14 August 2018. According to this policy, the exploration period and appraisal period granted to

Contractors in the North East of India under PSC may be extended up to a maximum of two years and one year

respectively. Subject to certain conditions, marketing freedom (including pricing freedom) in respect of, among

other things, future and/or existing discoveries may be granted to Contractors awarded PSCs in the North East

of India. Additionally, the time limit for serving notice of occurrence of force majeure to the DGH in respect of

NELP PSC has been extended from seven days to 15 days. Subsequently, the Hydrocarbon Exploration

Licensing Policy was introduced in 2016 to address various oil industry concerns in NELP.

A39729228 252

Hydrocarbon Exploration and Licensing Policy (“HELP”)

Currently, oil and gas constitutes a major and increasing share of total imports. To stimulate domestic

production, the Indian Government has enunciated a new policy regime for exploration licensing. The Indian

Government has proposed a new regime in support of its “Ease of Doing Business” policy. Since 2014, the

Indian Government has launched regulatory reforms aimed at making it easier to do business in India. In a press

note dated 10 March 2016, it was provided that the Indian Government shall receive a share of the gross revenue

from the sale of oil and gas, among other items, and will not be concerned with the cost incurred. In pursuance

of the aforesaid objective, the Indian Government through a notification dated 30 March 2016 approved a new

exploration and licensing policy named as HELP. Under the Indian Government policy, HELP replaces NELP

for prospective award of PEL and PML blocks.

Pursuant to HELP, a graded system of royalty rates has been introduced, in which royalty rates for ultra

deep-water areas will be lower than deep-water waters which will be lower than shallow water areas. At the

same time, royalty rates for onshore areas will not change in order that revenues for the relevant state

governments are not affected. Recognising the higher risks and costs involved in exploration and production

from offshore areas, lower royalty rates for such areas have been proposed as compared to NELP royalty rates

to encourage exploration and production in offshore areas. The implementation of HELP will increase domestic

oil and gas production, bring substantial investment in the sector and generate sizeable employment

opportunities. The policy is also aimed at enhancing transparency and reducing administrative discretion.

In addition, the uniform licence proposed under HELP will enable the Contractor to explore conventional

as well as unconventional oil and gas resources including coal bed methane, shale gas or shale oil, tight gas and

gas hydrates under a single licence.

The four main facets of HELP are:

(i) a uniform licence for exploration and production of all forms of hydrocarbons, including oil, gas, coal

bed and methane under a single licence and policy framework;

(ii) an open acreage policy – a policy which enables E&P companies to choose the blocks from the

designated area. Under this policy, a bidder may apply to the Indian Government seeking exploration of

any block not already covered by exploration. The Indian Government will examine the expression of

interest and justification. If it is suitable for an award, the Indian Government will call for competitive

bids after obtaining necessary environmental and other clearances. This will enable a faster coverage of

the available geographical area;

(iii) an easy to administer revenue sharing model where the present fiscal system of production sharing based

on investment multiple and cost recovery/production linked payment will be replaced by an easy to

administer revenue sharing model. The earlier contracts were based on the concept of profit sharing

where profits are shared between the Indian Government and the Contractor after recovery of cost. Under

the profit sharing methodology, it became necessary for the Indian Government to scrutinise cost details

of private participants and this led to many delays and disputes; and

(iv) marketing and pricing freedom for the crude oil and natural gas produced in the domestic market on an

arm’s length basis.

To safeguard the Indian Government revenue, the Indian Government’s share of profit will be calculated

based on the higher of the prevailing international crude price and the actual price. Contracts will be based on

“biddable revenue sharing”, where the bidders will be required to quote revenue share in their bids and this will

be a key parameter for selecting the winning bid. The bidders will quote shares at two levels of revenue: “lower

revenue point” and “higher revenue point”. Revenue share for the intermediate points will be calculated by

using linear interpolation. The bidder that gives the highest net present value of intermediate revenue share to

A39729228 253

the Indian Government, calculated using linear interpolation, will be given the highest score under this

parameter.

The new policy regime marks a generational shift and modernisation of the oil and gas exploration

policy. It is expected to stimulate new exploration activity for oil, gas and other hydrocarbons and eventually

reduce import dependence. It is also expected to create substantial new job opportunities in the petroleum sector.

The introduction of the concept of revenue sharing is a major step in the direction of “minimum government,

maximum governance”, as it will not be necessary for the Indian Government to verify the costs incurred by

the Contractors. Marketing and pricing freedom will further simplify the process.

HELP provides for the model revenue sharing contract (“Model RSC”) to be entered between the Indian

Government and Contractors, in order to increase domestic oil and gas production, enhance transparency and

reduce administrative discretion in the petroleum and natural gas sector. The key features of the Model RSC

are:

(i) a defined mechanism for the development of a common reservoir between any such Contractors who are

at different stages of the E&P lifecycle in their respective blocks and for approval in change in

operatorship, if needed, in respect of PML or PEL (as the case may be);

(ii) a flexible approach towards the undertaking of PEL and PML and joint usage of infrastructure in adjacent

blocks by Contractors during the entire duration of the respective lease; and

(iii) removal of any Indian Government or MoPNG restriction on exploration and mining activities during

the contract period under the Model RSC.

Marketing and Pricing freedom for New Gas Production from Deep-Water, Ultra Deep Water and High

Pressure-High Temperature Areas

The salient features of the MoPNG on ‘Marketing and Pricing freedom for new gas production from

Deep-water, Ultra Deep water and High Pressure-High Temperature Areas’ dated 21 March 2016 bearing

reference no. O-22013/27/2012-ONG-D-V(Vol-II), (“Marketing and Pricing Freedom Policy”), are as

follows:

(i) For all the discoveries in deep water/ultra-deep water/high temperature/ high pressure areas which are

yet to commence commercial production as on 1 January 2016 and for all future discoveries in such

areas, the producers will be allowed marketing freedom including pricing freedom.

(ii) To protect user industries from any market imperfections, this freedom would be subject to a ceiling

price on the basis of landed price of alternative fuels. To the extent that domestic gas can be produced

and sold at a price below import parity price, it will not only benefit the overall economy by boosting

employment and gross domestic product and reducing imports, but also benefit the user industry by

lowering the average price.

(iii) The ceiling shall be based on publicly available prices of substitute fuels and the method of calculation

shall be communicated transparently.

(iv) The ceiling price shall be calculated as, the lowest of the (i) landed price of imported fuel oil; (ii)

weighted average import landed price of substitute fuels (namely coal, fuel oil and naphtha); and (iii)

landed price of imported LNG. The weighted average import landed price of substitute fuels in (ii) above

will be defined as: 0.3 x price of coal + 0.4 x price of fuel oil + 0.3 x price of naphtha. The Indian

Government has directed that the MoPNG will notify the periodic revision of gas price ceiling under

these guidelines.

A39729228 254

(v) In the case of existing discoveries which are yet to commence commercial production as on 1 January

2016, if there is pending arbitration or litigation filed by the contractors directly pertaining to gas pricing

covering such fields, this policy guideline shall apply only on the conclusion/withdrawal of such

litigation/arbitration and the attendant legal proceedings.

All gas fields currently under production will continue to be governed by the pricing regime which is

currently applicable to them. Under the proposal to grant marketing including pricing freedom for the gas

produced from High Pressure High Temperature, deep-water and ultra deep-water areas. The marketing freedom

so granted would be capped by a ceiling price arrived at on the basis of landed price of alternative fuels.

In accordance with the Indian Government directives, the policy guidelines would be applicable to future

discoveries as well as existing discoveries which are yet to commence commercial production as on 1 January

2016. However, in the case of existing discoveries which are yet to commence commercial production as on 1

January 2016, if there is pending arbitration or litigation filed by the contractors directly pertaining to gas

pricing covering such fields, this policy guideline shall be made applicable only on the conclusion/ withdrawal

of such litigation/ arbitration and the attendant legal proceedings. All gas fields currently under production will

continue to be governed by the pricing regime which is currently applicable to them.

The ceiling price in U.S.$ per MMbtu (gross calorific value) shall be the, lowest of the (i) Fuel oil import

landed price; (ii) Weighted average import landed price of substitute fuels (0.3 x price of coal + 0.4 x price of

fuel oil + 0.3 x price of naphtha); and (iii) LNG import landed price, whichever is lower.

The landed price-based ceiling will be calculated once every six months and applied prospectively for

the next six months. The price data used for calculation of the ceiling price in U.S.$ per MMbtu (gross calorific

value) shall be the trailing four quarters data with one quarter lag. Director General of Petroleum Planning and

Analysis Cell under the MoPNG will notify the periodic revision of the gas price ceiling under these guidelines.

Consequences of the Marketing and Pricing Freedom Policy

Production Enhancement

The aforementioned policy decision will improve the viability of some of the discoveries already made

in such areas and also would lead to monetisation of future discoveries as well. The reserves which are expected

to get monetised are of the order of 6.75 TCF or 190 BCM or around 35 mmscmd considering a production

profile of 15 years. The associated reserves are valued at U.S.$28.35 billion. The country’s present gas

production is around 90 mmscmd.

Employment Generation

The aforementioned policy decision will result into monetisation of the 28 discoveries mentioned above

which can result into substantial investment by the contractors. It is expected that there would be substantial

employment generated during the development phase of these discoveries and a part of it would continue during

the production.

The Company has estimated that in the development of discoveries in the block KG-DWN-98/2, there

would be deployment of 3850 direct skilled labours. Besides, these there would be around 20,000 persons

required during the construction phase. GSPC presently in the block KG-OSN-2001/3 is deploying around 690

personnel in the block.

Transparency and Minimum Government and Maximum Governance

As per the policy, the Indian Government will not interfere in the price fixing for every block covered

under the policy. There will be provision of ceiling to balance the requirements of consuming sectors as well as

to incentivise upstream investment and avoid getting into unnecessary details.

A39729228 255

Policy for grant of extension to the PSCs for small, medium sized and discovered fields

Twenty-eight small, medium sized fields discovered by NOCs, such as the Company, were awarded to

Private Joint Ventures through PSCs between 1994-1998 for periods varying from 18 to 25 years. These PSCs

are effective from different points in time. The earliest of PSCs were signed in 1994. Out of 28 PSCs, two fields

in which the duration of the PSC had expired in 2013 had been granted extension up to 2018. The remaining

PSCs would start expiring from 2018.

For many of these fields the recoverable reserves are not likely to be produced within the remaining

duration of contract. Further, in certain fields where additional recovery of hydrocarbons can be obtained only

through capital intensive Enhanced Oil Recovery/Improved Oil Recovery (EOR/IOR) Projects, the payback

period would extend beyond the current duration of the contract.

A uniform and transparent policy for extension of the remaining reserves is required to be put in place

to enable the contractors to take investment decisions for exploitation of the remaining reserves. It is expected

to expedite decision making, enable timely planning by the contractors, and lead to increased oil and gas

production.

The following process and guidelines for extension of contracts for small and medium sized discovered

fields are being put in place by the Indian Government:

(i) The contractor should submit the application for extension of contract at least two years in advance of

the expiry date, but not more than six years in advance. The DGH will make a recommendation within

six months of submission of application by the contractor. The Indian Government will take a decision

on the request for extension within three months of receipt of the proposal from DGH.

(ii) The Indian Government share of profit petroleum during the extended period of contract shall be 10.00

per cent. higher than the share as calculated using the normal PSC provisions in any year during the

extended period. For example, if the current profit share, is 10.00 per cent. or 20.00 per cent., it shall

become 20 per cent. or 30.00 per cent., respectively.

(iii) During the extended period of contract, the royalty and Cess shall be payable at prevailing rates and not

at concessional rates stipulated in the contracts.

(iv) The extension of these PSCs would be considered for 10 years both for oil and gas fields or the economic

life of the Field, whichever is earlier.

Royalty

The Oilfields Act provides for payment of royalties in respect of any mineral oil mined, quarried,

excavated or collected from the leased area. The Indian Government may increase the rate of royalty payable

for the production of crude oil and natural gas up to limits prescribed by the Oilfields Act by issuing a

notification. Alternatively, the Indian Government could also increase prescribed limits by amending the

Oilfields Act. Under the Oilfields Act and NELP, royalty on crude oil and natural gas is payable as a percentage

of wellhead value derived from sales price. Pursuant to HELP, a graded system of royalty rates has been

introduced, in which royalty rates decreases from shallow water to deep water and ultra-deep water. At the same

time, royalty rates for on-land areas have been kept intact so that revenues to the state governments are not

affected.

Recognising the higher risks and costs involved in exploration and production from offshore areas, lower

royalty rates for such areas have been provided as compared to NELP royalty rates to encourage exploration

and production. The implementation of HELP will enhance domestic oil and gas production, bring substantial

investment in the sector and generate sizeable employment. The policy is also aimed at enhancing transparency

and reducing administrative discretion.

A39729228 256

The uniform licence will enable the contractor to explore conventional as well as unconventional oil and

gas resources including coal bed methane, shale gas/oil, tight gas and gas hydrates under a single licence. Under

the new regime, the Indian Government will not be concerned with the cost incurred and will receive a share of

the gross revenue from the sale of oil and gas.

Oil Cess

The Oil Industry Development Board (the “OIDB”) is constituted under the Oil Industry (Development)

Act, 1974. OIDB receives Indian Government funding out of Cess collected on crude oil and natural gas

production in India, and provides financial and other assistance for development activities in the oil and natural

gas sector in India, out of the Oil Industry Development Fund. The functions of OIDB are, inter alia, rendering

financial and other assistance for the promotion of all such measures as are conducive to the development of

the oil industry. Before rendering any such assistance to any oil industry concern or other person, the OIDB

shall have regard to such directions as the Indian Government may issue in this regard. If an oil industry concern

or other person defaults in repayment of any loan or advance or meeting its obligation in relation to any

assistance rendered by the OIDB, OIDB may apply to the courts for certain reliefs for recovery of the loan. One

of the reliefs is the transfer of the management of the defaulted oil industrial concern to OIDB. As of 31 March

2019, the Company has no outstanding loan or financial assistance under the guarantee of OIDB. Therefore,

these provisions currently have no impact on the Company. Up to February 2016, OID Cess on crude oil

produced from nominated blocks and pre-NELP exploratory blocks was levied at a specific rate of Rs.

4,500/MT. effective from 1 March 2016. However, pursuant to its notification dated 28 March 2016, the Indian

Government has amended the Oil Industries Development Act, 1974 and made OID Cess at 20 per cent. ad-

valorem. Further, under HELP, Cess and import duty will not be applicable to blocks awarded thereunder. HELP

also provides for marketing freedom for crude oil and natural gas produced from these blocks, and absence of

levy of Cess on crude oil.

Excise Duty

Every excise duty leviable under the Oil Industry (Development) Act, 1974, shall be payable by the

person by whom such item is produced, and in case of crude oil, excise shall be collected on the quantity

received in a refinery. The proceeds of such excise duty shall first be credited to the Consolidated Fund of India.

The Finance (No. 2) Act 2019 has increased the rate of additional duty on excise relating to petroleum

products under the IT Act.

Laying of Pipelines

Petroleum and Minerals Pipelines (Acquisition of Right of User in Land) Act, 1962 (the “Pipelines Act”)

The Pipelines Act establishes the framework governing the acquisition of right of user (“RoU”) in land

for the purpose of laying pipelines to transport petroleum and minerals and other related matters. The Pipelines

Act stipulates the acquisition procedure, the restrictions imposed on the RoU in land, and the compensation

payable to persons interested in the land. Any RoU acquisition will be subject to conditions deemed fit by the

Indian Government in favour of public interest.

In addition to the Pipelines Act, other rules and regulations governing the laying of pipelines include the

Guidelines for Laying Petroleum Product Pipelines, 2002, the Policy for Development of Natural Gas Pipelines

and City or Local Natural Gas Distribution Networks, 2006, the Petroleum and Natural Gas Regulatory Board

(Authorising Entities to Lay, Build, Operate or Expand Natural Gas Pipelines) Regulations, 2008 and the

Petroleum and Natural Gas Regulatory Board (Guiding Principles for Declaring or Authorising Natural Gas

Pipeline as Common Carrier or Contract Carrier) Regulations, 2009 and the Oil Mines Regulations, 2017.

A39729228 257

Pipeline Tariffs

Under the PNGRB Act, the Petroleum and Natural Gas Regulatory Board (the “PNG Board”)

determines the transportation tariffs applicable to (i) common or contract carrier transmission pipelines; (ii) city

or local natural gas distribution networks. The tariffs are payable on a zonal basis. All users within the same

zone are treated equally without any preferential treatment given to particular users. The PNG Board may

separately charge additional compression charge for the compression of natural gas to the extent not included

in the tariff. The Petroleum and Natural Gas Regulatory Board (Determination of Natural Gas Pipeline Tariff)

Regulations, 2008 (“Pipeline Tariff Regulations”), was notified by the PNG Board under the PNGRB Act on

20 November 2008. The Pipeline Tariff Regulation sets forth the procedure for determining the tariffs applicable

to natural gas pipeline (the “NGS Tariff”). The Pipeline Tariff Regulations do not apply to (i) any pipeline laid

that is dedicated to transport natural gas to a specific customer as opposed to re-selling it further, and (ii)

pipelines in a city or local gas distribution network which are regulated by the Gas Pipeline Regulations. Under

the Pipeline Tariff Regulations, the NGS Tariff is the sum of (i) the operative expense for the operating of the

natural gas pipeline; and (ii) a premium which takes into account the reasonable rate of return of the capital

employed, each of (i) and (ii) should be calculated on a Normative Level basis. For the purpose of this

paragraph, “Normative Level” means, in relation to the operating expense and capital (as the case may be), a

level that is reasonable and justifiable having taken into amount incurred to lay, build, operate or expand an

efficient natural gas pipeline over its entire economic life (being a period of 25 years commencing from the

date when the authorisation is granted or the commencement date of the physical activities, each with respect

to the relevant project. Entities subject to the Pipeline Tariff Regulations are required to submit its computation

methods for determining the unit NGS tariff over all the tariff zones throughout the economic life of the project.

The economic life of the project shall be a period of 25 years from the date of grant of authorisation or the start-

up date of the commencement of physical activities. The Pipeline Tariff Regulations also require the entity

involved to submit for the PNG Board’s approval, the calculations in respect of apportioning of the unit natural

gas pipeline tariff over all the tariff zones during the economic life of the project.

Guidelines on Safety

Petroleum and Natural Gas (Safety in Offshore Operations) Rules, 2008 (the “Safety Rules”)

The Safety Rules which regulates the safety in offshore oil and gas exploration, exploitation, production,

drilling and related matters were by the MoPNG under the Oilfields Act on 18 June 2008. The Oil Industry

Safety Directorate is the competent authority which exercises powers under the Safety Rules. Under the Safety

Rules, the licensees, lessees, or operators (each an “Operator”) are required to undertake petroleum activities

in a safe manner by implementing plans and activities which are not only healthy and safe for an individual but

also environmentally friendly. Consent for new and existing mobile or fixed offshore installation is required

from the competent authority within the period specified in the Safety Rules. The Safety Rules require operators

of offshore installations to report to the competent authority within 30 days of commencement, or cessation of

operations. The Operator is also responsible for (i) providing health related resources, (ii) establishing a safety

management system, (iii) carrying out risk assessment, (iv) maintaining information and records for petroleum

activities (including permanent plugging of wells), accidental pollution, recovery incidents, rescue measures

and the remedial actions taken, and (v) reporting on the impact of its activities on the environment. In addition

to the Safety Rules, the following rules and regulations setting the safety standards for petroleum and natural

gas activities remain applicable:

the Petroleum and Natural Gas Regulatory Board (Procedure for Development of Technical Standards

and Specifications including Safety Standards) Regulations, 2009 which stipulates the procedures for

developing draft standards by technical committees or standard development organisations for activities

relating to petroleum, petroleum products and natural gas, which includes the construction and operation

of pipeline and infrastructure projects related to downstream petroleum and natural gas sector;

A39729228 258

the Petroleum and Natural Gas Regulatory Board (Technical Standards and Specifications including

Safety Standards for Natural Gas Pipelines) Regulations, 2009 which stipulate (i) safety matters

pertaining to the common carrier or contract carrier natural gas pipelines, including pipeline design,

materials and equipment, welding, fabrication, installation, testing, commissioning, operation and

maintenance and corrosion control; and (ii) safety requirements for natural gas pipelines; and

the Petroleum and Natural Gas Regulatory Board (Technical Standards and Specifications including

Safety Standards for City or Local Natural Gas Distribution Networks) Regulations, 2009 which

stipulate the safety aspects of the operation and maintenance of CGD networks.

The Oilfields (Regulation and Development) Act, 1948 (the “Oilfields Act”)

Oil and natural gas exploration activities are governed by the Oilfields Act, which provides for the

regulation of oilfields and for the development of mineral oil resources. “Oilfields” are defined as any area

where any operation for the purpose of obtaining natural gas and petroleum, crude oil, refined oil, partially

refined oil and any of the products of petroleum in a liquid or solid state is to be or is being carried on, and

“mineral oils” are defined to include natural gas and petroleum.

Under the Oilfields Act, the Indian Government is empowered to frame rules with respect to regulating,

among other things, the granting of mining leases, the granting of petroleum exploration or prospecting licenses

and the production of oil and regulation of the operations carried on in oilfields. The Oilfields Act also provides

for payment of royalties in respect of mineral oils mined from the leased area.

The Mines Act, 1952 (the “Mines Act”)

The Mines Act, along with the rules and regulations therein, seeks to regulate the working condition in

mines (including oil and natural gas extraction facilities) by providing for measures to be taken for the safety

of the workers employed. The Mines Act has been enacted with the objective of providing for the health, safety

and welfare of workers employed in the mines against industrial and occupational hazards. The enactment

provides duties, guidelines and standards that are to be maintained during mining operations and management

of mines; hours and limitation of employment; leave with wages of mine workers. It empowers the central

government to appoint qualified persons as inspectors and chief inspectors of mines who shall have the power

to inspect and examine any part of the mine at any time, in order to ascertain whether the provisions of the

Mines Act, and the rules and regulations therein, are being followed. General disobedience of orders or non-

compliance with the provisions of the Mines Act may result in both criminal and civil penalties.

The Mines Act is administered through the Directorate General of Mines Safety, which is the regulatory

agency for safety in mines and oversees compliance, with the objective of reducing the risk of occupational

diseases and casualty to persons employed in mines.

Currently, a bill on the Occupational Safety, Health and Working Conditions Code, 2019 (Bill no. 186

of 2019, “Bill 186/2019”) has been introduced in Lok Sabha which amends and consolidates laws and

regulations on occupational health and working conditions of the persons employed in an establishment and the

matters connected or incidental thereto. Bill 186/2019 will merge 13 acts, and among them, the Mines Act. Bill

186/2019 seeks to widen the applicability of the Mines Act, and among other things, provides for the regulation

of health and safety of persons employed in the mines, including territorial waters, the continental shelf, the

exclusive economic zone and other maritime zones within its ambit. Bill 186/2019 further seeks to replace the

meaning of the term “owner” to include a person or authority having ultimate control over the affairs of the

respective mine. Additionally, Bill 186/2019 aims to enhance fines and penalties to be levied under the Mines

Act. Bill 186/2019, if and when notified in the official gazette, will amend the current Mines Act.

A39729228 259

Oil Mines Regulations, 2017 (the “Oil Mines Regulations”)

The Oil Mines Regulations apply to every oil mine in India. The Oil Mines Regulations, among other

things, define the term “oil” to include natural gas and petroleum and stipulate that an oil mine shall commence

operations after the appointment of a duly qualified manager, who will be allowed to act as a manager of a

single oil mine only. The owner of the respective oil mine shall appoint an agent to act on his behalf, in order

to manage, control, supervise and direct such oil mine. The owner, agent or manager of the oil mine shall further

appoint a deputy manager, installation manager, safety officer, surveyor and fire officer with respect to their oil

mine. The owner, agent or manager of the respective oil mine shall serve notice of the commencement of any

mining operation in their oil mine to the relevant chief inspector of mines, regional inspector and district

magistrate along with a plan enumerating the geographical boundaries, other surface features and safety

management plan. The Oil Mines Regulations provide for the payment of compensation in respect of

employees, in the case of any dangerous occurrence, accident or diseases on the premises of any oil mine. Such

occurrences are to be reported by the owner, agent or manager to the relevant chief inspector of mines, regional

inspector and district inspector. The Oil Mines Regulations also prescribe (i) the appointment procedure and

the qualification requirements of the respective inspectors, management and competent persons related to an

oil mine, (ii) the duties and responsibilities of management, contractors, manufacturers, competent persons and

workmen employed at the mine, and (iii) precautions with respect to drilling, over-work operations, production

and pipeline transportation facilities to be observed in an oil mine.

Under the Oil Mines Regulations, the manager is required to classify various areas of the oil mine into

different zones, including the distinction of hazardous areas. The installation of fire-fighting facilities and

framing of emergency plans must be conducted by the owner, agent and manager of the oil mine (as the case

may be) and submitted to the relevant regional inspector of mines and district magistrate. The Oil Mines

Regulations specifically mandate that no transportation of natural gas or petroleum shall take place unless the

designated oil mine area is under the sole control of the owner of the oil mine, or, right of use with respect to

such oil mine has been obtained by the owner.

Petroleum Act, 1934 (the “Petroleum Act”)

The Petroleum Act empowers the Indian Government to frame rules regarding the import, transport,

storage, blending, refining and production of petroleum. It further empowers the Indian Government to

prescribe standards for petroleum pipelines, testing apparatus, tanks, certification and storage receptacles for

petroleum, as well as to inspect petroleum at any place within India through state appointed testing officers.

Notice of accidents with petroleum must be given by the person in charge of such petroleum to the nearest

magistrate or police station. The Petroleum Act further provides penalties for contravention of its provisions.

Petroleum Rules, 2002 (the “Petroleum Rules”)

The Petroleum Rules require, among other things, a company to obtain permission from the chief

controller of the Petroleum and Explosive Safety Organisation for refining, cracking, storing, reforming or

blending petroleum. Under the Petroleum Rules, no person is permitted to deliver or dispatch any petroleum to

anyone in India other than the holder of a storage licence issued under the Petroleum Rules or his authorised

agent or a port authority or railway administration or a person who is authorised under the Petroleum Act to

store petroleum without a licence. Petroleum Rules prohibit employment of children under the age of 18 years

and a person who is in a state of intoxication in the loading, unloading or transport of petroleum or in any

premises licensed under these rules. Petroleum Rules also seek to regulate the importation of petroleum through

licences.

Petroleum and Natural Gas Rules, 1959 (the “P&NG Rules”)

The P&NG Rules provide the framework for the granting of PELs and PMLs. The P&NG Rules prohibit

the prospecting or exploitation of any oil or gas unless a licence or lease has been granted under the P&NG

A39729228 260

Rules. A PML entitles the lessee to an exclusive right to extract oil and gas from the relevant contract area.

PELs and PMLs are granted by the MoPNG for offshore areas and by the relevant state governments, with the

prior approval of the Indian Government, for onshore areas. A PEL or a PML must contain the terms and

conditions specified in the P&NG Rules. However, they may also contain additional terms and conditions

agreed between the licensee or the lessee and the Indian Government. The term of a PEL is four years, renewable

twice for a period of one year each. The term of a PML is generally 20 years, and the area covered by it is

ordinarily 250 sq. km.. Upon grant of the PML, the lessee has to pay either the prescribed rental or the royalty,

whichever is higher, in relation to the concerned lease. While the rental is payable based on the area of the land

leased, the royalty is the amount that is generally payable as a percentage of the value at well head of the natural

gas obtained by the lessee. The Indian Government has the right to order a royalty to be paid in petroleum and

natural gas instead of money. Under the Oilfields Act, the levy of a royalty is permitted up to 20 per cent. of the

sale price of the mineral oil, which includes natural gas. In the event of a national emergency in respect of

petroleum, the Indian Government has the right of pre-emption in relation to the refined petroleum or petroleum

products produced from the crude oil or natural gas extracted from the area under a lease. Further, under the

P&NG Rules, the Indian Government may, in the interests of conservation of mineral oils (which include natural

gas), restrict the amount of petroleum or natural gas that may be produced by a lessee in a particular field. The

P&NG Rules were amended in July 2018, extending the term “petroleum” to mean hydrocarbons occurring in

gaseous, liquid, viscous, solid state or as a mixture of such states, excluding coal, lignite and helium occurring

in association with petroleum, coal or shale.

Petroleum and Natural Gas Regulatory Board Act, 2006 (the “PNGRB Act”)

The PNGRB Act provides for the establishment of the PNG Board, and vests it with the authority to,

among other things, (i) regulate refining, processing, storing, transporting (including laying of pipelines),

distributing, marketing and importing, exporting and the selling of petroleum, petroleum products and natural

gas (but excluding the production of crude oil and natural gas); (ii) monitoring prices and taking corrective

measures to prevent restrictive trade practices; (iii) imposing fees and other charges; and (iv) regulating

technical and safety standards and specifications relating to petroleum, petroleum products and natural gas.

The objectives of the PNG Board are to protect the interests of consumers and entities engaged in

specified activities relating to petroleum, petroleum products and natural gas, to ensure uninterrupted and

adequate supply of petroleum, petroleum products and natural gas in all parts of India and to promote a market

which values the benefits of competition.

Guidelines on Swapping of Natural Gas (the “Swapping Guidelines”)

In March 2012, the MoPNG issued guidelines, the Swapping Guidelines which apply to the “swapping”

of natural gas whereby a party (the first party) supplies gas to a second party, at a location specified by the

second party, in exchange for the second party supplying the energy equivalent quantity of gas to the first party

or first party’s representative at another location (along with an appropriate indemnity for so doing). The

Swapping Guidelines require that all parties involved be revenue-neutral over the entire length of the pipeline

and any swapping of gas would need to conform to the tariff and applicable PNGRB Act and any dispute

regarding the same would need to be heard before the PNG Board.

Petroleum and Natural Gas Regulatory Board (Authorising Entities to Lay, Build, Operate or Expand

Natural Gas Pipelines) Regulations, 2008 (the “Gas Pipeline Regulations”)

The Gas Pipeline Regulations require all entities proposing, or directed by the Petroleum and Natural

Gas Regulatory Board (“PNGRB”), to lay, build, operate or expand a natural gas pipeline to obtain

authorisation from the PNGRB, on submission of documents demonstrating financial and technical adequacy,

including possession of all requisite regulatory and corporate approvals. The PNGRB may cancel an existing

authorisation under the Gas Pipeline Regulations, if the authorised entity fails to achieve the prescribed

A39729228 261

conditions precedent, including achievement of financial closure or submission of required documentation such

as the requisite corporate approvals or the executed gas transportation agreement.

The Petroleum and Natural Gas Regulatory Board (Authorising Entities to Lay, Build, Operate or

Expand City or Local Natural Gas Distribution Networks) Regulations, 2008 (“Natural Gas

Distribution Regulations”)

The Natural Gas Distribution Regulations, framed by the PNG Board apply, including, but not limited

to, to an entity which is laying, building, operating or expanding, or which proposes to lay, build, operate or

expand a natural gas pipeline for transporting natural gas. Laying, building, operating or expanding natural gas

pipeline can be initiated either through an “expression of interest” by an entity or on its own motion by the PNG

Board. The Natural Gas Distribution Regulations lay down the bidding criteria and the criteria for selection of

an entity for laying, building, operating or expanding natural gas pipelines through the “expression of interest”

route. The fixation and recovery of natural gas pipelines tariff and the quality of service standards have also

been provided by the Natural Gas Distribution Regulations.

The Natural Gas Distribution Regulations were amended in April 2018, to clarify that “contract year”

means a period of 12 months commencing from the date of natural gas pipeline authorisation by the PNG Board

and any subsequent renewal of 12 months. Furthermore, the definition of “force majeure” was introduced to

include the Indian Government and relevant state government restrictions arising post last date of submission

of any bid, which results in prevention or delay of the execution of obligations under these regulations. These

amendments brought about the provision for pre-determined penalty, leviable for under-achievement in the

respective contract year and also amended the criteria for selection of entity for expression of interest route,

linking the minimum net worth of the bidder to the population in the respective geographical area.

The Petroleum and Natural Gas Regulatory Board (Codes of Practices for Emergency Response and

Disaster Management Plan) Regulations, 2010 (the “ERDMP Regulations”)

The ERDMP Regulations are applicable to, among other things, transportation of petroleum products by

road and pipelines, processing installations, petroleum and gas storage facilities and terminals, and liquid

petroleum product pipelines. The scope of the ERDMP Regulations covers identification of emergencies,

mitigation measures that attempt to reduce and eliminate the risk of disasters and plans of action when

emergencies occur.

The Petroleum and Natural Gas Regulatory Board (Determining Capacity of Petroleum, Petroleum

Products and Natural Gas Pipeline) Regulations, 2010

The Petroleum and Natural Gas Regulatory Board (Determining Capacity of Petroleum, Petroleum

Products and Natural Gas Pipeline) Regulations, 2010 apply to entities building, operating and expanding

pipelines. These regulations apply to all new and existing pipelines and regulate, among other things, the

applicable procedures and pipelines’ parameters.

Guidelines for Management of Oil and Gas Resources

The MoPNG issues guidelines for management of oil and gas resources. These guidelines give broad

powers to the DGH for management of oil and gas resources. The powers of the DGH include, among other

things, monitoring the exploration programme for nomination blocks, monitoring the development of

hydrocarbon discoveries, and monitoring oil and gas reservoir management. Through a notification, dated 11

July 2017, the MoPNG further provided guidelines with respect to the maintenance of data relating to petroleum

operations, declarations of commerciality and feasibility reports of petroleum reservoirs.

A39729228 262

Territorial Waters, Continental Shelf, Exclusive Economic Zone and other Maritime Zones Act, 1976

(the “Territorial Waters Act”)

The Territorial Waters Act empowers the Indian Government to extend the application of any central

government legislation to the territorial waters, continental shelf, exclusive economic zone and other maritime

zones of India. Accordingly, the Territorial Waters Act provides for the grant of PELs and PMLs by the Indian

Government (and in respect of land vested in a state Government, by that state Government with prior approval

of the Indian Government) to explore and exploit resources of the continental shelf and the exclusive economic

zone.

Coastal Regulation Zone Notifications

The Ministry of Environment, Forest and Climate Change (“MoEFCC”) issued the Coastal Regulation

Zone (“CRZ”) notification dated 18 January 2019, bearing reference no. G.S.R. 37(E). (“CRZ Notification

2019”) under Sections 3(1) and 3(2)(v) of the EPA and Rule 5(3)(d) of the Environment (Protection) Rules

1986, for the purposes of conserving and protecting the coastal environment. The CRZ Notification 2019 was

passed in supersession of the Coastal Regulation Zone Notification, 2011 dated 6 January 2011. Pursuant to the

CRZ Notification 2019, the Indian Government has declared the coastal stretches of the country and the water

area up to its territorial water limit, excluding the islands of Andaman and Nicobar and Lakshadweep and the

marine areas surrounding these islands, which are influenced by tidal action up to 500 metres from the High

Tide Line (“HTL”), the land between HTL and 50 metres or width of the creek, the land between 162 the Low

Tide Line (“LTL”) and the HTL as Coastal Regulation Zone and the water and the bed area between the LTL

and the territorial water limit (12 nautical miles) as Coastal Regulation Zone; and certain restrictions on the

setting up and expansion of industries, operations or processes, in the said notification. The CRZ Notification

2019 provides a list of prohibited activities and regulates the permissible activities. Operational constructions

for ports and harbours, jetties, quays, wharves, erosion control measures, breakwaters, pipelines, lighthouses,

navigational safety facilities, coastal police stations, Indian coast guard stations and the like have been identified

as an activity requiring environmental and CRZ clearance from the MoEFCC. The CRZ Notification 2019

further divides the coastal zone into four zones and lays down the activities that can be undertaken in each area.

Guidelines for Management of Oil and Gas Resources for Nomination Blocks (the “Oil and Gas

Nomination Block Management Guidelines”)

The Oil and Gas Nomination Block Management Guidelines were announced by the MoPNG in 2007

to regulate nomination blocks which were awarded to NOCs were prior to the introduction of NELP and PSC.

Under the Oil and Gas Nomination Block Management Guidelines, NOCs are required to, among other things,

prepare an appraisal programme of their discoveries made under nomination blocks having consulted the DGH

under a specific time frame that is similar to the requirement set out in NELP. In addition, NOCs are required

to prepare development plans of their discoveries made under nomination blocks in consultation with DGH.

The Oil and Gas Nomination Block Guidelines prescribe the constitution of a management committee

comprised of the DGH, representatives from the MoPNG and a director-level representative from the relevant

NOC. The Director General, DGH, will act as chairman and the DGH is required to review and monitor the

progress and performance of NOCs in accordance with each PEL and international practice. Similar to the PSC

requirements. DGH could also frame procedures for the announcement of hydrocarbon discoveries and the

reporting of hydrocarbon reserves. Furthermore, DGH is responsible for monitoring the development of

hydrocarbon discoveries of nomination blocks and health of reservoirs of all producing fields operated by

NOCs. NOCs (including the Company) are further required to constitute a review committee by the virtue of

the National Oil Companies (Review Committees for Management of Oil and Gas Resources in Nomination

Fields) Order, 2017, for the purpose of, inter alia, review of exploration, development and production

operations and review of proposals for surrender or relinquishment of any part of the area included in the

A39729228 263

nomination field. The advice/decision of the said review committee is required to be implemented forthwith by

the concerned NOC and reported to DGH.

National Resettlement and Rehabilitation Policy, 2007

The National Rehabilitation and Resettlement Policy, 2007 was notified by the Indian Government on

31 October 2007 to rehabilitate and resettle persons (i) affected by the acquisition of land for projects of public

purpose or (ii) displacement involuntary due to any other reason. The Indian Government will establish a

Rehabilitation and Resettlement Committee to monitor the implementation progress of any scheme or

rehabilitation and resettlement of affected families in cases where the involuntary displacement involves (i) 400

or more families en masse in plain areas; (ii) 200 or more families en masse in tribal or hilly areas, blocks of

the Desert Development Programme of the Indian Government (the “DDP”) or areas mentioned in the Fifth or

Sixth Schedule to the Constitution of India of the Indian Government. DDP is a programme set up by the Indian

Government which aims to (i) combat drought and desertification, (ii) mitigate the adverse effect of drought

and desertification on crop production, livestock and people, (ii) encourage restoration of the ecological balance

by harnessing, conserving and developing natural resources. The Rehabilitation and Resettlement Committee

will also carry out post-implementation social audits. The National Rehabilitation and Resettlement Policy,

2007, is a revised and improved version of the National Policy on Resettlement and Rehabilitation for Project

Affected Families, 2003. Under the National Rehabilitation and Resettlement Policy, 2007, project promoters

are required to consider alternative sites before submitting requests for land acquisitions. The area of land to be

acquired will also be limited to a minimum size to commensurate with the purpose of the project. Projects

should, as far as possible, be set up on wasteland, degraded land or un-irrigated land. The Indian Government

should consider options that would minimise the number of people being displaced, the total area of land to be

acquired and the acquisition of agricultural land for non-agricultural projects. In addition, a social impact

assessment is required where an involuntary displacement will involve at least 400 families en masse in plain

areas and 200 families en masse in hills. The aim of this policy is to minimise large-scale displacements.

Policy Guidelines for Exploration and Exploitation of Shale Gas and Oil

In 2013, the MoPNG issued the “Policy Guidelines for Exploration and Exploitation of Shale Gas and

Oil by NOCs under the Nomination Regime, 2013” (the “Guidelines”) to allow shale gas exploitation and

exploration. The Guidelines will be applicable to on-land Oil and Gas Nomination acreages with NOCs, and

they further provide that NOCs holding PEL/PMLs granted under the said regime can apply for rights to exploit

shale gas. NOCs will be required to undertake a minimum work programme with a fixed timeline for shale gas

and oil exploration or exploitation. Tax incentives are offered for shale gas exploitation. The Guidelines provide

that full exemption from basic customs duty and additional duty of customs for specified goods required in

connection with petroleum operations undertaken under petroleum licences or mining leases issued on

nomination basis would be available for exploration and exploitation of shale gas and oil. The Guidelines also

provide that the holder of the PEL/PML will be responsible for ensuring health, safety and environment, site

restoration, and adoption of best industry practices and follow statutory requirements for all purposes under

licence and mining lease. Royalty, Cess and taxes for shale gas and oil would be payable as par with

conventional gas/ oil being produced from the respective areas, at the prevailing rates, as applicable.

The Indian Government further notified the Policy Framework for exploration and exploitation of

unconventional hydrocarbons under existing PSC, coal bed methane contracts and nomination fields dated 20

August 2018, to permit exploration and exploitation of unconventional hydrocarbons such as shale oil, gas, coal

bed methane, in the existing acreages of PSC, coal bed methane contracts, as well as nomination fields to unlock

the potential of unconventional hydrocarbons. The said policy prescribes that 10 per cent. rate of profit

petroleum in case of PSCs and production level payment in case of coal bed methane contract, over and above

the existing rate of profit petroleum/ production level payment, is to be shared with the Indian Government on

new discoveries. For nomination blocks, NOCs will be allowed to explore and exploit the unconventional

A39729228 264

hydrocarbons under the existing fiscal and contractual terms of exploration/lease license. The HELP and

Discovered Small Field Policy also provides for exploration and exploitation of unconventional hydrocarbons

including shale gas/oil in the acreages to be awarded under such policy.

The Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and

Resettlement Act, 2013 (the “RFTLA Act”)

The RFTL Act received the assent of the President of India on 27 September 2013 and came into force

on 1 January 2014. The key provisions of the RFTLA Act are as follows, viz. (i) the RFTLA Act completely

replaces the Land Acquisition Act, 1894, (ii) the process for land acquisition involves a Social Impact

Assessment and Environmental Impact Assessment survey, preliminary notification stating the intent for

acquisition, a declaration of acquisition, and compensation to be given by a certain time. All acquisitions require

rehabilitation and resettlement to be provided to the people affected by the acquisition, (iii) compensation for

the owners of the acquired land shall be four times the market value in case of rural areas and 2 times in case

of urban areas, (iv) in case of acquisition of land for use by private companies or public private partnerships,

consent of 70 per cent. of the displaced people will be required and purchase of large pieces of land by private

companies will require provision of rehabilitation and resettlement, and (v) the provisions of the RFTLA Act

shall not apply to acquisitions under 13 existing legislations, inter alia, the Electricity Act, 2003, the Atomic

Energy Act, 1962 and the Railways Act, 1989.

Environmental Laws and Regulations

The Company’s business is subject to environmental laws and regulations. The applicability of these

laws and regulations varies from operation to operation and is also dependent on the jurisdiction in which the

Company operates in. Major environmental laws applicable to the Company’s operations include the

Environmental (Protection) Act, 1986 (“EPA”), the Water (Prevention and Control of Pollution) Act, 1974

(“Water Act”) and the Air (Prevention and Control of Pollution) Act, 1981 (“Air Act”). Pollution Control

Boards (“PCBs”) have been constituted in several states in India to implement the provisions of some of the

environmental laws and companies are required to obtain their approvals in relation to certain activities affecting

the environment.

The Indian Government has formulated legislation for exploration and production and refining and

manufacturing companies that have operations in environmentally sensitive areas. A detailed environmental

impact assessment study is required to be carried out in phases before commencement of certain operations so

that the impact on biodiversity and ecological sensitivity can be reduced through mitigating measures. The EPA,

the Water Act and the Air Act provide for the prevention, control and abatement of pollution. PCBs have been

established in all states in India to exercise the powers under these statutes in order to prevent and control

pollution. Companies must obtain the prior clearance of the relevant state PCBs for emissions and discharge of

effluents into the environment. If the project value exceeds Rs. 1 billion for a new project or Rs. 500 million

for the expansion of existing oil and gas exploration and production project, the project also requires the

approval of the MoEFCC. All offshore and onshore oil and gas exploration, development and production

projects require a prior environmental clearance from MoEFCC under category 1(b) of the schedule of the

Environment Impact Assessment Notification, 2006.

The Hazardous and Other Wastes (Management and Trans-boundary Movement) Rules, 2016, enlist

processes such as petrochemical processes and pyrolytic operations, crude oil and natural gas production,

petroleum refining or re-processing of used oil or recycling of waste oil as processes which generate hazardous

waste. The hazardous waste generated by each of these processes is specified in Schedule 1 of the

aforementioned rules which on account of their physical, chemical, reactive, toxic, flammable, explosive or

corrosive characteristics create danger to health or environment. These rules impose an obligation on each

occupier and operator of any facility generating hazardous waste to dispose of such hazardous waste in

accordance with the steps delineated in the aforementioned rules. They also impose obligations in respect of

A39729228 265

the collection, treatment and storage of hazardous wastes on the relevant state government, occupier, operator

of a facility or any association of occupiers. Each occupier and operator of any facility generating hazardous

waste is required to obtain an authorisation from the relevant state Pollution Control Board for collecting,

storing, handling and treating the hazardous waste. Moreover, the relevant state Pollution Control Board is

required to monitor the setting up and operation of the common or captive treatment, storage and disposal

facility regularly. Further, registration has to be obtained by any person desirous of recycling or reprocessing

hazardous wastes. These rules also impose restrictions on import and export of hazardous wastes. MoEFCC is

the nodal Ministry to deal with trans-boundary movement of hazardous wastes.

In addition, the Territorial Waters, Continental Shelf, Exclusive Economic Zone and other Maritime

Zones Act, 1976 regulates the exploration and exploitation of resources of the continental shelf and exclusive

economic zone. The exploration activities of the offshore blocks acquired may also be subject to this statute.

In addition, the Merchant Shipping Act, 1958 provides for liability in respect of loss or damage caused

outside the ship by contamination resulting from the escape or discharge of oil from the ship, wherever such

escape or discharge occurs.

Under the Indian Forest Act, 1927, state governments have the power to declare any land covered by

forests or any wasteland in a state a “reserved forest”, “village forest” or “protected forest”. The conduct of

upstream operations for petroleum or natural gas in such areas requires prior approval of the competent

authority. Furthermore, exploration, development or production operations for petroleum and natural gas are

not permitted in areas designated as sanctuaries or reserves under the Indian Wildlife (Protection) Act, 1972.

Other laws and regulations may apply to the Issuer, including, but not limited to, the Scheduled Tribes

and Other Traditional Forest Dwellers (Recognition of Forest Rights) Act, 2006, Wildlife Protection Act, 1972,

National Ambient Air Quality Standards, 2009, Manufacture, Storage and Import of Hazardous Chemical Rules,

1989, Manufacture, Storage and Import of Hazardous Chemical (Amendment) Rules, 2000, Bio – Medical

Waste Management Rules, 2016, Solid Waste Management Rules, 2016, Plastic Waste Management Rules,

2016, Recycled Plastics Manufacture and Usage Rules, 1999, Noise Pollution (Regulation and Control) Rules,

2000, Noise Pollution (Regulation and Control) Amendment Rules, 2010, Batteries (Management and

Handling) Rules, 2001 and the Batteries (Management and Handling) Amendment Rules, 2010.

Forest (Conservation) Act, 1980 (the “Forest Conservation Act”)

The Forest Conservation Act has been enacted to protect forests and for matters connected therewith or

ancillary or incidental thereto in India. The Forest Conservation Act requires prior approval of the Indian

Government, through MoEFCC, for any land covered by forest to be leased or used for industrial purposes and

the de-reservation of any land notified as a “Reserved Forest” by a state government under the Indian Forest

Act, 1927. However, the Forest Bill was withdrawn from Rajya Sabha.

Under the Forest (Conservation) Rules, 2003, issued by the Indian Government pursuant to the Forest

Conservation Act, a party wishing to carry out operations in a block covered by forests or in areas that have

been declared “Reserved Forest” under the Indian Forest Act, 1927 are required to submit an application for

approval to the MoEFCC. Clearance under the Forest Conservation Act typically requires undertakings and

payments to be made for the cost of re-forestation, in accordance with schemes notified by the state government,

in the relevant areas.

The Environment (Protection) Act, 1986 (the “EPA”) and the Environment (Protection) Rules, 1986

(the “EPR”)

The EPA is the umbrella legislation in respect of the various environmental protection laws in India. The

EPA vests the Indian Government with the power to take any measure it deems necessary or expedient for

protecting and improving the quality of the environment and preventing and controlling environmental

A39729228 266

pollution. This includes rules for, inter alia, laying down the quality of environment, standards for emission or

discharge of environmental pollutants from various sources, prevention of accidents, inspection of any

premises, plant, equipment or machinery, examination of manufacturing processes, laying down procedures and

safeguards for the handling of hazardous substances; preparation of manuals, codes or guides relating to the

prevention, control and abatement of environmental pollution; and materials likely to cause pollution.

The EPA contains provisions with respect to certain compliances by persons handling hazardous

substances, furnishing of information to the authorities in certain cases, establishment of environment

laboratories and appointment of Indian Government analysts.

The EPR prescribes standards for emission or discharge of environmental pollutants from industries. It

also contains provisions relating to prohibition and restriction on location of industries and the carrying on of

processes and operations in different areas. The EPR also mandates the submission of an annual environmental

statement to the concerned State Pollution Control Board by every person carrying on an industry, operation or

process requiring consents under the Air Act and Water Act, or authorisation under the Hazardous and Other

Wastes (Management and Trans-boundary Movement) Rules, 2016.

Penalties for violation of the EPA include fines, imprisonment or both.

The Environment Impact Assessment Notification dated 14 September 2006, bearing reference no. S.

O. 1533(E) (the “EIA Notification”)

The EIA Notification issued under the EPA and the Environment (Protection) Rules, 1986, provides that

the prior environmental clearance of MoEFCC or the State Environment Impact Assessment Authority, as the

case may be, is required for the establishment of any new project and for the expansion or modernisation of

existing projects specified in the EIA Notification. The EIA Notification states that the obtaining of prior

environmental clearance includes a maximum of four stages, including screening, scoping, public consultation

and appraisal.

An application for prior environmental clearance is made after the identification of prospective site(s)

for the project and/or activities to which the application relates but before commencing any construction

activity, or preparation of land, at the site by the applicant. Certain projects which require approval from the

State Environment Impact Assessment Authority may not require an Environment Impact Assessment Report.

For projects that require preparation of an Environment Impact Assessment Report, public consultation

involving both a public hearing for ascertaining concerns of local affected persons and obtaining written

responses from other concerned persons having a plausible stake in the environmental aspects of the project or

activity is conducted by the State PCB. The Expert Appraisal Committee or State Level Expert Appraisal

Committee, as the case may be, makes an appraisal of the project only after a Final EIA Report is submitted

addressing the questions raised in the public consultation process. The prior environmental clearance granted

for a project or activity is valid for the life of a project as estimated by the Expert Appraisal Committee or State

Level Expert Appraisal Committee subject to a maximum of 30 years for mining projects and five years in the

case of all other projects and activities. This period of validity may be extended by the regulatory authority

concerned (MoEFCC or the State Environment Impact Assessment Authority, as the case may be) by a

maximum period of five years.

Draft National Forest Policy, 2018

The MoEFCC has issued a Draft National Forest Policy 2018, which seeks to address the conservation,

protection and management of forests and other issues associated with forest and forest management. In order

to protect the interest of tribals, the said draft policy also proposes to launch a community forest management

mission, which will in turn enable the management of community forest resources though a participatory forest

management approach. Moreover, specific provisions have been inserted in the draft policy to ensure that the

interests of local communities are protected and to consider such local communities as partners in the

A39729228 267

management of forests. As of the date of this Offering Circular, the MoEFCC is yet to notify the Draft National

Forest Policy 2018.

Labour and Employment Laws

There are various labour and employment laws that are applicable to the Issuer. These enactments

regulate the terms and conditions of service and employment of workers and their work environment and aim

to protect and safeguard the interests of these workers to ensure higher productivity and vocational skills

training. The primary focus of these applicable laws is to promote welfare and provision of social security to

the labour force employed at an establishment.

The enactments applicable to the Issuer in respect of labour and employment laws, include, but are not

limited to, the Employees’ Compensation Act, 1923, the Trade Unions Act, 1926, the Payment of Wages Act,

1936, the Industrial Disputes Act, 1947, the Minimum Wages Act, 1948, the Workmen Compensation Act, 1923,

the Employees’ State Insurance Act, 1948, the Factories Act, 1948, the Employees’ Provident Funds and

Miscellaneous Provisions Act, 1952, the Employment Exchange (Compulsory Notification of Vacancies) Act,

1959, the Maternity Benefit Act, 1961, the Payment of Bonus Act, 1965, the Industrial Employment (Standing

Orders) Act, 1946, the Contract Labour (Regulation and Abolition) Act, 1970, the Payment of Gratuity Act,

1972, the Equal Remuneration Act, 1976, the Inter-State Migrant Workmen (Regulation of Employment and

Conditions of Service) Act, 1979, the Child and Adolescent Labour (Prohibition and Regulation) Act, 1986, and

the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

It must be noted that the Code on Occupational Safety, Health and Working Conditions Bill, 2019 (“Code

on Safety”) and the Code on Wages Bill, 2019 (“Code on Wages”) has been introduced in the Lok Sabha on

23 July 2019.

The Code on Safety intends to subsume, inter alia, the Factories Act, 1948, the Mines Act, 1952, the

Dock Workers (Safety, Health and Welfare) Act, 1986 and the Contract Labour (Regulation and Abolition) Act,

1970 into one enactment. It enhances the ambit of provisions relating to safety, health, welfare and working

conditions of employees. The Code on Safety will be applicable to all establishments employing 10 or more

employees.

The Code on Wages also intends to subsume the Minimum Wages Act, 1948, the Payment of Wages Act,

1936, the Payment of Bonus Act, 1965 and the Equal Remuneration Act, 1976 into one enactment. The primary

aim of the Code on Wages is to remove the multiplicity of labour law-related definitions and authorities leading

to ease of compliance, without compromising the wage security and social security of workers.

Foreign Exchange Laws

Foreign Direct Investment

The Indian Government’s Department of Industrial Policy and Promotion, Ministry of Commerce and

Industry (“DIPP”) has issued the “Consolidated FDI Policy”, with effect from 28 August 2017 (the “FDI

Policy”) which consolidates the policy framework on foreign direct investment (“FDI”). DIPP makes policy

pronouncements on FDI through press notes or press releases which are notified by the RBI from time to time.

Foreign investment in India is governed by the provisions of FEMA which relates to regulations

primarily issued by the RBI and the rules, circulars, press notes and notifications issued thereunder. The RBI,

in exercise of its power under the FEMA, has notified the Foreign Exchange Management (Transfer or Issue of

Security by a Person Resident Outside India) Regulations, 2017, to prohibit, restrict or regulate the transfer by

or issue of security to a person resident outside India. No prior consent and approval is required from the RBI

for FDI under the automatic route within the specified sectoral caps. In respect of all industries not specified as

FDI under the automatic route, or in respect of investment in excess of the specified sectoral limits under the

A39729228 268

automatic route, approval may be required from the respective administrative ministries of the Indian

Government for the relevant sector.

In accordance with the FDI Policy, FDI up to 100 per cent. under the automatic route is permitted in

exploration activities of oil and natural gas fields, infrastructure related to marketing of the petroleum products

and natural gas, the marketing of natural gas and petroleum products, petroleum product pipelines, natural gas

pipelines, LNG regasification infrastructure, market study and formulation and petroleum refining in the private

sector. Such investment is subject to the existing sectoral policy and regulatory framework in the oil marketing

sector and the policy of the Indian Government on private participation in exploration of oil and the discovered

fields of national oil companies. Further, FDI up to 49 per cent. is permissible under the automatic route for

petroleum refining by the public sector undertakings without any disinvestment or dilution of domestic equity

in the existing public sector undertakings. Investors are urged to consult their own advisers in connection with

the applicability of any Indian laws or regulations.

External Commercial Borrowings by a Domestic Issuer and guaranteed by Oil and Natural Gas

Corporation Limited and External Commercial Borrowings raised by Oil and Natural Gas Corporation

Limited (“Indian Issuer Notes”)

The RBI, in exercise of its power under the FEMA, has notified the Foreign Exchange Management

(Borrowing and Lending) Regulations, 2018, as amended from time to time (the “Borrowing Regulations”) to

regulate the borrowing and lending in foreign exchange by a person resident in India. Pursuant to the Borrowing

Regulations, the RBI issues guidelines regulating external commercial borrowings (“ECBs”) from time to time,

the most recent one being the RBI Master Directions on “External Commercial Borrowings, Trade Credit and

Structured Obligations”, as amended from time to time (RBI/FED/2018-19/67 FED Master Direction

No.5/2018-19) dated 26 March 2019 and the RBI Master Directions on “Reporting under Foreign Exchange

Management Act, 1999” dated 1 January 2016 (“ECB Guidelines”) raised by resident Indian entities from

recognised lenders and conforming to specific requirements in the ECB Guidelines. ECBs can be accessed

under two routes, being: (i) the automatic route and (ii) the approval route. The ECB Guidelines regulate the

maintenance of prudent limits for total external borrowings, end use, all in cost ceilings and reporting

requirements amongst other terms of borrowing. The automatic route does not require a borrower to obtain any

RBI approvals, whereas the approval route refers to circumstances where prior RBI approval is mandatory

before raising an ECB. The ECB Guidelines are subject to amendment from time to time and investors are urged

to consult their own advisers in connection with the applicability of any Indian laws or regulations.

In this Offering Circular, “Indian Issuer Notes” means FCNY Notes and Rupee Denominated Notes.

“FCNY Notes” means Notes denominated in foreign currency as ECB issued by (i) a Domestic Issuer and

guaranteed by the Guarantor and (ii) the Guarantor directly and “Rupee Denominated Notes” means Notes

denominated in Rupees as ECB where amounts are payable in Indian Rupees raised by (i) a Domestic Issuer

and guaranteed by Guarantor and (ii) the Guarantor directly. The maximum amount which can be raised every

financial year under the automatic route is U.S.$750 million or its equivalent. The ECB Guidelines classify

ECBs under two categories:

(i) Foreign currency denominated ECBs (which would include Indian Issuer Notes other than the Rupee

Denominated Notes) (“FCNY ECBs”); and

(ii) Rupee denominated ECBs (which would include Rupee Denominated Notes) (“Rupee ECBs”).

The ECB Guidelines prescribes that the public sector oil marketing companies (“OMCs”) can raise ECB

for working capital purposes with minimum average maturity period of 3 years from all lenders under the

automatic route without mandatory hedging and individual limit requirements. The overall ceiling for such

ECBs is U.S.$10 billion or equivalent. However, OMCs should have a board approved forex mark to market

procedure and prudent risk management policy for such ECBs.

A39729228 269

Automatic Route

Foreign investors eligible to lend ECBs must be one of the following under the ECB Guidelines: (i) a

resident of a FATF Compliant Country or an IOSCO Compliant Country, (ii) a multilateral and regional financial

institution; (iii) individuals who are from a FATF Compliant Country or an IOSCO Compliant Country if they

are foreign equity holders or the Indian Issuer Notes are listed; or (iv) (a) in the case of FCNY Notes (and

excluding Rupee Denominated Notes), foreign branches or subsidiaries of Indian banks and subject to

prudential guidelines issued by the Department of Banking Regulation of the RBI and (b) foreign branches or

subsidiaries of Indian banks, subject to applicable prudential norms, can participate as arrangers, underwriters,

market-makers or traders for Rupee Denominated Notes issued overseas (“ECB Investor Requirements”).

ECB Investor Requirements apply in respect of the transfer of any ECB, including the transfer of any of the

Indian Issuer Notes. For further details, see “Subscription and Sale”.

The minimum average maturity period (“MAMP”) for FCNY ECBs and Rupee ECBs is three years. If

the ECB is raised from foreign equity holders and utilised for working capital purposes, general corporate

purposes or repayment of Rupee loans, the ECB MAMP will be five years; in cases where the eligible borrower

is not a foreign equity holder, and the ECB is raised for: (a) repayment of Rupee loans availed in India for

capital expenditure purposes or on-lending by non-banking financial companies (“NBFCs”) for the same

purpose, the ECB MAMP is seven years, (b) working capital purposes, general corporate purposes or repayment

of Rupee loans availed in India for purposes other than capital expenditure or on-lending by NBFCs for the

same purposes, the ECB MAMP is 10 years. No call and put option, if any, can be exercised prior to the expiry

of the MAMP.

ECB proceeds can be utilised for all purposes except as set out in a negative list, being:

(i) real estate activities;

(ii) investment in the capital markets;

(iii) equity investment;

(iv) working capital purposes, except (a) from foreign equity holder(s), or (b) where the ECB MAMP is 10

years;

(v) general corporate purposes, except (a) from foreign equity holder(s), or (b) where the ECB MAMP is 10

years;

(vi) repayment of Rupee loans – however repayment of Rupee loans through ECB is permitted if (a) the ECB

from foreign equity holder(s), (b) the Rupee loans were availed in India for capital expenditure and

where the ECB has a MAMP of 7 years, or (c) the Rupee loans were availed in India for purposes other

than capital expenditure and the ECB has a MAMP of 10 years; or

(vii) on-lending to entities for the above activities, however, NBFCs can on-lend for (a) working capital

purposes, general corporate purposes and repayment of Rupee loans availed in India for purposes other

than capital expenditure where the ECB MAMP is 10 years, or (b) repayment of Rupee loans availed in

India for purposes of capital expenditure where the ECB MAMP is seven years.

An Indian company under restructuring or in a corporate insolvency resolution process can utilised ECBs

if permitted under a resolution plan, as well as, a resolution applicant under the IBC, with prior RBI approval.

For capital expenditure loans in the manufacturing and infrastructure sectors, which are classified as non-

performing assets (a) ECBs can be raised by an eligible borrower for a one-time settlement payment to Indian

lenders in respect of such Rupee loans, or (b) a lending bank may choose to sell, by way of assignment, Rupee

loans to eligible ECB lenders, except foreign branches or overseas subsidiaries of Indian banks, in each case

subject to the ECB complying with to all-in-cost, MAMP, and other conditions under the ECB Guidelines. The

A39729228 270

all-in-cost (which includes rate of interest, other fees, charges, guarantee fees, ECA charges and expenses in

foreign currency or Indian Rupees but does not include commitment fees or payments for withholding tax in

Rupees) ceilings for (i) FCNY ECBs is 450 basis points per annum over six month London interbank offered

rate (or other applicable benchmark rate for the respective currency); and (ii) Rupee ECBs is 450 basis points

per annum over the prevailing yield of the Indian Government securities of corresponding maturity.

Indian companies raising FCNY ECB are required to follow guidelines for hedging if any, by relevant

sectoral or prudential regulators in respect of foreign currency exposure. Infrastructure space companies (being

companies in the infrastructure sector, NBFCs undertaking infrastructure financing, holding companies or core

investment companies undertaking infrastructure financing, housing finance companies and port trusts) raising

FCNY ECBs are required to (i) have a board approved risk management policy; and (ii) mandatorily hedge 70

per cent. of their FCNY ECB exposure if the MAMP is less than 5 years. ECB investors are eligible to hedge

their exposure for Rupee ECBs through permitted derivative products with AD Banks in India or through

branches or subsidiaries of Indian banks abroad or branches of foreign banks with Indian presence on a back to

back basis.

Approval Route

All ECBs falling outside the automatic route limits are considered by the RBI under the approval route.

Under the approval route, the prospective borrowers are required to send their requests to the RBI through their

AD Bank, for examination.

Creation of Security and provision of Guarantees

Under the present ECB Guidelines, the choice of security to be provided is left to the borrower. ECBs

may be secured, after approval by its AD Bank, by creation of a charge on immovable assets, movable assets,

financial securities and the issue of corporate or personal guarantees in favour of an overseas lender or a security

trustee, to secure the ECB, subject to certain conditions. In order to comply with the ECB Guidelines, inter alia:

(a) there must be a board resolution of the corporate guarantor that issues the guarantee specifying the authorised

officials who will execute the guarantee; (b) comply with the FEMA Guarantee Laws; (c) the underlying ECB

is in compliance with the extant ECB Guidelines; and (d) there exists a clause in the documents requiring

issuance of the guarantee.

Filing and regulatory requirements in relation to issuance of Indian Issuer Notes

An ECB borrower, including any Domestic Issuer, is required to obtain a loan registration number

("LRN") from the RBI before an issuance of Indian Issuer Notes is effected. For obtaining the LRN, ECB

borrowers must submit Form ECB certified by a company secretary or chartered accountant to their AD Bank.

The AD Bank is then required to forward a copy of the completed Form ECB to the RBI. Any ECB borrower,

including the Issuer, is required to submit an ECB-2 return on a monthly basis via its AD Bank to the RBI.

Procedure in relation to any change to the Terms and Conditions of the Indian Issuer Notes

Any change in the terms and conditions of the Indian Issuer Notes after obtaining the LRN, including

reduced repayment by mutual agreement between the lender and issuer, are required to be reported to

Department of Statistics and Information Management through a revised form ECB at the earliest, and in any

case not later than seven days from the changes effected. Further, the borrowers are required to report actual

ECBs transactions through Form ECB 2 filing through AD Bank on monthly basis so as to reach RBI within

seven working days from the close of month to which it relates and the changes, if any, in ECB parameters

should also be incorporated therein.

Any change in the terms and conditions of the Indian Issuer Notes after obtaining the LRN may require

the prior approval of the RBI or AD Bank, as the case may be. Certain changes (such as change of AD Bank,

cancellation of LRN, refinancing of existing ECB, conversion of ECB into equity, and security for raising ECB)

A39729228 271

may be approved by the AD Bank under a delegated authority from the RBI subject to certain conditions being

complied with. Any redemption of the Indian Issuer Notes prior to their stated maturity, including on occurrence

of an Event of Default or for taxation reasons (as further described in the Conditions) will require the prior

approval of the RBI or the AD Bank, as the case may be.

Guarantee issued by Oil and Natural Gas Corporation Limited for borrowings by an Offshore

Subsidiary Issuer being a subsidiary of Oil and Natural Gas Corporation Limited

RBI in exercise of its power under the FEMA, has issued the FEMA Guarantee Laws to regulate

acquisition and transfer of a foreign security by a person resident in India, and which includes the provision of

a guarantee by an Indian entity for its offshore JV/WOS in respect of any borrowing by such entity outside

India. The investment can be made under two routes being (i) an automatic route and (ii) an approval route.

This applies to any issuance of Notes by an Offshore Subsidiary Issuer and guaranteed by the Guarantor.

The FEMA Guarantee Laws permit an Indian entity to make an investment or undertake financial

commitment (“FC”) in overseas JV/WOS up to 400 per cent. of its own net worth predetermined in accordance

with the last audited balance sheet. “FC" means 100 per cent. of the amount of direct investment by way of

equity shares, compulsorily convertible preference shares, preference shares, loans, guarantees (including bank

guarantees) and 50 per cent. of performance guarantees issued by an Indian entity to or on behalf of its overseas

JV/WOS. However, with effect from 3 July 2014, if the aggregate FC exceeds U.S.$1 billion (or its equivalent)

in a financial year (even if this is within the 400 per cent. net worth) a prior RBI approval is required. The

FEMA Guarantee Laws also provide that the investments in unincorporated or incorporated entities overseas in

the oil sector (for exploration and drilling for oil and natural gas) by Navaratna PSUs, ONGC Videsh Limited

and Oil India Ltd may be permitted by the AD Bank, without any limit, provided such investments are approved

by the competent authorities.

The FEMA Guarantee Laws state that an Indian entity may extend a loan or guarantee only to an overseas

JV/WOS in which it has equity participation (equity shares or compulsorily convertible preference shares). The

FEMA Guarantee Laws prescribe that the Indian entity can offer any form of corporate or personal guarantee,

or collateral or guarantees or collateral can be given by the promoter company, a group company, sister concern

or associate company in India provided that (i) all FCs, including all forms of guarantees and security are within

the ceiling of 400 per cent. net worth; (ii) the guarantee is not open ended, so the amount and period of the

guarantee should be specified upfront. In the case of a performance guarantee, time specified for the completion

of the contract shall be the validity period of the related performance guarantee; and (iii) if the performance

guarantee is invoked and the ceiling for the FC is breached then the Indian entity has to seek prior RBI approval

before remitting funds from India following invocation. Based on the business requirements of the Indian

guarantor entity and legal requirements of the host country in which the JV/WOS is located, proposals from the

Indian guarantor entity for undertaking financial commitment without equity contribution in the JV/WOS may

be considered by RBI under an approval route. Indian entities cannot make direct investment in overseas entities

(set up or acquired abroad directly as a JV/WOS or indirectly as a step down subsidiary) located in the countries

identified by the FATF as non-co-operative countries and territories.

Guarantees are allowed to be rolled over under the existing FC if the only change is the validity period,

so if there is any change in the amount, interest rate, end use or any other terms and conditions then it will be

treated as a new FC.

The FEMA Guarantee Laws permit an Indian entity to issue corporate guarantees on behalf of their first

level step down operating JV/WOS, set up by their JV/WOS operating as either an operating unit or as a special

purpose vehicle under the automatic route, subject to the condition that the financial commitment of the Indian

entity is within the prescribed limit. The issuance of corporate guarantee on behalf of second generation or

subsequent level step down operating subsidiaries is considered by RBI under the approval route. However, the

A39729228 272

Indian entity should indirectly hold a 51.00 per cent. or more stake in the overseas subsidiary for which such

guarantee is intended to be issued.

Form Filings

For the purpose of making investment or undertaking FC in the overseas JV/WOS, the Indian entity

should approach an AD Bank with an application in Form ODI – Part I and prescribed enclosures or documents

for effecting such remittances.

Other

The Indian entity should not be on the RBI exporters' caution list or list of defaulters to the banking

system circulated by the RBI or Credit Information Bureau (India) Ltd. (or any other credit information

company as approved by RBI or under investigation by any investigation or enforcement agency or regulatory

body. All transactions relating to a JV/WOS should be routed through one branch of an AD Bank as designated

by the Indian entity.

Companies Act 2013

The Indian Government promulgated the Companies Act 2013 on 30 August 2013. The Companies Act

2013 intends to strengthen corporate regulation by increasing the robustness of the existing provisions and

introducing new measures, such as (i) increasing accountability of management by making independent

directors more accountable; (ii) improving corporate governance practices; (iii) enhancing disclosure norms in

relation to capital raising; (iv) enhancing audit procedures and audit accountability including establishment of

the National Financial Reporting Authority for dealing with matters relating to accounting and auditing policies

and standards; (v) increasing investor protection and activism by way of provisions relating to class action suits;

(vi) ensuring protection of minority rights including exit options; (vii) promoting e-governance initiatives; (viii)

ensuring stricter enforcement standards including establishment of the Serious Fraud Investigation Office for

investigation of frauds relating to companies and special courts for summary trial of offences under the

Companies Act 2013; (ix) a better framework for insolvency regulation, (x) making corporate social

responsibility mandatory for every company having net worth of Rs. 500 crore or more, or turnover of Rs. 1,000

crore or more or a net profit of Rs. 5 crore or more during the immediately preceding financial year, (xi)

introducing the National Company Law Tribunal and its appellate authority, the National Company Law

Appellate Tribunal, which replaces the Company Law Board, the Board for Industrial and Financial

Reconstruction and its appellate authority with the intention that all lawsuits relating to companies are made to

one body, (xii) providing rules on insider dealing, forward contracts, related party transactions and acceptance

of deposits and (xiii) the implementation of a fixed and variable legislation model with various provisions of

the Companies Act 2013 delegating rule making authority to the Indian Government.

The Indian Parliament, from time to time, passes amendments to the Companies Act 2013, seeking to

facilitate, inter alia, (i) promotion of ease of doing business; (ii) de-clogging of National Company Law

Tribunal; (iii) strengthening of corporate governance standards and enforcement; and (iv) enhanced compliance

by corporates.

The Insolvency and Bankruptcy Code, 2016 (“IBC”)

The IBC is effective in India since it was passed by the Lok Sabha on 5 May 2016, the Rajya Sabha on

11 May 2016, received the assent of the President and was notified in the Official Gazette on 28 May 2016. The

IBC primarily consolidates the existing insolvency law, inter alia, relating to companies and corporate entities

with the objective of providing clarity and consistency in the treatment of all the stakeholders in the insolvency

process. The IBC classifies creditors into financial creditors and operational creditors, which includes creditors

in respect of financial loans for interest and loans arising from the operational nature of the debtor, respectively.

A39729228 273

The IBC enables the appointment of specialised insolvency professionals to assist companies and

corporate entities through the insolvency process. The IBC provides a 180-day timeline which may be extended

by an additional 90 days when dealing with insolvency resolution applications. Subsequently, the insolvency

resolution plan prepared by insolvency professionals was required to be approved by 66.00 per cent. of the

financial creditors and further sanction from the adjudicating authority and, if rejected, the adjudicating

authority will pass an order for liquidation. The National Company Law Tribunal is the adjudicating authority

with jurisdiction over companies and limited liability entities. The objective of the IBC is to promote

entrepreneurship, availability of credit, and balance the interests of all stakeholders by consolidating and

amending the laws relating to reorganisation and insolvency resolution of corporate persons, partnership firms

and individuals in a timely manner and for maximisation of value of assets of such persons and matters

connected therewith or incidental thereto. Liquidation of Indian companies also falls under the IBC.

The Indian parliament from time to time amends the IBC. Recently, the Insolvency and Bankruptcy

Code (Amendment) Act, 2019 was passed on 6 August 2019 which (i) casts responsibility upon the National

Company Law Tribunal to accord reasons for rejection or admission of a corporate insolvency resolution

initiation application filed by financial creditors, if such application has neither been rejected not accepted

within 14 days; (ii) mandatorily requires the completion of insolvency resolution processes of corporate debtors

within 330 days; and (iii) provides that the resolution plan approved by National Company Law Tribunal binds

the Central Government, State Government or any other local authority to whom debt is owed by the corporate

debtor.

Essential Commodities Act, 1955 (“EC Act”)

The EC Act vests the central government with the authority to issue notifications for controlling the

production, supply and distribution of certain essential commodities contained in schedule to the EC Act, which

include petroleum and petroleum products. The EC Act gives powers to the central government to issue orders

from time to time for maintaining or increasing supplies of any essential commodity or for securing their

equitable distribution and availability of the essential commodities at fair prices.

Explosives Act, 1884 (the “Explosives Act”)

Under the Explosives Act, the Indian Government has the power to regulate the manufacture, possession,

use, sale, transport, importation and exportation of explosives and grant of licence for the same activities. The

Indian Government may prohibit the manufacture, possession or importation of especially dangerous

explosives. Any contravention of the Explosives Act or rules made under it, being the Explosives Rules, 1983,

may lead to an arrest without warrant and imprisonment of up to three years, including a fine which may extend

up to Rs. 5,000, or both.

Intellectual Property Laws

The Trade Marks Act, 1999 (“Trademarks Act”), the Copyright Act, 1957 and the Patents Act, 1970,

among other enactments, govern the law in relation to intellectual property, including trade marks for goods

and services, original literary, dramatic, musical and artistic works, and inventions.

The Trademarks Act seeks to amend and consolidate the law relating to trademarks, to provide for

registration and better protection of goods and services trademarks and to prevent the use of fraudulent

trademarks. A trademark registration is valid for a period of ten years. The Trademarks Act prescribes the

conditions, procedure and duration of trade mark registration. It governs the assignment, transmission and usage

of trademarks and also provides for penalties arising from violation of the provisions of the Trademarks Act.

A39729228 274

TAXATION

The information provided below does not purport to be a comprehensive description of all tax considerations

which may be relevant to a decision to purchase the Notes. Neither these statements nor any other statements

in this Offering Circular are to be regarded as advice on the tax position of any holder of the Notes or of any

person acquiring, selling or otherwise dealing with the Notes or on any tax implications arising from the

acquisition, sale or other dealings in respect of the Notes. The statements do not purport to be a comprehensive

description of all the tax considerations that may be relevant to a decision to purchase, own or dispose of the

Notes and do not purport to deal with the tax consequences applicable to all categories of investors, some of

which (such as dealers in securities) may be subject to special rules.

Prospective purchasers of Notes are advised to consult their own tax advisers as to the tax consequences of the

purchase, ownership and disposition of Notes, including the effect of any state or local taxes, under the tax laws

applicable in India or the country of which they are residents.

Prospective investors must inform themselves as to any tax laws or regulations in force relating to the purchase,

holding or disposition of the Notes in their country of residence, citizenship or in which they purchase, hold or

dispose of the Notes.

Indian Taxation

Tax in respect of issuance of Indian Issuer Notes (i.e. being Rupee Denominated Notes and FCNY

Notes) by a Domestic Issuer

Taxation of Interest

Interest on Indian Issuer Notes issued by a Domestic Issuer may not be subject to income tax in India if

the proceeds of the issuance of such Indian Issuer Notes are used for the purposes of business carried on by the

Domestic Issuer outside India. If the proceeds of the issuance are used for the purpose of a Domestic Issuer’s

business in India, non-resident investors will be subject to income tax on the interest paid on the Indian Issuer

Notes. As of the date of this Offering Circular, the rate of tax for interest paid on Indian Issuer Notes under the

Income-tax Act, 1961 (the “IT Act”) is 5 per cent. (plus applicable surcharge and Cess on income tax), provided

the Indian Issuer Notes are issued before 1 July 2020.

The rates of tax will stand reduced if the beneficial recipient is a resident of a country with which the

Indian Government has entered into an agreement for granting relief of tax or for avoidance of double taxation

(“Tax Treaty”) which provide for taxation of income by way of interest arising in India at a rate lower than that

stated above, and the provisions of such Tax Treaty are satisfied. The Noteholder could be required to provide

certain documents or other information as prescribed by law to apply the lower tax rate in accordance with the

applicable Tax Treaty.

Withholding of Taxes

Where the interest payable on the Indian Issuer Notes is subject to taxation in India, there is a requirement

to withhold tax at the applicable rate for Indian Issuer Notes, subject to any lower rate of tax specified in an

applicable Tax Treaty, depending on the legal status of the non-resident investor and its taxable income in India.

As of the date of this Offering Circular interest payable on the Indian Issuer Notes to non-residents is

subject to a withholding tax in India at the rate of 5 per cent. (plus applicable surcharge and Cess on income

tax) provided the Indian Issuer Notes are issued before 1 July 2020. The above rate is subject to the applicability

of a lower rate in accordance with the applicable Tax Treaty.

Pursuant to the Terms and Conditions of the Notes, all payments of, or in respect of, principal and interest

on the Indian Issuer Notes, will be made free and clear of and without withholding or deduction on account of

A39729228 275

any present or future taxes within India unless it is required by law, in which case, pursuant to Condition 8 of

the Terms and Conditions of the Notes, a Domestic Issuer will pay additional amounts as may be necessary in

order that the net amounts received by the Noteholders after the withholding or deduction shall equal the

respective amounts which would have been receivable in respect of the Indian Issuer Notes in the absence of

the withholding or deduction, subject to certain exceptions. With respect to interest on the Indian Issuer Notes

that is not subject to taxes in India (where the proceeds of the issuance of the Indian Issuer Notes are used for

the purposes of business carried on by a Domestic Issuer outside India), a Domestic Issuer may be required to

apply annually for an exemption from withholding tax under section 195(2) of the IT Act or obtain a chartered

accountant’s certificate in Form 15CB pursuant to Rule 37BB of the Income Tax Rules, 1962, as amended.

In the event that the tax withheld from interest on the Indian Issuer Notes payable to a non-resident

investor is determined to be in excess of, or less than, its ultimate Indian tax liability on such interest, the non-

resident Investor will be entitled to a refund of, or obligated to pay, such differential income tax, as the case

may be, subject to and in accordance with the provisions of the IT Act.

Taxation of Gains arising on Disposal

Any gains arising to a non-resident Noteholder from disposal of the Indian Issuer Notes held (or deemed

as held) as a capital asset will be chargeable to income tax in India if the Indian Issuer Notes are regarded as

property situated in India. A non-resident Noteholder generally will not be chargeable to income tax in India

from disposal of the Indian Issuer Notes held as a capital asset provided that the Indian Issuer Notes are regarded

as a capital asset situated outside India. The issue as to where the Indian Issuer Notes should properly be

regarded as being situate is not free from doubt and will depend upon the view taken by the Indian tax

authorities, which may treat the Indian Issuer Notes as being situated in India, where the Issuer is incorporated

and resident in India.

If the Indian Issuer Notes are regarded as situated in India by the Indian tax authorities, upon disposition

of an Indian Issuer Notes the following capital gains tax would apply:

(a) a non-resident investor who has held the Indian Issuer Notes for a period of more than 36 months (long

term capital asset) immediately preceding the date of their disposal, would be subject to long term capital

gain tax at the rate of 10.00 per cent. (plus applicable surcharge and cess) in accordance with the

provisions of the IT Act. These rates are subject to any lower rate provided for in the applicable Tax

Treaty;

(b) a non-resident investor who has held the Indian Issuer Notes for 36 months or less (short term capital

asset) immediately preceding the date of their disposal, will be liable to pay short term capital gains tax

at a rate of up to 40.00 per cent. of capital gains (plus applicable surcharge and cess), depending on the

legal status of the non-resident investor, and his or her taxable income in India, subject to any lower rate

provided for by an applicable Tax Treaty;

(c) any income arising to a non-resident investor from a transfer of the Indian Issuer Notes held as stock-in-

trade will be considered as business income. Business income will be subject to income tax in India only

to the extent, it is attributable to a “business connection” in India or, where a Tax Treaty applies, to a

“permanent establishment” of the non-resident investor in India. A non-resident investor will be liable

to pay income tax on such business income at a rate of up to 40.00 per cent (plus applicable surcharge

and cess), depending on the legal status of the non-resident investor and his or her taxable income in

India, subject to any beneficial provision of an applicable Tax Treaty;

(d) any gains arising pursuant to any transfer of a capital asset being a Rupee Denominated Note made by a

non-resident Noteholder on a recognised stock exchange located in any International Financial Services

A39729228 276

Centre (including India International Exchange (IFSC) Limited), are not subject to tax in India, provided

that the consideration for such transfer is paid or payable in foreign currency; and

(e) capital gains, if any, arising pursuant to any transfer made outside India by a non-resident to another

non-resident, of a capital asset being Rupee Denominated Notes of a Domestic Issuer issued outside of

India, are not subject to tax in India.

If applicable, under the tax law, tax shall be withheld by the person making any payment to a non-

resident on long-term capital gains at 10.00 per cent. (plus applicable surcharge and cess) and short-term capital

gains at 30.00 per cent. or 40 per cent. (plus applicable surcharge and cess), depending on the legal status of the

recipient of income, subject to any lower rate provided for by an applicable Tax Treaty. Tax payable shall be

computed in such manner as prescribed in this regard under the IT Act. For the purpose of tax withholding, the

non-resident Noteholders shall provide the permanent account number (“PAN”) allotted by the Indian Income

Tax Department and all prescribed information/documents, including a tax residency certificate (issued by the

tax authorities of the country/territory of which the investor is a tax resident) for claiming the tax treaty benefits.

If the investor does not have a PAN allotted by the Indian Income Tax Department, the tax identification number

issued by the authorities of the country/territory of which the investor is a tax resident, may be submitted along

with other prescribed information or documents, such as, tax residency certificate, investor’s name, email

address, contact number and address in the country/territory of tax residence.

Potential investors should, in any event, consult their own tax advisers on the tax consequences, as well as the

computation of tax liability in India as a result of transfer of the Notes.

Tax in respect of Payment on the Guarantee by the Guarantor in respect of Notes issued by an Offshore

Subsidiary Issuer

The following summary describes the Indian withholding tax consequences applicable to the payments

by any Offshore Subsidiary Issuer and the Guarantor to Noteholders who are not tax residents in India and who

do not hold Notes in connection with an Indian trade or business or permanent establishment in India.

Taxation of Interest and Withholding on Notes issued by an Offshore Subsidiary Issuer

Payments of interest made by an Offshore Subsidiary Issuer on the Notes to Noteholders should not be

subject to income or withholding tax in India, if the Offshore Subsidiary Issuer intends to use all the proceeds

of the Notes for its business purposes outside India. In the event the Guarantor is required to pay interest and

principal on the Notes under the guarantee then, although the position is not free from doubt, such payments

may not be subject to withholding tax in India.

However, in the event a non-resident Noteholder (not being a company) is held to be liable to pay tax in

India on interest received on the Notes from the Guarantor, then such interest payments received will be subject

to withholding tax at the rate of 30 per cent. (plus applicable surcharge and cess). If the Noteholder is a foreign

company, withholding tax at a rate of 40 per cent. (plus applicable surcharge and cess) may be imposed, and

this rate may apply even if the foreign company has a permanent establishment (“PE”) in India and the interest

received on the Notes is effectively connected to such PE. In other cases, a withholding tax rate of 40 per cent.

(plus applicable surcharge and cess) may apply.

The rate of taxation could be reduced if the beneficial recipient of an interest payment on the Notes is a

resident of a country/territory that has entered into a Tax Treaty with the Indian Government that provides for

taxation of income at a reduced rate, subject to certain conditions being fulfilled, including furnishing a valid

tax residency certificate and prescribed particulars.

A39729228 277

Taxation of gains arising from disposal of the Notes issued by an Offshore Subsidiary Issuer

Subject to any relief available under a Tax Treaty, gains arising from disposals of capital assets situated

in India are generally subject to income tax in India. However, since the Notes will be issued by the Offshore

Subsidiary Issuer, which is a non-Indian entity, the Notes will be regarded as being situated outside of India.

Consequently, any capital gains arising on a transfer of the Notes by a non-resident holder of the Notes should

not be taxable in India.

Wealth Tax

As of the date of this Offering Circular, no wealth tax is payable at present in relation to the Notes.

Estate Duty

As of the date of this Offering Circular, no estate duty is payable at present in relation to the Notes. There

are no inheritance taxes or succession duties currently imposed in respect of the Notes held outside India.

Gift Tax

As of the date of this Offering Circular, no gift tax is payable in relation to the Notes in India.

However, in the event that any resident in India is permitted to acquire any of the Notes, then under the

IT Act, in respect of any transfer of Notes by a resident investor to another investor or vice-versa, where the

fair market value of the Notes exceeds the consideration for such transfer by more than Rs. 50,000, such excess

would be taxable as income of the transferee, subject to certain specific exemptions available under the IT Act

which may or may not apply.

Stamp Duty

A transfer of the Notes outside India will not give rise to any Indian stamp duty liability unless brought

into India. Stamp duty would be payable if the Notes are brought into India for enforcement or for any other

purpose. This stamp duty will have to be paid within a period of three months from the date the Notes are first

received in India (including via electronic mode). The amount of stamp duty payable would depend on the

applicable Stamp Act of the relevant state of India into which the Notes are brought.

General anti-avoidance rule (“GAAR”)

GAAR is applicable from 1 April 2018. As per the notification dated 23 September 2013 issued by the

Central Board of Direct Taxes, provisions for GAAR have been introduced by the Finance Act, 2012, and apply

in respect of financial years commencing on or after from 1 April 2017. The GAAR provisions are intended to

catch arrangements declared as “impermissible avoidance arrangements”, which are defined under Section 96

of the IT Act, as any arrangement, the main purpose of which is to obtain a tax benefit and which: (i) creates

rights, or obligations, which are not ordinarily created between persons dealing at arm’s length; (ii) results,

directly or indirectly, in misuse, or abuse, of the provisions of the IT Act; (iii) lacks commercial substance or is

deemed to lack commercial substance, as per Section 97 of the IT Act, in whole or in part; or (iv) is entered

into, or carried out, by means, or in a manner, which are not ordinarily employed for bona fide purposes. The

onus to prove that the transaction is an “impermissible avoidance arrangement” is on the tax authorities. If the

GAAR provisions are invoked, then the tax authorities have wide powers, including the denial of tax benefit or

the denial of a benefit under a tax treaty. As the taxation system is expected to undergo a significant overhaul,

the consequential effects on the Company cannot be determined as of the date of this Offering Circular and

there can be no assurance that such effects would not adversely affect the Company’s business, future financial

performance or the trading price of the Notes.

A39729228 278

CLEARANCE AND SETTLEMENT ARRANGEMENTS

The information set out below is subject to any change in, or reinterpretation of, the rules, regulations and

procedures of Euroclear and Clearstream, Luxembourg or any other clearing system (together, the “Clearing

Systems”) currently in effect. Investors wishing to use the facilities of any of the Clearing Systems are advised

to confirm the continued applicability of the rules, regulations and procedures of the relevant Clearing System.

None of the Issuers, the Guarantor, any other party to the Agency Agreement, the Arrangers nor any Dealer

will have any responsibility or liability for any aspect of the records relating to, or payments made on account

of, beneficial ownership interests in the Notes held through the facilities of any Clearing System or for

maintaining, supervising or reviewing any records relating to, or payments made on account of, such beneficial

ownership interests.

Clearing Systems

The relevant Pricing Supplement will specify the Clearing System(s) applicable for each Series.

Euroclear and Clearstream, Luxembourg

Euroclear and Clearstream, Luxembourg each holds securities for participating organisations and

facilitates the clearance and settlement of securities transactions between their respective participants through

electronic book-entry changes in accounts of such participants. Euroclear and Clearstream, Luxembourg

provide to their respective participants, among other things, services for safekeeping, administration, clearance

and settlement of internationally-traded securities and securities lending and borrowing. Euroclear and

Clearstream, Luxembourg participants are financial institutions throughout the world, including underwriters,

securities brokers and dealers, banks, trust companies, clearing corporations and certain other organisations.

Indirect access to Euroclear or Clearstream, Luxembourg is also available to others, such as banks, brokers,

dealers and trust companies which clear through or maintain a custodial relationship with a Euroclear or

Clearstream, Luxembourg participant, either directly or indirectly.

Distributions of principal and interest with respect to book-entry interests in the Notes held through

Euroclear or Clearstream, Luxembourg will be credited, to the extent received by any Paying Agent, to the cash

accounts of Euroclear or Clearstream, Luxembourg participants in accordance with the relevant Clearing

System’s rules and procedures.

Registration and Form

Bearer Notes

The relevant Issuer may make applications to Euroclear and Clearstream, Luxembourg for acceptance

in their respective book-entry systems in respect of any Series of Bearer Notes. In respect of Bearer Notes, a

Temporary Bearer Global Note and/or a Permanent Bearer Global Note will be deposited with a Common

Depositary. Transfers of interests in a Temporary Bearer Global Note or a Permanent Bearer Global Note will

be made in accordance with the normal market debt securities operating procedures of Euroclear and

Clearstream, Luxembourg. Each Global Note will have an International Securities Identification Number

(“ISIN”) and a Common Code, as the case may be. Investors in Notes of such Series may hold their interests

in a Global Note through Euroclear or Clearstream, Luxembourg, as the case may be.

Registered Notes

The relevant Issuer may make applications to Euroclear and Clearstream, Luxembourg for acceptance

in their respective book-entry systems in respect of the Notes to be represented by a Global Certificate. Transfers

of interests in a Global Certificate will be made in accordance with the normal market debt securities operating

procedures of Euroclear or Clearstream, Luxembourg, as the case may be. Each Global Certificate will have an

A39729228 279

ISIN and a Common Code. Investors in Notes of such Series may hold their interests in a Global Certificate

only through Euroclear or Clearstream, Luxembourg, as the case may be.

All Registered Notes will initially be in the form of a Global Certificate. Individual Certificates will only

be available in the amounts specified in the applicable Pricing Supplement.

Transfers of Registered Notes

Transfers of interests in Global Certificates within Euroclear and Clearstream, Luxembourg will be in

accordance with the usual rules and operating procedures of the relevant clearing system. Beneficial interests

in a Global Certificate may only be held through Euroclear or Clearstream, Luxembourg.

Individual Certificates

Registration of title to Registered Notes in a name other than a depositary or its nominee for Euroclear

and Clearstream, Luxembourg will be permitted only in the circumstances set forth in “Form of the Notes –

Registered Notes”. In such circumstances, the relevant Issuer will cause sufficient individual Certificates to be

executed and delivered to the Registrar for completion, authentication and despatch to the relevant

Noteholder(s). A person having an interest in a Global Certificate must provide the Registrar with a written

order containing instructions and such other information as the relevant Issuer and the Registrar may require to

complete, execute and deliver such individual Certificates.

Clearance and Settlement

The information set out below is subject to any change in or reinterpretation of the rules, regulations and

procedures of Euroclear or Clearstream, Luxembourg currently in effect. The information in this section

concerning the Clearing Systems has been obtained from sources that the relevant Issuer and the Guarantor

believe to be reliable, but none of the Issuers, the Guarantor, the Arrangers, any Dealer, the Trustee, any Agent

or any person who controls any of them, or any of their respective officers, employees, advisers or agents, or

any affiliate of any such person, takes any responsibility for the accuracy thereof. Investors wishing to use the

facilities of any of the Clearing Systems are advised to confirm the continued applicability of the rules,

regulations and procedures of the relevant Clearing System. None of the Issuers, the Guarantor, the Trustee, the

Agents or any other party to the Agency Agreement or any person who controls any of them, or any of their

respective officers, employees, advisers or agents, or any affiliate of any such person, will have any

responsibility or liability for any aspect of the records relating to, or payments made on account of, beneficial

ownership interests in the Notes held through the facilities of any Clearing System or for maintaining,

supervising or reviewing any records relating to, or payments made on account of, such beneficial ownership

interests.

A39729228 280

SUBSCRIPTION AND SALE

The Dealers have, in a programme agreement dated 27 August 2019 (as amended, restated, modified

and/or supplemented from time to time, the “Programme Agreement”), agreed with the Issuers and the

Guarantor a basis upon which they or any of them may from time to time agree to subscribe the Notes. Any

such agreement will extend to those matters stated under the sections entitled “Form of the Notes” and “Terms

and Conditions of the Notes”. In the Programme Agreement, the Issuers (failing which (in the case of

Guaranteed Notes), the Guarantor) have agreed to reimburse the Dealers for certain of their expenses in

connection with the establishment of the Programme and the issue of Notes under the Programme and to

indemnify the Dealers against certain liabilities incurred by them in connection therewith. The Programme

Agreement entitles the Dealers to terminate any agreement that they make to subscribe Notes in certain

circumstances prior to payment for such Notes being made to the relevant Issuer. The Notes may also be sold

by the relevant Issuer through the Dealers, acting as the relevant Issuer’s agents. The Dealers may also offer

and sell Notes through certain of their affiliates.

In order to facilitate the offering of any Tranche of the Notes, a nominated Dealer participating in the

offering of the Tranche may engage in transactions that stabilise, maintain or otherwise affect, which support

the market price of the relevant Notes during and after the offering of the Tranche. Specifically, such persons

may over-allot or create a short position in the Notes for their own account by selling more Notes than have

been sold to them by the relevant Issuer. Such persons may also elect to cover any such short position by

purchasing Notes in the open market. In addition, such persons may stabilise or maintain the price of the Notes

by bidding for or purchasing Notes in the open market and may impose penalty bids, under which selling

concessions allowed to syndicate members or other broker-dealers participating in the offering of the Notes are

reclaimed if Notes previously distributed in the offering are repurchased in connection with stabilisation

transactions or otherwise. The effect of these transactions may be to stabilise or maintain the market price of

the Notes at a level higher than that which might otherwise prevail in the open market. The imposition of a

penalty bid may also affect the price of the Notes to the extent that it discourages resales thereof. No

representation is made as to the magnitude or effect of any such stabilising or other transactions. Such

transactions, if commenced, may be discontinued at any time, and must be brought to an end after a limited

period. Under United Kingdom laws and regulations stabilising activities may only be carried on by the

stabilising manager (or any person acting for the stabilising manager) named in the applicable Pricing

Supplement and only for a limited period following the Issue Date of the relevant Tranche of Notes.

If a jurisdiction requires that an offering be made by a licensed broker or dealer and the underwriters or

any affiliate of the underwriters is a licensed broker or dealer in that jurisdiction, such offering shall be deemed

to be made by the underwriters or such affiliate on behalf of the relevant Issuer in such jurisdiction.

United States

The Notes and the Guarantee have not been and will not be registered under the Securities Act and,

subject to certain exceptions, may not be offered or sold within the United States. Each Dealer has agreed, and

each further Dealer appointed under the Programme will be required to agree, that it will not offer or sell any

Notes within the United States, except as permitted by the Programme Agreement. The Notes and the Guarantee

are being offered and sold outside of the United States in reliance on Regulation S.

The Notes in bearer form are subject to U.S. tax law requirements and may not be offered, sold or

delivered within the United States or its possessions or to a United States person, except in certain transactions

permitted by U.S. Treasury regulations. Terms used in this paragraph have the meanings given to them by the

U.S. Internal Revenue Code of 1986, as amended (the “Code”) and regulations thereunder. The applicable

Pricing Supplement will identify whether either TEFRA C or TEFRA D or any successor rules in substantially

A39729228 281

the same form that are applicable for purposes of Section 4701 of the Code apply or whether TEFRA is not

applicable.

In addition, until 40 days after the commencement of the offering of any Series of Notes and the

Guarantee, an offer or sale of such Notes or Guarantee within the United States by any dealer (whether or not

participating in the offering) may violate the registration requirements of the Securities Act if such offer or sale

is made otherwise than in accordance with an available exemption from registration under the Securities Act.

This Offering Circular has been prepared by the Issuers for use in connection with the offer and sale of

the Notes outside the United States. The Issuers and the Dealers reserve the right to reject any offer to purchase

the Notes, in whole or in part, for any reason. This Offering Circular does not constitute an offer to any person

in the United States. Distribution of this Offering Circular by any non-U.S. person outside the United States to

any U.S. person or to any other person within the United States, is unauthorised and any disclosure without the

prior written consent of the Issuers of any of its contents to any such U.S. person or other person within the

United States, is prohibited.

Each issuance of Index Linked Notes or Dual Currency Notes shall be subject to such additional U.S.

selling restrictions as the relevant Issuer, (in the case of Guaranteed Notes) the Guarantor and the relevant

Dealer may agree as a term of the issuance and purchase of such Notes, which additional selling restrictions

shall be set out in the applicable Pricing Supplement.

Prohibition of Sales to EEA Retail Investors

Unless the Pricing Supplement in respect of any Notes specifies “Prohibition of Sales to EEA Retail

Investors” as “Not Applicable”, each Dealer has represented and agreed, and each further Dealer appointed

under the Programme will be required to represent and agree, that it has not offered, sold or otherwise made

available and will not offer, sell or otherwise make available any Notes which are the subject of the offering

contemplated by this Offering Circular as completed by the Pricing Supplement in relation thereto to any retail

investor in the European Economic Area. For the purposes of this provision:

(a) the expression “retail investor” means a person who is one (or more) of the following:

(i) a retail client as defined in point (11) of Article 4(1) of Directive 2014/65/EU (as amended,

“MiFID II”); or

(ii) a customer within the meaning of Directive (EU) 2016/97 (the “Insurance Distribution

Directive”), where that customer would not qualify as a professional client as defined in point

(10) of Article 4(1) of MiFID II; or

(iii) not a qualified investor as defined in Regulation (EU) 2017/1129 (the “Prospectus Regulation”);

and

(b) the expression “an offer” includes the communication in any form and by any means of sufficient

information on the terms of the offer and the Notes to be offered so as to enable an investor to decide to

purchase or subscribe for the Notes.

If the Pricing Supplement in respect of any Notes specifies “Prohibition of Sales to EEA Retail Investors”

as “Not Applicable”, in relation to each Member State of the European Economic Area, each Dealer has

represented and agreed, and each further Dealer appointed under the Programme will be required to represent

and agree, that it has not made and will not make an offer of Notes which are the subject of the offering

contemplated by this Offering Circular as completed by the pricing supplement in relation thereto to the public

in that Member State except that it may make an offer of such Notes to the public in that Member State:

(A) if the pricing supplement in relation to the Notes specifies that an offer of those Notes may be

made other than pursuant to Article 1(4) of the Prospectus Regulation in that Member State (a

A39729228 282

“Non-exempt Offer”), following the date of publication of a prospectus in relation to such Notes

which has been approved by the competent authority in that Member State or, where appropriate,

approved in another Member State and notified to the competent authority in that Member State,

provided that any such prospectus has subsequently been completed by the pricing supplement

contemplating such Non-exempt Offer, in accordance with the Prospectus Regulation, in the

period beginning and ending on the dates specified in such prospectus or pricing supplement, as

applicable and the relevant Issuer and (in the case of Guaranteed Notes) the Guarantor has

consented in writing to its use for the purpose of that Non-exempt Offer;

(B) at any time to any legal entity which is a qualified investor as defined in the Prospectus

Regulation;

(C) at any time to fewer than 150 natural or legal persons (other than qualified investors as defined

in the Prospectus Regulation), subject to obtaining the prior consent of the relevant Dealer or

Dealers nominated by the Issuer for any such offer; or

(D) at any time in any other circumstances falling within Article 1(4) of the Prospectus Regulation,

provided that no such offer of Notes referred to in (B) to (D) above shall require any Issuer or any Dealer

to publish a prospectus pursuant to Article 3 of the Prospectus Regulation or supplement a prospectus pursuant

to Article 23 of the Prospectus Regulation.

For the purposes of this provision, the expression an “offer of Notes to the public” in relation to any

Notes in any Member State means the communication in any form and by any means of sufficient information

on the terms of the offer and the Notes to be offered so as to enable an investor to decide to purchase or subscribe

for the Notes and the expression “Prospectus Regulation” means Regulation (EU) 2017/1129.

United Kingdom

Each Dealer has represented and agreed, and each further Dealer appointed under the Programme will

be required to represent and agree, that:

(a) in relation to any Notes which have a maturity of less than one year, (i) it is a person whose ordinary

activities involve it in acquiring, holding, managing or disposing of investments (as principal or agent)

for the purposes of its business and (ii) it has not offered or sold and will not offer or sell any Notes other

than to persons whose ordinary activities involve them in acquiring, holding, managing or disposing of

investments (as principal or as agent) for the purposes of their businesses or who it is reasonable to

expect will acquire, hold, manage or dispose of investments (as principal or agent) for the purposes of

their businesses where the issue of the Notes would otherwise constitute a contravention of Section 19

of the Financial Services and Markets Act 2000 (“FSMA”) by the relevant Issuer;

(b) it has only communicated or caused to be communicated and will only communicate or cause to be

communicated an invitation or inducement to engage in investment activity (within the meaning of

Section 21 of the FSMA) received by it in connection with the issue or sale of any Notes in circumstances

in which Section 21(1) of the FSMA does not apply to the relevant Issuer or (in the case of Guaranteed

Notes) the Guarantor; and

(c) it has complied and will comply with all applicable provisions of the FSMA with respect to anything

done by it in relation to any Notes in, from or otherwise involving the United Kingdom.

Republic of Italy

The offering of the Notes has not been registered with the Commissione Nazionale per le Società e la

Borsa (“CONSOB”) pursuant to Italian securities legislation and, accordingly, no Notes may be offered, sold

or delivered, nor may copies of this Offering Circular or of any other document relating to any Notes be

A39729228 283

distributed in Italy, except, in accordance with any Italian securities, tax and other applicable laws and

regulations.

Each Dealer has represented and agreed and each further Dealer appointed under the Programme will be

required to represent and agree that it has not offered, sold or delivered, and will not offer, sell or deliver any

Notes or distribute any copy of this Offering Circular or any other document relating to the Notes in Italy except:

(a) to qualified investors (investitori qualificati), as defined pursuant to Article 100 of Legislative Decree

no. 58 of 24 February 1998 (the “Financial Services Act”) and Article 34-ter, paragraph 1, letter (b) of

CONSOB regulation No. 11971 of 14 May 1999 (the “Issuers Regulation”), all as amended from time

to time; or

(b) in other circumstances which are exempted from the rules on public offerings pursuant to Article 100 of

the Financial Services Act and Issuers Regulation.

In any event, any offer, sale or delivery of the Notes or distribution of copies of this Offering Circular

or any other document relating to the Notes in Italy under paragraphs (a) or (b) above must be:

(i) made by an investment firm, bank or financial intermediary permitted to conduct such activities

in Italy in accordance with the Financial Services Act, Legislative Decree No. 385 of 1 September

1993 (the “Banking Act”) and CONSOB Regulation No. 20307 of 15 February 2018, all as

amended from time to time;

(ii) in compliance with Article 129 of the Banking Act, as amended from time to time, and the

implementing guidelines of the Bank of Italy, as amended from time to time; and

(iii) in compliance with any other applicable laws and regulations, including any limitation or

requirement which may be imposed from time to time by CONSOB or the Bank of Italy or other

competent authority.

Investors should note that, in accordance with Article 100-bis of the Financial Services Act, where no

exemption from the rules on public offerings applies under paragraphs (a) and (b) above, the subsequent

distribution of the Notes on the secondary market in Italy must be made in compliance with the public offer and

the prospectus requirement rules provided under the Financial Services Act and the Issuers Regulation.

Furthermore, where no exemption from the rules on public offerings applies, the Notes which are initially

offered and placed in Italy or abroad to professional investors only but in the following year are "systematically"

distributed on the secondary market in Italy become subject to the public offer and the prospectus requirement

rules provided under the Financial Services Act and Issuers Regulation. Failure to comply with such rules may

result in the sale of such Notes being declared null and void and in the liability of the intermediary transferring

the financial instruments for any damages suffered by the purchasers of Notes who are acting outside of the

course of their business or profession.

India

Each Dealer has represented and agreed and each further Dealer appointed under the Programme will be

required to represent and agree that (a) this Offering Circular has not been and will not be registered, produced

or published as an offer document (whether as a prospectus or statement in lieu of prospectus in respect of a

public offer or an information memorandum or private placement offer letter or other offering material in respect

of a private placement under the Companies Act 2013, as amended from time to time and the rules framed

thereunder or any other applicable Indian laws) with the Registrar of Companies, the Securities and Exchange

Board of India, any Indian stock exchange or any other statutory or regulatory body of like nature in India,

except any information from part of this Offering Circular which is mandatorily required to be disclosed or filed

in India under any applicable Indian laws; (b) the Notes have not been and will not be offered or sold in India

A39729228 284

by means of this Offering Circular or any document other than to persons permitted to acquire the Notes under

Indian law, whether as principal or agent, and (c) neither this Offering Circular nor any other offering document

or material relating to the Notes has been and nor will it be circulated or distributed, directly or indirectly, to

any person or the public in India or otherwise generally distributed or circulated in India which would constitute

an advertisement, invitation, offer, sale or solicitation of an offer to subscribe for or purchase any securities in

violation of applicable Indian laws for the time being in force. The Notes have not been offered or sold and will

not be offered or sold in India in circumstances which would constitute an offer of securities (whether to the

public or by way of private placement) within the meaning of the Companies Act 2013 or any other applicable

Indian laws for the time being in force. The Notes will not be offered, directly or indirectly, in Gujarat

International Finance Tec-City IFSC, India (“GIFT IFSC”) or to, or for the account or benefit of any person

who is not a resident in GIFT IFSC. Each Dealer represents and agrees that in relation to any issuance of Indian

Issuer Notes, this Offering Circular or any other material relating to such Indian Issuer Notes has only been

circulated or distributed to investors meeting the ECB Investor Requirements. Other requirements as specified

by the RBI from time to time may apply.

Eligibility of holders of the Notes

This Offering Circular has not been and will not be reviewed or approved by any regulatory authority in

India or by any Indian stock exchange. Holders and beneficial owners of the Notes shall be responsible for

compliance with restrictions on the ownership of the Notes imposed from time to time by applicable laws or by

any regulatory authority or otherwise. In this context, holders and beneficial owners of Notes shall be deemed

to have acknowledged, represented and agreed that such holders and beneficial owners are eligible to purchase

the Notes under applicable laws and regulations and are not prohibited under any applicable law or regulation

from acquiring, owning or selling the Notes. Potential investors should seek independent advice and verify

compliance prior to any purchase of the Notes.

Disclosure of information relating to holders of Notes

The holders and beneficial owners of Indian Issuer Notes shall be deemed to confirm that for so long as

they hold any Indian Issuer Notes they will meet the ECB Investor Requirements and the ECB Guidelines.

Further, all Noteholders represent and agree that the Indian Issuer Notes will not be offered or sold on the

secondary market to any person who does not meet the ECB Investor Requirements and comply with ECB

Guidelines.

In relation to any issuance of Notes, the holder and beneficial owners represent and agree that they will

provide all information and details about themselves to the Issuer, to enable the Issuer to provide such

information to the RBI or any other statutory or regulatory authority in India as and when such information is

required.

The holders and beneficial owners of Notes will provide all information and details that they have or can

procure about any subsequent transferee Noteholders (and shall provide all assistance in relation thereto) to the

Issuer so as to enable the Issuer to obtain the details of the transferee Noteholder or any other information

pertaining to such transferee Noteholders to enable the Issuer to provide such information to the RBI or any

other statutory or regulatory authority in India as and when such information is required.

To comply with applicable laws and regulations, the Issuer or its duly appointed agent may from time to

time request Euroclear or Clearstream, Luxembourg to provide them with details of the accountholders within

Euroclear or Clearstream, Luxembourg, as may be appropriate, that hold the Notes and the number of Notes

held by each such accountholder. Euroclear or Clearstream, Luxembourg participants which are holders of the

Notes or intermediaries acting on behalf of such Noteholder would be deemed to have hereby authorised

Euroclear or Clearstream, Luxembourg, as may be appropriate, to disclose such information to the Issuer or its

duly appointed agent.

A39729228 285

Singapore

Each Dealer has acknowledged, and each further Dealer appointed under the Programme will be required

to acknowledge, that this Offering Circular has not been registered as a prospectus with the Monetary Authority

of Singapore. Accordingly, each Dealer has represented and agreed, and each further Dealer appointed under

the Programme will be required to represent and agree, that it has not offered or sold any Notes or caused the

Notes to be made the subject of an invitation for subscription or purchase and will not offer or sell any Notes

or cause the Notes to be made the subject of an invitation for subscription or purchase, and has not circulated

or distributed, nor will it circulate or distribute, this Offering Circular or any other document or material in

connection with the offer or sale, or invitation for subscription or purchase, of the Notes, whether directly or

indirectly, to any person in Singapore other than (i) to an institutional investor (as defined in Section 4A of the

Securities and Futures Act (Chapter 289) of Singapore, as modified or amended from time to time (the “SFA”))

pursuant to Section 274 of the SFA, (ii) to a relevant person (as defined in Section 275(2) of the SFA) pursuant

to Section 275(1) of the SFA, or any person pursuant to Section 275(1A) of the SFA, and in accordance with

the conditions specified in Section 275 of the SFA, or (iii) otherwise pursuant to, and in accordance with the

conditions of, any other applicable provision of the SFA.

Where the Notes are subscribed or purchased under Section 275 of the SFA by a relevant person which

is:

(a) a corporation (which is not an accredited investor (as defined in Section 4A of the SFA)) the sole business

of which is to hold investments and the entire share capital of which is owned by one or more individuals,

each of whom is an accredited investor; or

(b) a trust (where the trustee is not an accredited investor) whose sole purpose is to hold investments and

each beneficiary of the trust is an individual who is an accredited investor,

securities or securities-based derivatives contracts (each term as defined in Section 2(1) of the SFA) of that

corporation or the beneficiaries’ rights and interest (howsoever described) in that trust shall not be transferred

within six months after that corporation or that trust has acquired the Notes pursuant to an offer made under

Section 275 of the SFA except:

(i) to an institutional investor or to a relevant person, or to any person arising from an offer referred

to in Section 275(1A) or Section 276(4)(i)(B) of the SFA;

(ii) where no consideration is or will be given for the transfer;

(iii) where the transfer is by operation of law;

(iv) as specified in Section 276(7) of the SFA;

(v) as specified in Regulation 37A of the Securities and Futures (Offers of Investments) (Securities

and Securities-based Derivatives Contracts) Regulations 2018.

Singapore SFA Product Classification: In connection with Section 309B of the SFA and CMP Regulations 2018,

unless otherwise specified before an offer of Notes, the Issuers have determined, and hereby notifies all relevant

persons (as defined in Section 309A(1) of the SFA), that the Notes are ‘prescribed capital markets products’ (as

defined in the CMP Regulations 2018) and Excluded Investment Products (as defined in MAS Notice SFA 04-

N12: Notice on the Sale of Investment Products and MAS Notice FAA-N16: Notice on Recommendations on

Investment Products).

Hong Kong

Each Dealer has represented and agreed, and each further Dealer appointed under the Programme will

be required to represent, warrant and agree that:

A39729228 286

(a) it has not offered or sold, and will not offer or sell, in Hong Kong, by means of any document,

any Notes (except for Notes which are a “structured product” as defined in the Securities and Futures

Ordinance (Cap. 571) of Hong Kong (the “SFO”)) other than (i) to “professional investors” as defined

in the SFO and any rules made under the SFO, or (ii) in other circumstances which do not result in the

document being a “prospectus” as defined in the Companies (Winding Up and Miscellaneous Provisions)

Ordinance (Cap. 32) of Hong Kong (the “C(WUMP)O”) or which do not constitute an offer to the public

within the meaning of the C(WUMP)O; and

(b) it has not issued, or had in its possession for the purposes of issue, and will not issue or have in its

possession for the purposes of issue, whether in Hong Kong or elsewhere, any advertisement, invitation

or document relating to the Notes which is directed at, or the contents of which are likely to be accessed

or read by, the public of Hong Kong (except if permitted to do so under the securities laws of Hong

Kong) other than with respect to Notes which are or are intended to be disposed of only to persons

outside Hong Kong or only to “professional investors” as defined in the SFO and any rules made under

the SFO.

Japan

The Notes have not been and will not be registered under the Financial Instruments and Exchange Act

of Japan (Act No. 25 of 1948, as amended, the “Financial Instruments and Exchange Act”). Accordingly,

each Dealer has represented and agreed, and each further Dealer appointed under the Programme will be

required to represent and agree, that it has not, directly or indirectly, offered or sold and will not, directly or

indirectly, offer or sell any Notes in Japan or to, or for the benefit of, any resident of Japan (which term as used

herein means any person resident in Japan, including any corporation or other entity organised under the laws

of Japan) or to others for re-offering or re-sale, directly or indirectly, in Japan or to, or for the benefit of, any

resident of Japan except pursuant to an exemption from the registration requirements of, and otherwise in

compliance with, the Financial Instruments and Exchange Act and other relevant laws and regulations of Japan.

General

Each Dealer has represented, warranted and undertaken and each further Dealer appointed under the

Programme will be required to represent, warrant and undertake that it will (to the best of its knowledge and

belief) comply with all applicable securities laws and regulations in force in any jurisdiction in which it

purchases, offers, sells or delivers Notes or possesses or distributes this Offering Circular and will obtain any

consent, approval or permission required by it for the purchase, offer, sale or delivery by it of Notes under the

laws and regulations in force in any jurisdiction to which it is subject or in which it makes such purchases,

offers, sales or deliveries and neither the Issuers, the Guarantor, the Trustee nor any of the other Dealers shall

have any responsibility therefor.

None of the Issuers, the Guarantor, the Trustee, the Arrangers and the Dealers represents that Notes may

at any time lawfully be sold in compliance with any applicable registration or other requirements in any

jurisdiction, or pursuant to any exemption available thereunder, or assumes any responsibility for facilitating

such sale.

With regard to each Tranche, the relevant Dealer will be required to comply with such other restrictions

as the relevant Issuer, (in the case of Guaranteed Notes) the Guarantor and the relevant Dealer shall agree and

as shall be set out in the applicable Pricing Supplement.

Certain Relationships

The Dealers and certain of their affiliates may have performed certain investment banking and advisory

services for the Issuers and their affiliates from time to time for which they have received customary fees and

expenses and may, from time to time, engage in transactions with and perform services for the Issuers, the

A39729228 287

Guarantor and its affiliates in the ordinary course of their business. The Dealers or certain of their affiliates may

purchase Notes and be allocated Notes for asset management and/or proprietary purposes but not with a view

to distribution.

The Dealers and their affiliates are full service financial institutions engaged in various activities which

may include securities trading, commercial and investment banking, financial advice, investment management,

principal investment, hedging, financing and brokerage activities. Each of the Dealers may have engaged in,

and may in the future engage in, investment banking and other commercial dealings in the ordinary course of

business with the Issuers, the Guarantor or its subsidiaries, jointly controlled entities or associated companies

from time to time. In the ordinary course of their various business activities, the Dealers and their affiliates may

make or hold (on their own account, on behalf of clients or in their capacity as investment advisers) a broad

array of investments and actively trade debt and equity securities (or related derivative securities) and financial

instruments (including bank loans) for their own account and for the accounts of their customers and may at

any time hold long and short positions in such securities and instruments and enter into other transactions,

including credit derivatives (such as asset swaps, repackaging and credit default swaps) in relation thereto. Such

transactions, investments and securities activities may involve securities and instruments of the Issuers, the

Guarantor or its subsidiaries, jointly controlled entities or associated companies, including Notes issued under

the Programme, may be entered into at the same time or proximate to offers and sales of Notes or at other times

in the secondary market and be carried out with counterparties that are also purchasers, holders or sellers of

Notes. Notes issued under the Programme may be purchased by or be allocated to any Dealer or an affiliate for

asset management and/or proprietary purposes but not with a view to distribution.

The Dealers or their respective affiliates may purchase Notes for their own account and enter into

transactions, including credit derivatives, such as asset swaps, repackaging and credit default swaps relating to

Notes and/or other securities of the Issuers or their respective subsidiaries or associates, at the same time as the

offer and sale of Notes or in secondary market transactions. Such transactions would be carried out as bilateral

trades with selected counterparties and separately from any existing sale or resale of Notes to which this

Offering Circular relates (notwithstanding that such selected counterparties may also be purchasers of Notes).

A39729228 288

SUMMARY OF SIGNIFICANT DIFFERENCES BETWEEN IFRS AND IND-AS

The financial information included herein is prepared and presented in accordance with IND-AS. Certain

differences exist between IFRS and IND-AS which might be material to the financial information herein. The

matters described below summarise certain differences between IFRS and IND-AS that may be material. The

Company is responsible for preparing the Summary below. The Company has not prepared a complete

reconciliation of its consolidated financial statements and related footnote disclosures between IFRS and IND-

AS and has not quantified such differences. Accordingly, no assurance is provided that the following Summary

of differences between IFRS and IND-AS is complete. In making an investment decision, investors must rely

upon their own examination of the Company, the terms of the offering and the financial information. Potential

investors should consult their own professional advisors for an understanding of the differences between IFRS

and IND-AS, and how those differences might affect the financial information herein.

Topic IFRS IND-AS

Investments in

Associates and Joint Ventures ...

1. IFRS mandates use of

uniform accounting policies

for associates.

1. IND-AS requires use of

uniform accounting policies,

unless, in case of an

associate, it is impracticable.

Earnings per share ..................... 1. IFRS requires that when an

entity presents both

consolidated financial

statements and separate

financial statements, it may

give EPS related information

in consolidated financial

statements only.

1. IND-AS requires that when

an entity presents both



financial statements, it shall

disclose EPS related

information in both



financial statements.

2. This IFRS is applicable to

listed entity or entity in the

process of listing.

2. The IND-AS applicability is

governed by the Companies

Act 2013 and the Rules made

thereunder.

3. Because of specific treatment

of discount and premium on

shares under the Companies

Act 2013, this paragraph has

been added in IND-AS

which is not in IFRS –

“where any item of income

or expense which is

otherwise required to be

recognised in profit or loss in

accordance with accounting

standards is debited or

credited to securities

premium account/other

A39729228 289

Topic IFRS IND-AS

reserves, the amount is

respect thereof shall be

deducted from profit or loss

from continuing operations

for the purpose of calculating

basic earnings per share.”

Interim Financial

Reporting ....................................

1. IFRS encourages publicly

traded entities to provide

interim financial reports

conforming to the

recognition, measurement

and disclosure principles set

out in this standard.

1. IND-AS envisages that the

requirement to present

interim financial report

should be governed by the

relevant law or regulation

and not by way of an

encouragement through an

accounting standard.

Foreign Exchange

Differences ..................................

1. Exchange differences arising

on translation or settlement

of foreign currency monetary

items are recognised in profit

or loss in the period in which

they arise, except when

hedge accounting is applied.

1. Similar to IFRS. However an

entity may continue the

policy adopted for exchange

differences arising from

translation of long-term

foreign currency monetary

items recognised in the

financial statements for the

period ending immediately

before the beginning of the

first IND-AS financial

reporting period as per

previous GAAP.

2. When there is a change in

functional currency of either

the reporting currency or a

significant foreign operation,

IFRS requires disclosure of

that fact and the reason for

the change in functional

currency.

2. When there is a change in

functional currency of either

the reporting currency or a

significant foreign operation,

IND-AS requires an

additional disclosure of the

date of change in functional

currency.

First time adoption ..................... 1. IFRS 1 gives detailed

guidance on preparation of

the first IFRS financial

statements. To help

overcome a number of

practical challenges for a

first-time adopter, there are

certain mandatory

exemptions/voluntary

1. IND-AS 101 gives detailed

guidance on preparation of

the first IND-AS financial

statements. To help

overcome a number of

practical challenges for a

first-time adopter, there are

certain mandatory

exemptions/voluntary

exemptions from the full

A39729228 290

Topic IFRS IND-AS

exemptions from the full

retrospective application.

retrospective application.

IND-AS 101 gives few

additional voluntary

exemptions/modifications as

compared to IFRS. For

example,

a. The first time adopter

shall account for the

resulting change in the

retained earnings as at

the transition date

except in certain

specific instances

where it requires

adjustment in goodwill.

In such specific

instances where IFRS 1

allows adjustment in

the goodwill, under

IND-AS it can be

adjusted with capital

reserve to the extent

such adjustment

amount does not exceed

the balance available in

capital reserve.

b. IND-AS 101 in addition

to exemptions provided

under IFRS 1, also

provides certain

optional exemptions

relating to long term

foreign currency

monetary items and

service concessions

arrangements relating

to toll roads.

2. IFRS 1 Appendix B gives

Exceptions to the

retrospective application of

other IFRSs. It does not

cover impairment of

financial assets.

2. Exceptions under IND-AS

101 covers impairment of

assets under Appendix B

vide paragraphs B8D-B8G

for Exceptions to the

retrospective applications of

other IND-ASs.

A39729228 291

Topic IFRS IND-AS

3. Classification and

measurement of financial

assets given in IFRS 1

Appendix B Paragraph B8

read with IFRS 9 Paragraph

4.1.2 does not provide for a

financial asset to be

measured at fair value

through other comprehensive

income.

3. Classification and

measurement of financial

assets given in IND-AS 101

Appendix B Paragraph B8

read with Paragraph 4.12.A

of IND-AS 109 provides for

financial asset to be

measured at fair value

through other comprehensive

income if specific conditions

are met.

4. The IFRS 1 provides various

examples of first IFRS

financial statements. There is

no statutory requirement

under any legislation for

compliance with IFRS.

4. Paragraph 3 of IND-AS 101

specifies that an entities first

financial statements are the

first annual financial

statements in accordance

with IND-ASs notified under

the Companies Act 2013.

Presentation of financial

statements ...................................

A complete set of financial

statements under IFRS comprises:

A complete set of financial

statements under IND-AS

comprises:

1. Statement of financial

position as at the end of the

financial year.

1. Balance sheet as at the end of

the financial year.

2. Statement of Profit and Loss

and Other Comprehensive

Income. For Statement of

profit or loss and other

comprehensive income for

the financial year there is an

option of presentation as

single statement or two

separate statements.

2. Statement of Profit and Loss.

For Statement of profit or

loss and other

comprehensive income for

the financial year there is an

option of presentation as

single statement or two

separate statements.

3. The words ‘authorisation of

the financial statements for

issue’ have been used in the

context of financial

statements considered for the

purpose of events after the

reporting period.

3. The words ‘approval of the

financial statements for

issue’ have been used in the

context of financial

statements considered for the

purpose of events after the

reporting period.

4. The words ‘fair presentation’

is used.

4. The words ‘true and fair

view’ has been used.

5. There is option to individual

entities to follow different

5. IND-AS removes the

alternatives by giving one

A39729228 292

Topic IFRS IND-AS

terminology for titles of

financial statements.

terminology to be used by all

entities.

6. IFRS permits the periodicity

for example 52 weeks for

preparation of financial

statements.

6. IND-AS does not permit

periodicity such as 52 weeks

for preparation of financial

statements.

7. IFRS requires an entity to

prepare an analysis of

expenses recognised in profit

of loss using a classification

based on either their nature

or their function within the

equity.

7. IND-AS requites only nature

wise classification of

expenses.

8. As per IND-AS, long term

loan arrangement need not be

classified as current on

account of breach of material

provision, for which the

lender has agreed to waive

before approval of financial

statements for issue.

Statement of Cash

Flows............................................

1. In case of other than financial

entities, IAS 7 gives an

option to classify the interest

paid and interest and

dividend received as item of

operating cash flows.

1. In IND-AS there is no such

option and requires the

interest paid and interest and

dividend received to be

classified as item of

financing activity and

investing activity,

respectively.

2. IFRS gives an option to

classify the dividend paid as

an item of operating activity.

2. IND-AS requires dividend

paid to be classified as a part

of financing activity only.

Employee benefits ...................... Discount rate is determined by

reference to market yields at the

end of reporting period on high

quality corporate bonds. In

countries where there is no deep

market in such bonds, the market

yield on government bonds

denominated in that currency

should be used.

Discount rate is determined by

reference to market yield at the

end of reporting period on

government bonds.

Business Combinations .............. 1. IFRS excludes from its scope

business combinations of

1. IND-AS gives guidance for

business combinations of

A39729228 293

Topic IFRS IND-AS

entities under common

control.

entities under common

control.

2. IFRS requires bargain

purchase gain arising on

business combination to be

recognised in profit or loss.

2. IND-AS requires bargain

purchase gain arising on

business combination to be

recognised in other

comprehensive income and

accumulated in equity as

capital reserve, unless there

is no clear evidence for the

underlying reason for

classification of the business

combination as a bargain

purchase, in which case it

shall be recognised directly

in equity as capital reserve.

Operating segments .................... This IFRS is applicable to listed

entities only.

This IND-AS is applicable as per

Companies Act 2013 and Rules.

Related party

disclosures ...................................

1. In IFRS no provisions are

specified for disclosures

which conflict with the

confidentiality requirements

of statue/regulations.

1. In IND-AS, disclosures

which conflict with the

confidentiality requirements

of statue/regulations are not

required to be made since

accounting standard cannot

override legal/regulatory

requirements.

2. In IFRS, close family

members of key managerial

personnel are defined.

2. IND-AS 24 does not include

the word relatives. It only

elaborates the definition of

close members of the family

of key management

personnel to include persons

identified as relatives in

previous GAAP or in

Companies Act, 2013.

Government Grant ..................... 1. IFRS gives an option to

present grants, including

non-monetary grants at their

fair value in the balance sheet

either by setting up the grant

as deferred income or by

deducting the grant in

arriving at the carrying

amount of the asset.

1. IND-AS requires

presentation of grants in

balance sheet only by setting

up the grant as deferred

income. Thus the option to

present grants by deduction

of the grant in arriving at the

carrying amount of asset is

not available under IND-AS.

A39729228 294

Topic IFRS IND-AS

Inventories .................................. In case of function wise

classification inventory expense is

recognised as cost of sales

whereas in case of nature wise

classification the inventory

expense is recognised by making

reference as ‘changes in

inventories of finished goods and

work in progress’ and raw

materials consumed in profit and

loss statement.

IND-AS allows only nature wise

classification of inventory

expense.

Separate Financial

Statements ...................................

1. IFRS requires to disclose the

reason for preparing separate

financial statements if not

required by law.

1. As the Companies Act 2013

mandates preparation of

separate financial statements,

IND-AS has been modified

to remove such

requirements.

2. IFRS allows entity to use the

equity method to account for

investments in subsidiaries,

joint ventures and associates

in their Separate Financial

Statements.

2. IND-AS does not permit use

of equity method as it is not a

measurable basis like cost

and fair value but is a manner

of consolidation and

therefore would lead to

inconsistent accounting

conceptually.

Leases .......................................... 1. In case of operating leases

under IFRS, lessee

recognises the lease

payments in profit or loss on

a straight-line basis over the

lease term.

1. Where the escalation of lease

rental is in line with the

expected general inflation so

as to compensate the lessor

for expected inflationary

cost, the increase in the rental

shall not be straight lined

(IND AS 17).

2. IFRS 16 provides that if

lessee applies fair value

model in IAS 40 to its

investment property, it shall

apply that fair value model

to the right-of use assets that

meet the definition of

investment property. It

requires to classify cash

payments for interest

portion of lease liability

applying requirements of

2. Since IND-AS 40,

Investment Property, does

not permit the use of fair

value model (paragraph 34

has been deleted in IND-AS

116). Paragraph 50(b) has

been modified in IND-AS

116 to specify that cash

payments for interest portion

of lease liability will be

classified as financing

activities applying IND-AS

A39729228 295

Topic IFRS IND-AS

IAS 7, Statement of Cash

Flows. IAS 7 provides

option of treating interest

paid as operating or

financing activity.

7. IND-AS takes effect from

1 April 2019.

Investment property ................... Investment property is measured

initially at cost. Transaction costs

are included in the initial

measurement. Investment

property can subsequently be

measured using the cost or the fair

value model, with changes in fair

value recognised in profit or loss.

Investment property are to be

measured using the cost model.

Fair value model is not permitted.

Detailed disclosures pertaining to

fair value have to be given.

Borrowing cost ............................ IFRS provides no guidance as to

how exchange differences arising

from foreign currency borrowings

to the extent they are regarded as

an adjustment to the interest cost.

IND-AS 23 provides specific

guidance in paragraph 6A for

adjustment of exchange

differences arising from foreign

currency borrowings interest

costs.

Revenue from Contracts with

Customers ...................................

IFRS 15 provides that all types of

penalties which may be levied in

the performance of a contract

should be considered in the nature

of variable consideration for

recognising revenue.

IND-AS 115 has been amended to

provide that penalties shall be

accounted for as per the substance

of the contract. Where the penalty

is inherent in the determination of

transaction price, it shall form part

of the variable consideration,

otherwise the same should not be

considered for determining the

consideration and the transaction

price shall be considered as fixed.

A39729228 296

GENERAL INFORMATION

Authorisation

1 The establishment of the Programme and the issue of the Notes and the giving of the guarantee (in respect of

the Guaranteed Notes) thereunder have been duly authorised by a resolution of the Board of Directors of ONGC

dated 20 June 2019. The establishment of the Programme and the issue of Notes thereunder have been duly

authorised by a resolution of the Board of Directors of ONGC Videsh dated 9 August 2019.

Listing

2 Approval in-principle has been received from the SGX-ST for the establishment of the Programme and

application will be made to the SGX-ST for the permission to deal in, and for the quotation of, any Notes that

may be issued pursuant to the Programme and which are agreed at or prior to the time of issue thereof to be so

listed on the SGX-ST. Such permission will be granted when such Notes have been admitted to the Official List

of the SGX-ST.

For so long as any Notes are listed on the SGX-ST and the rules of the SGX-ST so require, such Notes listed

on the SGX-ST will be traded on the SGX-ST in a minimum board lot size of S$200,000 (or its equivalent in

other currencies).

Admission to the Official List and quotation of any Notes on the SGX-ST are not to be taken as an indication

of the merits of the Issuers, the Programme or the Notes. So long as the Notes are listed on the SGX-ST and the

rules of the SGX-ST so require, each Issuer shall appoint and maintain a paying agent in Singapore, where the

Notes may be presented or surrendered for payment or redemption, in the event that the Global Notes are

exchanged for definitive Notes. In addition, in the event that the Global Notes are exchanged for definitive

Notes, announcement of such exchange shall be made through the SGX-ST and such announcement will include

all material information with respect to the delivery of the definitive Notes, including details of the paying agent

in Singapore.

Clearing Systems

3 The Notes to be issued under the Programme have been accepted for clearance through Euroclear and

Clearstream, Luxembourg. The appropriate common code and ISIN for each Tranche of Notes allocated by

Euroclear and Clearstream, Luxembourg will be specified in the applicable Pricing Supplement. If the Notes

are to clear through an additional or alternative clearing system, the appropriate information will be specified

in the applicable Pricing Supplement.

No Significant Change

4 Save as disclosed in this Offering Circular, there has been no significant change in the financial or trading

position of the Company or ONGC Videsh since 30 June 2019 and there has been no material adverse change

in the financial position or prospects of the Company or ONGC Videsh since 30 June 2019.

Litigation

5 Unless otherwise disclosed in this Offering Circular, none of ONGC or any of its respective subsidiaries

including ONGC Videsh is involved in any material legal or arbitration proceedings (including any proceedings

which are pending or threatened of which ONGC or ONGC Videsh is aware) which may have or have had in

A39729228 297

the 12 months preceding the date of this Offering Circular a significant effect on the financial position of ONGC

Videsh or the Company.

Accounts

6 The auditors in respect of the consolidated financial statements of the Company for the year ended 31 March

2018 were as follows:

Lodha & Co, Chartered Accountants

MKPS & Associates, Chartered Accountants

Khandelwal Jain & Co., Chartered Accountants

K.C. Mehta & Co., Chartered Accountants

PKF Sridhar & Santhanam LLP, Chartered Accountants

Dass Gupta & Associates, Chartered Accountants

Such auditors have audited the Company’s consolidated financial statements for the year ended 31 March 2018

in accordance with generally accepted auditing standards in India.

The auditors in respect of the consolidated financial statements of the Company for the year ended 31 March






G M Kapadia & Co., Chartered Accountants

R Gopal & Associates, Chartered Accountants

Such auditors have audited the Company’s consolidated financial statements for the year ended 31 March 2019

in accordance with generally accepted auditing standards in India.

The auditors in respect of the consolidated financial statements of the Company for the three months ended 30

June 2019 and the non-consolidated financial statements of the Company for the three months ended 30 June






G M Kapadia & Co., Chartered Accountants

R Gopal & Associates, Chartered Accountants

Such auditors have reviewed the consolidated financial statements of the Company for the three months ended

30 June 2019 and the non-consolidated financial statements of the Company for the three months ended 30 June

2019 each in accordance with generally accepted auditing standards in India.

Trust Deed

7 The Trust Deed provides, among other things, that the Trustee may rely on certificates or reports from the

Auditors (as defined in the Trust Deed) or any other person in accordance with the provisions of the Trust Deed

as conclusive evidence of the facts stated therein whether or not called for by or addressed to the Trustee and

whether or not any such certificate or report or engagement letter or other document entered into by the Trustee

A39729228 298

and the Auditors or such other person in connection therewith contains a monetary or other limit on the liability

of the Auditors or such other person. However, the Trustee will have no recourse to the Auditors or such other

person in respect of such certificates or reports unless the Auditors or such other person have agreed to address

such certificates or reports to the Trustee.

Documents Available

8 So long as Notes are capable of being issued under the Programme, copies of the following documents will,

when published, be available (i) for inspection by any Noteholder at the principal place of business of the

Trustee (being at the date of this Offering Circular at 20/F, Citi Tower, One Bay East, 83 Hoi Bun Road, Kwun

Tong, Kowloon, Hong Kong) at all reasonable times during normal business hours (being 9.00 a.m. to 3.00

p.m.) following prior written request and proof of holding and identity satisfactory to the Trustee and subject,

in the case of all documents other than those referred to in (d) below, to the same having been provided to the

Trustee by the relevant Issuer and (ii) from the corporate office of ONGC:

(a) the constitutive documents of each Issuer and ONGC;

(b) the audited consolidated financial statements of the Company for the years ended 31 March 2018 and

31 March 2019 (in each case together with the auditor reports in connection therewith);

(c) the unaudited and reviewed consolidated financial statements of the Company for the three months ended

30 June 2019 and the unaudited and reviewed non-consolidated financial statements of the Company for

the three months ended 30 June 2019 (in each case together with the auditor reports in connection

therewith);

(d) the most recently published audited consolidated annual financial statements of the Company and the

most recently published consolidated and/or unconsolidated interim financial statements (whether

audited or unaudited) of the Company;

(e) the Trust Deed, the Agency Agreement and the forms of the Global Notes, the Notes in definitive form,

the Receipts, the Coupons and the Talons;

(f) a copy of this Offering Circular; and

(g) any future offering circulars, prospectuses, information memoranda and supplements including Pricing

Supplements (save that a Pricing Supplement relating to an unlisted Note will only be available for

inspection by a holder of such Note and such holder must produce evidence satisfactory to the relevant

Issuer and the Paying Agent as to its holding of Notes and identity) to this Offering Circular and any

other documents incorporated herein or therein by reference.

A39729228 299

GLOSSARY OF CERTAIN GENERAL AND TECHNICAL TERMS

Unless otherwise indicated in the context, references to:

Term Description

“1P” Proved reserves.

“2P” Proved and probable reserves.

“3P” Proved, probable and possible reserves.

“APM” Administered pricing mechanism.

“ASP” Alkaline surfactant polymer.

“bbl/d” Barrels of oil per day

“BCM” Billion cubic metres.

“CBM” Coal bed methane.

“C2+” Heavier components of natural gas excluding C1 (methane).

“Cess” A duty of excise imposed under the Oil Industry Development

Act, 1974 on crude oil produced in India and payable to the

Central Government.

“CGD” City gas distribution.

“Condensate” Low vapour pressure hydrocarbons obtained from natural gas

through condensation or extraction; condensate refers solely to

those hydrocarbons that are liquid at normal surface temperature

and pressure conditions.

“Contingent Resources” Resources that are potentially recoverable but not yet considered

mature enough for commercial development due to technological

or business hurdles.

“Depletion” A measure of exhaustion of a wasting asset represented by

periodic write off of cost. It is computed with reference to the

amortisation base by taking the related capital cost incurred,

divided by proved developed hydrocarbon reserves and

multiplied by production.

“Development” Following discovery, drilling and related activities necessary to

begin production of oil or natural gas.

“Development Well” A well drilled within a proved area of an oil and natural gas

reservoir and completed to a targeted horizon known to be

productive.

“DGH” Director General of Hydrocarbons.

“DSF” Discovered small field.

“E&P” Exploration and production.

A39729228 300

Term Description

“EOR” Enhanced oil recovery.

“exploration” Systematically searching for oil and/or natural gas by

topographical surveys, geologic studies, geophysical surveys,

seismic surveys and drilling wells.

“Exploratory Well” A well drilled in an unproved area for the purpose of finding and

producing oil and/or gas (includes exploratory-type stratigraphic

test wells).

“Finding Costs” A measurement used to evaluate the success of exploration

activities, consisting of the ratio of exploration costs incurred in

a given period in connection with such activities to reserves

discovered as a result of such activities.

“GDP” Gross domestic product.

“HDPE” High Density Polyethylene.

“HPHT” High Pressure High Temperature.

“HSD” High speed diesel.

“HTL” High Tide Line.

“IOR” Improved oil recovery.

“KTPA” Kilo tonnes per annum.

“Liquefied Natural Gas” or “LNG” Gas that is liquefied under extremely cold temperatures and high

pressure to facilitate storage or transportation in specially

designed vehicles.

“Liquefied Petroleum Gas” or “LPG” Light gases such as butane and propane that exist as liquids under

pressure.

“LLDPE” Linear Low-Density Polyethylene.

“MCM” Million cubic metres.

“MMbbls” Million barrels.

“MMboe Million barrels of oil equivalent.

“MMbtu” Million British thermal unit.

“MMCM” or “MMSCM” Million standard cubic metres.

“MMSCFD” Million standard cubic feet per day.

“MMSCMD” or “MM S CMD” Million standard cubic metres per day.

“MMT” Million metric tonnes.

“MMtoe” Million metric tonnes oil equivalent.

“MMTPA” Million metric tonnes per annum.

A39729228 301

Term Description

“Model PSC” The model production sharing contract.

“Model RSC” The model revenue sharing contract.

“MS” Motor spirit.

“MT” Metric tonnes.

“MW” Megawatt.

“MWP” Megawatt Peak.

“PDS” Public distribution system.

“PSC” Production sharing contract.

“PSUs” Public sector undertakings.

“royalty” With respect to domestic production, a statutory levy imposed

under the Oilfield Act and PNG Rules payable to the respective

State or Central Government granting the lease (Central

Government in case of offshore) on crude oil and natural gas

production.

“SCM” Standard cubic metre.

“Seismic Data” Data recorded in either two-dimensional (2-D) or three-

dimensional (3-D) form from sound wave reflections off of

subsurface geology. This is used to understand and map

geological structures for exploratory purposes to predict the

potential location of undiscovered reserves.

“SKO” Superior kerosene oil.

“SPM” Single point mooring.

“Tcm” Trillion cubic metres

“TMT” Thousand metric tonnes.

A39315570/0.69a/06 Aug 2019 F-1

INDEX TO FINANCIAL STATEMENTS

Quarter ended 30 June 2019

Auditors’ Limited Review Report on Unaudited Standalone Financial Results of the

Company for the Quarter ended 30 June 2019 .......................................................................... F-2

Statement of Standalone Financial Results for the Quarter ended 30 June 2019 ...................... F-5

Standalone Segment Wise Revenue, Results, Assets and Liabilities......................................... F-6

Notes to the Unaudited Standalone Financial Results of the Company for the Quarter ended

30 June 2019 ............................................................................................................................. F-7

Auditors’ Limited Review Report on Consolidated Financial Results of the Company for the

Quarter ended 30 June 2019 ...................................................................................................... F-10

Statement of Consolidated Financial Results for the Quarter ended 30 June 2019 ................... F-14

Consolidated Segment Wise Revenue, Results, Assets and Liabilities ..................................... F-15

Notes to the Consolidated Standalone Financial Results of the Company for the Quarter

ended 30 June 2019 ................................................................................................................... F-16

Year ended 31 March 2019

Auditors’ Report for the Consolidated Financial Statements of the Company for the year

ended 31 March 2019 ................................................................................................................ F-18

Consolidated Balance Sheet as at 31 March 2019..................................................................... F-38

Consolidated Statement of Profit and Loss for the year ended 31 March 2019 ........................ F-40

Consolidated Statement of Changes in Equity for the year ended 31 March 2019 ................... F-43

Consolidated Statement of Cash Flows for the year ended 31 March 2019 .............................. F-45

Notes to the Consolidated Financial Statements for the year ended 31 March 2019 ................ F-48

Year ended 31 March 2018

Auditors’ Report for the consolidated financial statements of the Company for the year

ended 31 March 2018 ................................................................................................................ F-230

Consolidated Balance Sheet as at 31 March 2018..................................................................... F-234

Consolidated Statement of Profit and Loss for the year ended 31 March 2018 ........................ F-236

Consolidated Statement of Changes in Equity for the year ended 31 March 2018 ................... F-239

Consolidated Statement of Cash Flows for the year ended 31 March 2018 .............................. F-242

Notes to the Consolidated Financial Statements for the year ended 31 March 2018 ................ F-245

R Gopal & Associates

Chartered Accountants, 1007,

1/lA, Vansittart Row,

Kolkata -700 001

K.C, Mehta & Co.

Chartered Accountants

2nd floor, Meghdhanush,

Race Course Circle,

Vadodara -390 007

MKPS & Associates


403, 4th Floor, Grace Chambers,

Andheri Kurla Road, Chakala

Andheri {East), Mumbai-400 093

PKF Sridhar & Santhanam LLP


91-92, Dr. Radhakrishnan Salai,

Mylapore,

Chennai -600 004

G M Kapadia & Co.


1007 Raheja Chambers,

213 Nariman Point,

Mumbai 400 021

Dass Gupta & Associates


B4, Gulmohar Park,

New Delhi - 110 049

Independent Auditors' Limited Review Report on Unaudited Standalone Financial Results of OIL

AND NATURAL GAS CORPORATION LIMITED for the Quarter ended on June 30, 2019 pursuant to

the Regulation 33 of the SEBI {Listing Obligations and Disclosure Requirements) Regulations,

2015

TO

THE BOARD OF DIRECTORS OF

OIL AND NATURAL GAS CORPORATION LIMITED

1. We have reviewed the accompanying statement of Unaudited Standalone Financial Results for

the quarter ended June 30, 2019 (herein after referred to as "the Statement" and initialled for

the purpose of identification) of Oil and Natural Gas Corporation Limited ("the Company")

being submitted by the Company pursuant to the requirements of Regulation 33 of the SEBI

(Listing Obligations and Disclosure Requirements) Regulations, 2015, read with Circular No.

CIR/ CFO/ FAC/ 62/ 2016 dated July S, 2016.

The Statement, is the responsibility of the Company's Management and has been approved by

the Board of Directors, has been prepared in accordance with the recognition and

measurement principles laid down in Indian Accounting Standards {"Ind AS") prescribed under

section 133 of the Companies Act, 2013 read with the relevant rules issued thereunder and

other accounting principles generally accepted in India. Our responsibility is to issue a report

on the Statement based on our review.

2. We conducted our review of the Statement in accordance with the Standard on Review

Engagement {SRE) 2410, "Review of Interim Financial information performed by the

Independent Auditor of the Entity" issued by the Institute of Chartered Accountants of India.

This standard requires that we plan and perform the review to obtain moderate assurance as

to whether the financial statements are free of material misstatement. A review is limited

primarily to inquiries of company personnel and analytical procedures applied to financial data

and thus provide less assurance than an audit. We have not performed an audit

accordingly, we do not express an audit opinion.

F - 2

3. Based on our review conducted as above nothing has come to our attention that causes us to

believe that the accompanying standalone unaudited financial results read with notes

thereon, prepared in accordance with applicable Ind AS and other recognized accounting

practices and policies thereon has not disclosed the information required to be_ disclosed in

terms of Regulation 33 of the SEBI (Listing Obligations and Disclosure Requirements)

Regulations, 2015, read with Circular No. CIR/ CFO/ FAC/ 62/ 2016 dated July 5, 2016,

including the manner in which it is to be disclosed, or that it contains any material

misstatement.

Emphasis of Matter

4. We draw attention to Note 5 of the Statement, wherein it is stated that Directorate General of

Hydrocarbons (DGH) had raised a demand on all the JV partners under the Production Sharing

Contract with ,respect to Panna-Mukta and Mid and South Tapti contract areas (PMT JV), being

BG Exploration and Production India Limited (BGEPIL) and Reliance Industries Limited (RIL)

(together "the Claimants") and the Company towards differential GOI share of Profit

Petroleum and Royalty alleged to be payable by contractor pursuant to Government's

interpretation of the Final Partial Award (40% share of the Company amounting to USO

1624.05 million equivalent to '{ 11,215 Crore, including interest upto November 30, 2016.

Subsequent to London High Court Orders dated April 16, 2018 and May 2, 2018, DGH vide

letter dated May 4, 2018, May 15, 2018, June 4, 2018 and January 14, 2019 had asked for re

casting of accounts of the PMT JV and for remitting the respective Pl share of balance dues

including interest till the date of remittance. As the company is not a party to the arbitration,

the details of the proceedings of arbitration and copy of the order of London High Court are

not available with the company. The Company has responded that as of now, neither the

Arbitral Tribunal nor the London High Court has passed any order or quantified any amount

due and payable by the Company and in the circumstances; the demand of DGH from the

Company for any sum or interest thereon is premature and not justified. In the Company's

view, pending final quantification of liabilities by the Arbitration Tribunal, it is not liable to

implement the Final Partial Award (FPA) being pre-mature and therefore no provision for the

same has been considered necessary and the same has been considered as contingent liability.

Our conclusion on the Statement and our report is not modified in respect of the above

matter.

Other Matter

5. The statement includes the company's proportionate share in the expenditure and Income of

137 blocks under New exploration licensing policy (NELP)/ Hydrocarbon Exploration and

Licensing Policy (HELP)/ Joint Operations (JO) accounts for exploration and production out of

which 18 NELP/JO have been certified by management in respect of NELP/JO operated by

other operators. In respect of these 18 NELP/JO, the statement includes proportionate share

in revenue and profit before tax including other comprehensive Income for the quarter ended

June 30, 2019 amounting to'{ 2,947.29 Crore and'{ 632.80 Crore respectively. Our opinion is

solely based on management certified accounts in respect of these blocks.

F - 3

reserves and depletion thereof on Oil and Gas Assets, impairment, liability for abandonment costs, liability for NELP and nominated blocks for under performance against agreed Minimum Work Programme.

Our conclusion on the Statement and our report is not modified in respect of the above matters.

For K.C. Mehta & Co.

Chartered Accountants � ....... , Reg. No.106237W

� '"''"''""""''� Doshi)

� M. No. 101533} ........:=� .. 19101533AAAAAT4598

Place: New Delhi Date: August 13th ,2019

For MKPS & Associates

Chartered Accountants Fi Reg. No: 30201

For PKF Sridhar & Santhanam LLP

(V. Kothandaram Partner {M.No.02 UDIN: 19025973M

For G M Kapadia & Co. Chartered Accountants Firm Reg. No: 104767W

�

a

�f>.PAO;"'lcf

� ... � . ()

'\)l,l� :; MUMBAI � (Rajen Ashar) � .,Partner (M.No.048243} ci,'>'e,..6ct 1-)�,��

UDIN: 19048243AAAADG8 cc<>

F - 4

SI.

No.

1

2

3

4


CIN No. L74899DL1993GOI054155

Regd.Office : Plot No. SA- 58, Nelson Mandela Road, Vasant Kunj, New Delhi, South West Delhi - 110070

Tel: 011-26754002, Fax: 011-26129091, E-mail: [email protected]

SEGMENT WISE REVENUE, RESULTS, ASSETS & LIABILITIES

Particulars Quarter ended Quarter ended Quarter ended

30.06.2019 31.03.2019 30.06.2018

Unaudited Audited Unaudited

Segment Revenue

Revenue from Operations

a) Offshore 17,304.94 16,978.52 18,065.95

b) Onshore 9,249.80 9,779.94 9,146.88

Total 26,554.74 26,758.46 27,212.83

Less: Inter Segment Operating Revenue - - -

Revenue from operations 26,554.74 26,758.46 27,212.83

Segment Result Profit(+)/Loss(-) before tax and interest from each segment

a) Offshore 7,517.42 4,480.90 8,449.51

b) Onshore 2,129.72 462.14 2,368.67

Total 9,647.14 4,943.04 10,818.18

Less:

i. Finance Cost 646.08 533.68 748.61

ii. Other unallocable expenditure net of unallocable income. (56.11) (1,169.89) 462.82

Profit before Tax 9,057.17 5,579.25 9,606.75

Segment Assets

a) Offshore 134,633.66 126,086.26 125,655.93

b) Onshore 65,514.04 63,800.43 58,223.23

c) Other Unallocated 109,970.62 112,348.12 109,543.50

Total 310,118.32 302,234.81 293,422.66

Segment Liabilities

a) Offshore 38,960.15 31,007.56 31,776.34

b) Onshore 14,388.12 12,877.00 11,636.80

c) Other Unallocated 49,182.99 55,357.70 52,925.50

Total 102,531.26 99,242.26 96,338.64

Note:- Above segment information has been classified based on Geographical Segment

(� in Crore)

Year ended

31.03.2019

Audited

73,015.47

36,639.08

109,654.55 -

109,654.55

31,028.95

8,494.00

39,522.95

2,492.14

(2,923.22)

39,954.03

126,086.26

63,800.43

112,348.12

302,234.81

31,007.56

12,877.00

55,357.70

99,242.26

F - 6

Since the Company is contesting the demand, it has been considered as contingent liability.

Further, as an abundant caution, the Company has deposited Service Tax and GST along-with

interest under-protest amounting to� 1,373 Crore and� 3,276 Crore respectively.

7. Previous period's figures have been regrouped by the Company, wherever necessary, toconform to current quarter's classification.

Place: New Delhi

Date : August 13, 2019

By order of the Board

(�!n� Director (Finance)

F - 9

·,

R Gopal & Associates

Chartered Accountants, 1007,

1/lA, Vansittart Row,

Kolkata -700 001

K. C. Mehta & Co.


2nd floor, Meghdhanush,

Race Course Circle,

Vadodara -390 007

MKPS & Associates


403, 4th Floor, Grace Chambers,

Andheri Kurla Road, Chakala

Andheri (East), Mumbai-400 093

PKF Sridhar & Santhanam LLP


91-92, Dr. Radhakrishnan Salai,

Mylapore,

Chennai -600 004

G M Kapadia & Co.


1007 Raheja Chambers,

213 Nariman Point,

Mumbai 400 021

Dass Gupta & Associates


B4, Gulmohar Park,

New Delhi - 110 049

Independent Auditors' Limited Review Report on Consolidated Unaudited Financial Results of OIL

AND NATURAL GAS CORPORATION LIMITED for the Quarter ended on June 30, 2019 pursuant to

the Regulation 33 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations,

2015

TO

THE BOARD OF DIRECTORS OF


1. We have reviewed the accompanying Statement of Consolidated Unaudited Financial Results

of Oil and Natural Gas Corporation Limited ("the Holding Company") and its subsidiaries (the

Holding Company and its subsidiaries together referred to as "the Group"), and its share of

the net profit/(loss) after tax and total comprehensive income / (loss) of its associates and

joint ventures for the quarter ended June 30, 2019 ("the Statement"), being submitted by the

Holding Company pursuant to the requirements of Regulation 33 of the SEBI (Listing

Obligations and Disclosure Requirements) Regulations, 2015, as amended. Attention is drawn

to the fact that the consolidated figures for the corresponding quarter ended June 30, 2018

and preceding quarter ended March 31,2019 as reported in these financial results have been

approved by the Holding Company's Board of Directors but have not been subjected to

review.

2. This Statement, which is the responsibility of the Holding Company's Management and

approved by the Holding Company's Board of Directors, has been prepared in accordance

with the recognition and measurement principles laid down in Indian Accounting Standard 34

"Interim Financial Reporting" ("Ind AS 34"), prescribed under Section 133 of the Companies

Act, 2013, and other accounting principles generally accepted in India. Our responsibility is to

express a conclusion on the Statement based on our review.

3.

F - 10

We also performed procedures in accordance with the Circular issued by the Securities and

Exchange Board of India under Regulation 33(8) of the SEBI (Listing Obligations and Disclosure

Requirements) Regulations, 2015 as amended, to the extent applicable.

4. The Statement includes the results of the following entities:

Sr. No. Name of the entity

A Holding Company


B Subsidiaries

1 ONGC Videsh Limited*

2 Mangalore Refinery and Petrochemicals Limited * #

3 Petronet MHB Limited

4 Hindustan Petroleum Corporation Limited *

C Joint Ventures

1 ONGC Teri Biotech Limited

2 ONGC Tripura Power Company Limited *

3 ONGC Petro Additions Limited

4 Mangalore SEZ Limited *

5 lndradhanush Gas Grid Limited

6 Dahej SEZ Limited

D Associates

1 Petronet LNG Limited *

2 Pawan Hans Limited

3 Rohini Heliport Limited

* As per consolidated financial results

# Consolidated financial results of Mangalore Refinery and Petrochemicals Limited

includes its subsidiary, ONGC Mangalore Petrochemicals Limited, which is an indirect

Subsidiary of the Holding Company.

5. Based on our review conducted and procedures performed as stated in paragraph 3 above

and based on the consideration referred to in paragraph 9 below, nothing has come to our

attention that causes us to believe that the accompanying Statement, prepared in

accordance with the recognition and measurement principles laid down in the aforesaid

Indian Accounting Standard and other accounting principles generally accepted in India, has

not disclosed the information required to be disclosed in terms of Regulation 33 of the SEBI

(Listing Obligations and Disclosure Requirements) Regulations, 2015, as amended, including

the manner in which it is to be disclosed, or that it contains any material misstatement.

Emphasis of Matter

F - 11

Sharing Contract with respect to Panna-Mukta and Mid and South Tapti contract areas (PMT

JV), being BG Exploration and Production India Limited (BGEPIL) and Reliance Industries

Limited (RIL) (together "the Claimants") and the Company towards differential GOI share of

Profit Petroleum and Royalty alleged to be payable by contractor pursuant to Government's

interpretation of the Final Partial Award (40% share of the Company amounting to USD

1624.05 million equivalent to � 11,215 Crore, including interest upto November 30, 2016.

Subsequent to London High Court Orders dated April 16, 2018 and May 2, 2018, DGH vide

letter dated May 4, 2018, May 15, 2018, June 4, 2018 and January 14, 2019 had asked for re

casting of accounts of the PMT JV and for remitting the respective Pl share of balance dues

including interest till the date of remittance. As the company is not a party to the arbitration,

the details of the proceedings of arbitration and copy of the order of London High Court are

not available with the company. The Company has responded that as of now, neither the

Arbitral Tribunal nor the London High Court has passed any order or quantified any amount

due and payable by the Company and in the circumstances; the demand of DGH from the

Company for any sum or interest thereon is premature and not justified. In the Company's

view, pending final quantification of liabilities by the Arbitration Tribunal, it is not liable to

implement the Final Partial Award (FPA) being pre-mature and therefore no provision for the

same has been considered necessary and the same has been considered as contingent

liability.

Our conclusion on the Statement and our report is not modified in respect of the above

matter.

Other Matters

7. We have placed reliance on technical/commercial evaluation by the management in respect

of categorization by the Company of wells as exploratory, development, producing and dry

wells, allocation of costs incurred on them, proved (developed and undeveloped)

hydrocarbon reserves and depletion thereof on Oil and Gas Assets, impairment, liability for

abandonment costs, liability for NELP and nominated blocks for under performance against

agreed Minimum Work Programme.

8. We did not review the interim financial information of 18 out of 137 New exploration

licensing policy (NELP)/ Hydrocarbon Exploration and Licensing Policy (HELP)/ Joint

Operations (JO) accounts for exploration and production blocks in respect of NELP /JO

operated by other operators included in the standalone unaudited interim financial results of

the entities included in the Group, whose results reflect total revenues of Rs. � 2,947.29

Crore and profit before tax including other comprehensive Income of� 632.80 Crore for the

quarter ended June 30, 2019. The interim financial information of these joint operations

have been certified by management.

9. We did not review the interim financial results/information in respect of four subsidiaries

included in the consolidated unaudited financial results, whose interim financial

results/information reflect total revenues of� 82,960.07 Crore, total net profit/(loss) after tax

of � 1,542.67 Crore and total comprehensive income of � 1,627.30 Crore for the quarter

ended June 30, 2019 as considered in the consolidated unaudited financial results.

F - 12

These interim financial results/information have been reviewed by other auditors whosereports have been furnished to us by the Management and our conclusion on the Statement,in so far as it relates to the amounts and disclosures included in respect of these subsidiariesand joint ventures is based solely on the reports of the other auditors and the proceduresperformed by us as stated in paragraph 3 above.

Our Conclusion on the Statement is not modified in respect of the above matter.

10. The consolidated unaudited financial results also includes the Group's share of netprofit/(loss) after tax of (� 19.53 Crore) and total comprehensive income of (� 19.53 Crore)for the quarter ended June 30, 2019 as considered in the consolidated unaudited financialresults, in respect of one Associate, based on their interim financial result/information, whichhave not been reviewed by their auditor or by us.

These interim financial results/information are certified by the management. According to theinformation and explanations given to us by the Management, this interim financialresults/information are not material to the Group.

11. The consolidated unaudited financial results do not include the Group's share of netprofit/(loss) after tax and total comprehensive income for the quarter ended June 30, 2019, inrespect of one Associate as the interim financial results / information have not beenfurnished to us. As represented by the Management, the same is not material to the Group.

Our conclusion on the Statement and our report is not modified in respect of the above matters.

For R Gopal & Associates


QL--:-oshi)

·lr.lYUTO'vtM. No. 101533) N: .19101533AAAAAU5485

Place: New Delhi Date: 13th August, 2019

For MKPS & Associates

Chartered AccountantsFi m Reg. No: 302014

For PKF Sridhar & Santhanam LLP

J ' �(,,.�� (V. Kothandarama Partner (M. No. 02 UDIN: 19025973AAJ��})�!'_,..,

� (Rajen Ashar) Partner (M.No. 04 UDIN: 19048243AA

For Dass Gupta & Associates

Chartered AccountantsFirm Reg. No. 000112N

F - 13

OIL AND NATURAL GAS CORPORATION Lll\llTED CIN No. L74899DLl993GOI054 I 55

Regd.Office: Plot No. 5A- 5B, Nelson Mandela Road, Vasant Ku•li, New Delhi, South West Delhi- 110070


STATEMENT OF CONSOLIDATED FINANCIAL RESULTS FOR THE QUARTER ENDED Jorn JUNE, 2019

I n 111 IV

V VI VII Vlll IX X

XI XII

Particulars

Revenue from operations Other income Total income (1+11) Expenses (a) Cost of materials consumed• (b) Purchase of Stock-in-Trade (c) Changes in inventories offinished goods, stock-in-trade and work-in progress (d) Employee benefits expense•• (e) Statutory levies

(f) Exploration costs wrilten off (i) Survey costs (ii) Exploration well costs

(g) Finance costs(h) Depreciation,depletion, amortisation and impaim1ent (i) Other expensesTotal rx11enses (IV)

Profit before share of prolitl(loss) of assoclatts and joint ,•enturu, txceplional ltcnu and tu (lll • IV) Share of profit of associates & joint ventures Profit before uceptlooal Items (V+VI) Exceptional items Profit before tax (VTI+VIII} Tax expense (a) Current tax (b) Earlier Years (c) Deferred tax Total tax upense (X)

Profit for the year (IX•X) Other comprehensive Income (OCI) A Items that will not be reclassified to profit or loss

(a) Remeasurement of the defined benefit plans - Deferred tax

(b) Equity instruments through other comprehensive income • Deferred tax

(c) Share of other comprehensi\•e income in associates and joint ventures, to theextent not to be reclassified to profit or loss

• Deferred tax(d) Effective portion of gains (losses) on hedging instruments in cash flow hedge

n (i) Items that will be reclassified to profit or loss (a) Exchange differences in translating the financial statement of foreignoperation

- Deferred taxTotal Other Com rehensive Income (XII)

XU1 Total Comprehensive Income for the year (Xl+Xfl)

XIV Profit for the year attributable to: - Owners of the Company - Non-controlling interests

XV Other comprehensive income for the year • Owners of the Company • Non-controlling interests

XVI Total comprehensive income for the year - Owners of the Company• Non-controlling interests

XVU Paid up equity share ca111tal (Face value ortS/- each)

XVID Other Equity Earnings per equity share: (Face value of?5/· each)# (a) Basic�)

(b) Diluted{')

Quarter ended June 30, 2019

Unaudited

109,514.82 1,601.84

111,116.66

19,756.30 48,761.69

83.65 1,636.48

12,208.63

952.07 1,468.55 1,520.19 5,847.55 7,760.10

99,995.21

11,121.4S

270.11 11,391.S6

11,391.S6

3,299.03 (13.72)

1,063.56 4,348.87

7,042.69

(113.18) 39.56

(1,338.49) 81.02

(0.50)

0.03

146.11 39.64

1,225.09 5,817.60

6,693.61 349.08

7,042.69

{1,214.84) 10.25

(1,225.09)

5,478.77 338.83

5,817.60 6,290.15

5.32 5.32

Quarter ended l\larch 31, 2019

Unaudited

112,316.40 2,550.39

114,866.79

24,336.93 43,218.45 (3,590.23)

1,765.67 15,238.08

949.69 2,619.28 1,441.28 6,310.37

10,393.20 102,682.72

12,184.07

900.63 13,084.70 1,579.65 11,S05.0S

3,132.43 (45.61)

2,314.75 S,401.57

6,103.48

(753.62) 262.88

3,340.19 (254.72)

(0.62)

(0.10)

(92.08) 48.45

2,550.38 8,653.86

4,380.97 1,722.51 6,103.48

2,530.03 20.35

2,550.38

6,911.00 1,742.86 8,653.86 6,290.15

3.44 3.44

Quarter ended June 30, 2018

Unaudited

110,367.13 1,101.90

111,469.03

23,857.04 41,399.05 (3,818.26)

1,537.64 15,989.82

419.55 764.79

1,582.95 6,072.78 9,669.46

97,474.82

13,994.21

893.86 14,888.07

26.18) 14,861.89

4,401.79 0.01

1,142.43 5,544.23

9,317.66

(21.05) 7.43

(2,642.38) 197.57

0.01

(0.03)

2,241.24 780.76) 997.97)

8,319.69

8,287.15 1,030.51 9,317.66

(983.21) 14.76)

(997.97)

7,303.94 1,015.75 8,319.69 6,416.63

6.46 6.46

Ct In Crore) Year ended

!\fRrch 31, 2019 Audited

453,460.57 8,148.76

461,609.33

104,872.97 165,342.23 (3,094.73)

6,445.16 60,361.00

1,960.70 7,259.95 5,836.72

24,026.22 35,669.21

408,679.43

52,929.90

3,428.26 56,358.16 1,591.01 54,767,1S

15,912.06 (38.12)

5,006.28 20,880.22

33,886.93

(437.22) 152.97

(1,710.81) 126.53

(1.87)

0.02

1,455.38 481.53

(896.53) 32,990.40

30,494.96 3,391.97

33,886.93

(853.10) 43.43

(896.53)

29,641.86 3,348.54

32,990.40 6,290.15

211,850.61

23.81 23.81

F - 14

OIL AND NATURAL GAS CORPORATION U\IITED

CIN No. L74899DLl993GOI0S41SS

Regd.Office: P lot No. SA· SB, Nelson Mandela Road, Vasant Kunj, New D<lhi, South West D<lhi - 110070


CONSOLIDATED SEGMENT \\1SE REVENUE, RESULTS, ASSETS & LIABILITIES !' In Crore)

SI. P1rficul1n Quarttr endtd Quarter roded l\lar<h Quarter ended Ytar tndtd ?\larch

No. June 30, 2019 31 2019 June 30 2018 31, 2019

Unaudittd Unaudiltd Un•udlted Audiltd

I Srgmtnt Rn·tnue

A. In India

(i) E&P

a) Offshore 17,304.94 16,978.S2 18,06S.95 73,0IS.47

b)Onshore 9,194.41 9,729.11 9,088.39 36,4S3.73

(ii) Refuting & Marketing 86,I0S.l7 91,551.94 90,171.37 370,884.46

8. Outside India 4,28S.20 3,662.2S 3,614.46 14,633.62

c) Others Unallocated 29.81 S8.S8 38.87 158.44

Total 116,919.SJ 121,980.40 120,979.04 495,145.72

Less: Inter Segment Revenue 7,404.71 9,664.00 10,611.91 41,68S.IS

Rtnnue from operations 109,514.82 112,316.40 110,367.13 453,460,57

2 Stgment Rtsult Profit(+)/Loss(•) before tax and inter<st from each stgment

A. In India

(i) E&P

a) Offshore 7,517.42 4,480.88 8,449.53 31,028.94

b)Onshore 2,121.41 469.69 2,350.08 8,464.56

(ii) Refining & Marketing 389.29 5,695.63 3,716.93 11,284.54

B. Outside India 2,131.50 281.46 1,191.16 3,671.34

Total 12,159.62 10,927.66 15,707.70 54,449.38

Less:

i. Finance Cost 1,S20.19 1,441.29 l,S82.9S 5,836.73

ii. Other unallocable expenditure net of unal locable income. (482.02) (1, 118.0S) 1S6.72 (2,726.24)

Add: Share or profit/(lou) or joint nnlures and associates:

A. In India

(i) Refining & Marketing 169.61 297.S0 249.8S 834.60

(ii) Una l located (378.33) Sl.29 (142.01) (208.94)

B. Outside lndia-E&P 478,83 SSl.84 786.02 2,802.60

Profit btfore Tn 11,391.56 11,505.05 14,861.89 54,767.15

3 Stgmtnt Assets

A. In India

(i)E&P

a)Offshore 132,0H.78 123,640.31 122,48S.08 123,640.31

b) Onshore 6S,S0l.4S 63,77S.6I 58,208.3S 63,775.61

c) Other Unallocated S2,S83.08 SS,82S.38 51,686.14 SS,82S.38

(ii) Refining & Marketing 138,97S.90 139,353.93 129,277.18 139,353.93

B. Outside India 115,681.51 113,106.82 116,325.22 113,106.82

Total 504,786.72 495,702.05 477,981.97 495,702.05

4 Segmmt Liabilitiu

A. In India

(i) E&P

a) Offshore 38,960.14 31,007.56 31,776.34 31,007.S6

b) Onshore 14,377.18 12.86S.45 11,626.77 12,86S.45

c) Other Unallocated 49,373.S2 5S,S I 1.46 52,992.83 SS,S 11.46

(ii) Refining & Marketing 96,176.19 97,100.98 87,031.04 97,100.98

B. Outside India 64,197.92 62,969.63 66,382.20 62,969.63

Total 263,084.95 259,455.08 249,809.18 259,455.08

Note: Segments have been identified and reported taking into ac<:<>unt the differing risks and returns, the groups structure and the internal reporting systems. These have been organized into the follo\\ing

Geographical and Business segments:

Geographical Segments: a) In India • Offshore and Onshore b) Outside India.

Business Segments : a) Exp loration & Production b) Refining & Marketing of Petroleum products

F - 15

Notes:

1. The above Consolidated financial results have been reviewed and recommended by the Audit

Committee and approved by the Board of Directors in its meeting held on 13th August, 2019.

2. The Consolidated financial results for the quarter ended 30th June, 2019 have been reviewed

by the Statutory Auditors as required under Regulation 33 of the SEBI (Listing Obligations

and Disclosure Requirements) Regulations, 2015.

3. Indian Accounting Standard (Ind AS) 116 "Leases" became effective from April 1, 2019. The

Group has adopted the same and applied to all lease contracts existing on April 1, 2019 using

modified prospective transition method. Accordingly, the comparative info1mation for earlier

periods is not restated. On transition, the adoption of the standard resulted in recognition of

Right-of-Use assets with corresponding equivalent lease liabilities amounting to { 11,300

Crore as at April 1, 2019. Application of this standard has also resulted in a net decrease in

Profit before tax of current period by { 120 Crore.

4. The Company, with 40% Participating Interest (PI), is a Joint Operator in Panna-Mukta and

Mid and South Tapti Fields along-with Reliance Industries Limited (RIL) and BG Exploration

and Production India Limited (BGEPIL) each having 30% PI, (all three together referred to as

"Contractors") signed two Production sharing Contracts (PSCs) with Government of India

(Union oflndia) on December 22, 1994 for a period of 25 years. In December 2010, RIL &

BGEPIL (JV Pm1ners) invoked an international arbitration proceeding against the Union of

India in respect of certain disputes, differences and claims arising out of and in connection

with both the PSCs pursuant to the provisions of Al1icle 33 of the PSCs and UNCITRAL

Rules, 1976. The Ministry of Petroleum and Natural Gas (MoP&NG), vide their letter dated

July 4, 2011, had directed the Company not to participate in the arbitration initiated by the JV

Pmtners. MoP&NG has also stated that in case of an arbitral award, the same will be

applicable to the Company also as a constituent of the contractor for both the PS Cs.

Directorate General of Hydrocarbons (DGH), vide letters dated May 25, 2017 had informed

the Company that on October 12, 2016, a Final Partial Award (FPA) was pronounced by the

Tribunal in the said arbitrations. However, details of proceedings of the FP A are not available

with the Company. DOH, vide their letter dated May 25, 2017 and June 4, 2018, marked to

the Contractors, had directed the payment of differential Government of India share of Profit

Petroleum and Royalty alleged to be payable by Contractors pursuant to Governments

interpretation of the FPA (40% share of the Company amounting to US$ 1,624.05

million, including interest upto November 30, 2016) equivalent to t 11,215 Crore. In

response to the letters of DOH, the JV pmtners (with a copy marked to all Joint Venture

Partners) had stated that demand of DOH was premature as the FPA did not make any money

F - 16

The English Comt has delivered its final verdict on May 2, 2018 following which the Arbitral

Tribunal re-considered some of its earlier findings from the 2016 FPA (Revised Award). The

Government of India, BGEPIL and RIL have challenged paits of the Revised Award.

In January 2018, the Company along with the JV partners has filed an application with MC for increase in CRL in terms of the PSCs. The application has been rejected by MC. Pursuant to the rejection, the N paitners have filed a claim with Arbitral Tribunal.

DOH vide letter dated January 14, 2019 has advised to the contractors to re-cast the accounts

for Panna-Mukta and Mid and South Tapti Fields for the year 2017-18. Pending finalization of

the decision of the Arbitral Tribunal, the JV partners and the Company have indicated in their

letters to DOH that the final recasting of the accounts is premature and the issues raised by

DOH may be kept in abeyance.

Pending finality by Arbitration Tribunal on various issues raised above, re-casting of the

financial statements and final quantification of liabilities, no provision has been accounted in

the financial statements. The demand raised by DGH, amounting to US$ 1,624.05 million

equivalent to� 11,215 Crore has been considered as contingent liability.

5. The Company had received demand orders from Service Tax Department at various work

centres on account of Service Tax on Royalty payments, appeals against such orders have

been filed before the Tribunal. The Company had also obtained legal opinion as per which the

Service Tax/OST on Royalty is not applicable. Meanwhile, the Company also received

demand order dated January 1, 2019 on account of OST on Royalty in the State of Rajasthan

against which the Company filed writ ( 4919/2019) before Hon'ble High Court of Rajasthan.

The Hon'ble High Comt of Rajasthan heard the matter on April 3, 2019 and issued notice to

Department with a direction that no coercive action shall be taken against the Company for

recovery till next date of hearing which is scheduled on August 22, 2019. The Company also

filed writ of mandamus before Hon'ble High Court of Madras seeking stay on the levy of

OST on royalty. The Hon'ble High Comt of Madras heard the matter on April 3, 2019 and the

Department has been allowed to file counter submission and to finalize the representation

(under-protest letter) given by Company to the Department. The next date of hearing which is

scheduled on August 26, 2019. The total estimated amount (including penalty and interest up

to June 30, 2019) works out towards Service Tax is� 3,877 Crore and OST is� 4,438 Crore.

Since the Company is contesting the demand, it has been considered as contingent liability.

Fmther, as an abundant caution, the Company has deposited Service Tax and GST along-with

interest under-protest amounting to� 1,373 Crore and� 3,276 Crore respectively.

6. Previous period's figures have been regrouped, wherever necessary, to conform to cunentquaiter's classification.

Place: New Delhi

Date : 13th August, 2019

By order of the Board

C,.A��y-c (St£h�h Kumarj Director (Finance)

F - 17

F - 18

F - 19

F - 20

F - 21

F - 22

F - 23

F - 24

F - 25

F - 26

F - 27

F - 28

F - 29

F - 30

F - 31

F - 32

F - 33

F - 34

F - 35

F - 36

F - 37

F - 38

F - 39

F - 40

F - 41

F - 42

F - 43

F - 44

F - 45

F - 46

F - 47

F - 48

F - 49

F - 50

F - 51

F - 52

F - 53

F - 54

F - 55

F - 56

F - 57

F - 58

F - 59

F - 60

F - 61

F - 62

F - 63

F - 64

F - 65

F - 66

F - 67

F - 68

F - 69

F - 70

F - 71

F - 72

F - 73

F - 74

F - 75

F - 76

F - 77

F - 78

F - 79

F - 80

F - 81

F - 82

F - 83

F - 84

F - 85

F - 86

F - 87

F - 88

F - 89

F - 90

F - 91

F - 92

F - 93

F - 94

F - 95

F - 96

F - 97

F - 98

F - 99

F - 100

F - 101

F - 102

F - 103

F - 104

F - 105

F - 106

F - 107

F - 108

F - 109

F - 110

F - 111

F - 112

F - 113

F - 114

F - 115

F - 116

F - 117

F - 118

F - 119

F - 120

F - 121

F - 122

F - 123

F - 124

F - 125

F - 126

F - 127

F - 128

F - 129

F - 130

F - 131

F - 132

F - 133

F - 134

F - 135

F - 136

F - 137

F - 138

F - 139

F - 140

F - 141

F - 142

F - 143

F - 144

F - 145

F - 146

F - 147

F - 148

F - 149

F - 150

F - 151

F - 152

F - 153

F - 154

F - 155

F - 156

F - 157

F - 158

F - 159

F - 160

F - 161

F - 162

F - 163

F - 164

F - 165

F - 166

F - 167

F - 168

F - 169

F - 170

F - 171

F - 172

F - 173

F - 174

F - 175

F - 176

F - 177

F - 178

F - 179

F - 180

F - 181

F - 182

F - 183

F - 184

F - 185

F - 186

F - 187

F - 188

F - 189

F - 190

F - 191

F - 192

F - 193

F - 194

F - 195

F - 196

F - 197

F - 198

F - 199

F - 200

F - 201

F - 202

F - 203

F - 204

F - 205

F - 206

F - 207

F - 208

F - 209

F - 210

F - 211

F - 212

F - 213

F - 214

F - 215

F - 216

F - 217

F - 218

F - 219

F - 220

F - 221

F - 222

F - 223

F - 224

F - 225

F - 226

F - 227

F - 228

F - 229

F - 230

F - 231

F - 232

F - 233

F - 234

F - 235

F - 236

F - 237

F - 238

F - 239

F - 240

F - 241

F - 242

F - 243

F - 244

F - 245

F - 246

F - 247

F - 248

F - 249

F - 250

F - 251

F - 252

F - 253

F - 254

F - 255

F - 256

F - 257

F - 258

F - 259

F - 260

F - 261

F - 262

F - 263

F - 264

F - 265

F - 266

F - 267

F - 268

F - 269

F - 270

F - 271

F - 272

F - 273

F - 274

F - 275

F - 276

F - 277

F - 278

F - 279

F - 280

F - 281

F - 282

F - 283

F - 284

F - 285

F - 286

F - 287

F - 288

F - 289

F - 290

F - 291

F - 292

F - 293

F - 294

F - 295

F - 296

F - 297

F - 298

F - 299

F - 300

F - 301

F - 302

F - 303

F - 304

F - 305

F - 306

F - 307

F - 308

F - 309

F - 310

F - 311

F - 312

F - 313

F - 314

F - 315

F - 316

F - 317

F - 318

F - 319

F - 320

F - 321

F - 322

F - 323

F - 324

F - 325

F - 326

F - 327

F - 328

F - 329

F - 330

F - 331

F - 332

F - 333

F - 334

F - 335

F - 336

F - 337

F - 338

F - 339

F - 340

F - 341

F - 342

F - 343

F - 344

F - 345

F - 346

F - 347

F - 348

F - 349

F - 350

F - 351

F - 352

F - 353

F - 354

F - 355

F - 356

F - 357

F - 358

F - 359

F - 360

F - 361

F - 362

F - 363

F - 364

F - 365

F - 366

F - 367

F - 368

F - 369

F - 370

F - 371

F - 372

F - 373

F - 374

F - 375

F - 376

F - 377

F - 378

F - 379

F - 380

F - 381

F - 382

F - 383

F - 384

F - 385

F - 386

F - 387

F - 388

F - 389

F - 390

F - 391

F - 392

F - 393

F - 394

F - 395

F - 396

F - 397

F - 398

F - 399

F - 400

F - 401

F - 402

F - 403

F - 404

F - 405

F - 406

F - 407

F - 408

F - 409

F - 410

F - 411

F - 412

F - 413

F - 414

F - 415

F - 416

F - 417

F - 418

F - 419

F - 420

F - 421

THE ISSUERS

Oil and Natural Gas Corporation Limited

Tower A, Deendayal Urja Bhawan

5, Nelson Mandela Marg, Vasant Kunj

New Delhi – 110 070

India

ONGC Videsh Limited

Tower B, Deendayal Urja Bhawan



India

THE GUARANTOR (IN RESPECT OF GUARANTEED NOTES)

Oil and Natural Gas Corporation Limited

Tower A, Deendayal Urja Bhawan



India

ARRANGERS AND DEALERS

Citigroup Global Markets Limited

Citigroup Centre, 33 Canada Square,

Canary Wharf, London E14 5LB

United Kingdom

Standard Chartered Bank (Singapore) Limited

Marina Bay Financial Centre, Tower 1

8 Marina Boulevard, Level 20

Singapore 018981

LEGAL ADVISERS

To the Arrangers and Dealers as to English law To Citigroup Global Markets Limited as to Indian law

Linklaters Singapore Pte. Ltd.

One George Street #17-01

Singapore 049145

J. Sagar Associates

18 Sprott Road

Vakils House, Ballard Estate

Mumbai, India 400001

To the Issuers and (in respect of Guaranteed Notes) the

Guarantor as to Indian law

To the Trustee as to English law

ZBA

412 Raheja Chambers

213 Nariman Point

Mumbai, India 400021

Linklaters

10th Floor, Alexandra House

18 Chater Road

Central, Hong Kong

China

SINGAPORE LISTING AGENT

Linklaters Singapore Pte. Ltd.

One George Street #17-01

Singapore 049145

TRUSTEE

Citicorp International Limited

20/F, Citi Tower, One Bay East

83 Hoi Bun Road, Kwun Tong

Kowloon, Hong Kong

PRINCIPAL PAYING AGENT AND TRANSFER AGENT REGISTRAR

Citibank, N.A., London Branch

c/o Citibank, N.A., Dublin Branch

1 North Wall Quay

Dublin 1

Ireland

Citigroup Global Markets Europe AG

Reuterweg 16

60323 Frankfurt

Germany

Appendix 1

Terms defined in the Offering Circular have the same meaning when used in this Appendix 1. For the purposes of the issuance of the Notes described in this Pricing Supplement, Condition 7.3 of the

Terms and Conditions of the Notes in the Offering Circular shall be deemed to be deleted in its entirety and

replaced with the following:

“7.3 Redemption upon Change in Control

Following the occurrence of a Change of Control, each Noteholder will have the right to require the Issuer

to redeem all, or some only, of the Notes held by such Noteholder on the Change of Control Redemption

Date at their nominal amount outstanding together with interest (including additional amounts pursuant to

Condition 8 if any), if any, accrued to (but excluding) the Change of Control Redemption Date.

To exercise such right to require redemption of any Notes, the holder of the Notes must deliver such Notes

at the specified office of any Paying Agent, in the case of Bearer Notes, or of any Transfer Agent or the

Registrar, in the case of Registered Notes, on any business day (being, in relation to any place, a day (other

than a Saturday or a Sunday) on which banks and foreign exchange markets are open for business in that

place) at the place of such specified office falling within the notice period, accompanied by a duly signed

and completed notice of exercise in the form (for the time being current and which may, if this Note is held

in a clearing system, be any form acceptable to the clearing system delivered in a manner acceptable to the

clearing system) obtainable from any specified office of any Paying Agent, Transfer Agent or the Registrar

(a “Change of Control Redemption Notice”) and in which the holder must specify a bank account to which

payment is to be made under this paragraph accompanied by such Notes or evidence satisfactory to the

relevant Paying Agent, Transfer Agent or the Registrar, as the case may be, that such Notes will, following

the delivery of the Change of Control Redemption Notice, be held to its order or under its control.

Subject to the receipt of RBI or AD Bank approval, where required, the Issuer shall redeem any such Notes

the subject of the Change of Control Redemption Notices delivered on the Change of Control Redemption

Date.

A Change of Control Redemption Notice given by a holder of any Note shall be irrevocable and no Note

deposited with a Paying Agent, Transfer Agent or the Registrar pursuant to this Condition 7.3 may be

withdrawn without the prior written consent of the Issuer.

None of the Trustee or the Agents shall be required to take any steps to ascertain whether a Change of

Control or any event which could lead to the occurrence of a Change of Control has occurred and none of

them shall be liable to Noteholders, the Issuer or any other person for not doing so.

The Issuer, shall give notice to Noteholders in accordance with Condition 14 and to the Trustee and the

Principal Paying Agent in writing by not later than 15 days following the first day on which it becomes

aware of the occurrence of a Change of Control, which notice shall specify the procedure for exercise by

holders of their rights to require redemption of the Notes pursuant to this Condition 7.3 and shall give brief

details of the Change of Control.


Control means (a) the ownership or control of more than 50 per cent. of the voting rights of the issued

share capital of ONGC or (b) the right to appoint and/or remove all or the majority of the members of

ONGC’s board of directors or other governing body, whether obtained directly or indirectly, and whether

obtained by ownership of share capital, the possession of voting rights, contract or otherwise;

a Change of Control occurs when:

(a) the Government of India ceases to own, directly or indirectly, more than 50 per cent. of the voting rights

of the issued share capital of the Issuer; or

(b) any Person or Persons acting together acquires or acquire Control of the Issuer if such Person or Persons

does not or do not have, and would not be deemed to have, Control of the Issuer on 5 December 2019;

or

(c) the Issuer consolidates with or merges into or sells or transfers all or substantially all of the Issuer's

assets to any other Person, unless the consolidation, merger, sale or transfer will not result in the other

Person or Persons acquiring Control over the Issuer or the successor entity; or

(d) one or more Persons (other than any entity or Person referred to in sub-paragraph (b) above) acquires

the legal or beneficial ownership of all or substantially all of the Issuer's issued share capital;

“Change of Control Redemption Date” means the fourteenth day after the expiry of such period of 30

days after the later of a Change of Control or the date upon which notice of a Change of Control is given to

Noteholders by the Issuer in accordance with Condition 14 as referred to above;

Person includes any individual, company, corporation, firm, partnership, joint venture, undertaking,

association, organisation, trust, state or agency of a state (in each case whether or not being a separate legal

entity) but does not include the Issuer’s board of directors or any other governing board and does not include

the Issuer’s wholly-owned direct or indirect subsidiaries.

The Issuer will obtain the prior approval of the RBI or the AD Bank, if required, in line with ECB Guidelines

before providing notice for or effecting such a redemption prior to the Maturity Date; however, such

approval may not be forthcoming.”.

The following replaces the second sentence of the third paragraph of the section “Investment Considerations – Risks Relating to the Company’s Business – Certain countries in which the Company operates, such as Libya, Iran, Iraq, Russia, Sudan, South Sudan, Syria and Venezuela, are subject to U.S. and international trade restrictions, economic embargoes and sanctions.” of the Offering Circular: “For the 2020 Fiscal Year, the Company’s budgeted capital expenditure in these countries is estimated to be approximately Rs. 30,091 million, representing approximately 7.62 per cent. of budgeted capital expenditure of the Company (non-consolidated) and ONGC Videsh. The Company’s activities with respect to these countries and persons subject the Company and its shareholders to a number of risks.” The following replaces the eighth paragraph of the section “Investment Considerations – Risks Relating to the Company’s Business – Certain countries in which the Company operates, such as Libya, Iran, Iraq, Russia, Sudan, South Sudan, Syria and Venezuela, are subject to U.S. and international trade restrictions, economic embargoes and sanctions.” of the Offering Circular: “With respect to ONGC Videsh specifically, ONGC Videsh, directly or through its subsidiaries, holds participating interests in exploration projects in Iran, Libya, Iraq and Myanmar, as well as discovered/producing projects in Myanmar, Russia, South Sudan, Syria and Venezuela.” The following shall be included in the section “Business – Recent Developments” of the Offering Circular: “With effect from 31 August 2019, ONGC Videsh through its wholly-owned subsidiary, ONGC Nile Ganga

B.V., had exited from the Greater Nile Oil Project in Sudan in entirety and ONGC Nile Ganga B.V. no

longer held a participating interest in said project (the “Withdrawal Event”). Accordingly, all disclosure

references in respect of the Company’s operations in Sudan or participation in the Greater Nile Oil Project

in Sudan and/or GNPOC are to read in conjunction with and in light of the Withdrawal Event.

On 3 September 2019, the Company experienced a fire outbreak (the “Uran Fire Incident”) at the Uran

Plant. As a result of the fire outbreak, the Company’s gas processing was restricted to maintain supplies to

internal power generation and also to meet the requirements of Mahanagar Gas Limited and the remaining

gas supply were diverted to the Company’s other processing unit at the Hazira Plant. While the Company

was able to control the fire outbreak within a short span of time with the support and assistance of Mutual

Aid Resource Group, three Central Industrial Security Force fire personnel and the Company’s resident

production superintendent succumbed to fatal injuries. The Company’s offshore crude supply was not

affected by the Uran Fire Incident and the impact of fire in the local vicinity at the Uran Plant was minimal.

Following the Uran Fire Incident, the Company had arranged for a temporary shutdown of the gas

processing units immediately in order to assess the condition of the facilities in the vicinity at the Uran Plant.

After adequate safety assessments, the gas processing units commenced operations from 7 September 2019.

The Company has concluded that the fire outbreak was a result of flooding at the Uran Plant due to heavy

rains. The Company is currently evaluating the Uran Plant’s water drainage system with a view to

preventing similar incidents in the future. Moreover, the Company has instituted training protocols for all

employees at the Uran Plant to better educate them on standard operating procedures applicable during

similar situations.

The Uran Plant is covered under the Company’s insurance policy for its on-shore operations which has a

minimum deductible of Rs. 100 million. The insurance providers are currently assessing the loss caused by

the Uran Fire Incident.

Prof. Shireesh B. Kedare, Shri K. M. Padmanabhan and Shri Ajai Malhotra retired as Independent Directors

of the Company on 19 November 2019. The Company has requested the Government of India to appoint

three Independent Directors on the Company’s board of directors.”

The following shall be included in the first page of the Offering Circular:

“An application may be made for the Programme or any subsequent listing of the Notes under the

Programme on the India International Exchange (IFSC) Limited (the “INX”). The INX has not approved or

verified the contents of this Offering Circular.”

The following shall be included in the section “Summary of the Programme - Listing” of the Offering

Circular:

“An application may be made for the Programme or any subsequent Notes issued under the Programme to

be listed on the INX. Any Notes if listed on the INX will be accepted for clearance through Euroclear and

Clearstream, Luxembourg.”

The following shall be included in the section “General Information – Listing” section of the Offering

Circular:

“An application may be made for the Programme or any subsequent Notes issued under the Programme to

be listed on the INX, will comply with the SEBI (International Financial Service Centres) Guidelines, 2015,

as amended from time to time. In the event the Notes are listed on the INX, the Issuer will make an

announcement on the INX that will include all material information with respect to the delivery of the Notes

issued in definitive form.”

The first paragraph of the Offering Circular section “Subscription and Sale – India”, shall be deleted and

the following shall be added:

“Each Dealer has represented and agreed and each further Dealer appointed under the Programme will be

required to represent and agree that (a) this Offering Circular has not been and will not be registered,

produced or published as an offer document (whether as a prospectus or statement in lieu of prospectus in

respect of a public offer or an information memorandum or private placement offer letter or other offering

material in respect of a private placement under the Companies Act 2013, as amended from time to time

and the rules framed thereunder or any other applicable Indian laws) with the Registrar of Companies, the

Securities and Exchange Board of India, any Indian stock exchange or any other statutory or regulatory

body of like nature in India, except any information from part of this Offering Circular which is mandatorily

required to be disclosed or filed in India under any applicable Indian laws; (b) the Notes have not been and

will not be offered or sold in India by means of this Offering Circular or any document other than to persons

permitted to acquire the Notes under Indian law, whether as principal or agent, and (c) neither this Offering

Circular nor any other offering document or material relating to the Notes has been and nor will it be

circulated or distributed, directly or indirectly, to any person or the public in India or otherwise generally

distributed or circulated in India which would constitute an advertisement, invitation, offer, sale or

solicitation of an offer to subscribe for or purchase any securities in violation of applicable Indian laws for

the time being in force. The Notes have not been offered or sold and will not be offered or sold in India in

circumstances which would constitute an offer of securities (whether to the public or by way of private

placement) within the meaning of the Companies Act 2013 or any other applicable Indian laws for the time

being in force. Each Dealer represents and agrees that in relation to any issuance of Indian Issuer Notes, this

Offering Circular or any other material relating to such Indian Issuer Notes has only been circulated or

distributed to investors meeting the ECB Investor Requirements. Other requirements as specified by the

RBI from time to time may apply. The Notes will not be offered, directly or indirectly, in Gujarat

International Finance Tec-City IFSC, India (“GIFT IFSC”) or to, or for the account or benefit of any person

who is a resident in GIFT IFSC.”

Offering Circular - India INX

Documents

Transcript of Offering Circular - India INX