New Delhi: State-owned Oil and Natural Gas Corp (ONGC) on Thursday said it plans to raise up to $2 billion in overseas borrowings through a unique and flexible, Singapore-listed debt instrument that provides it with an option to raise funds at short notice. The funds so raised can be used to repay about Rs 15,000 crore of the company’s existing borrowings, fund acquisitions or meet project/asset expenses. In a press statement, ONGC said it has “set up a Euro Medium Term Note (EMTN) programme of $2 billion which will be listed on the Singapore Stock Exchange.” Also Read – Thermal coal import may surpass 200 MT this fiscalThe EMTN programme would enable ONGC or any of its named subsidiaries to go to market at short notice, say 5 to 10 days, to borrow funds any number of times within a one-year period. For the current EMTN programme, ONGC, its overseas arm ONGC Videsh Ltd (OVL) or its subsidiaries can access the market. As on June 30, ONGC had a borrowing of about Rs 15,000 crore while another Rs 42,000 crore debt was on OVL books. ONGC, India’s top oil and gas producer, is implementing multi-billion dollar projects within the country to bring to production new discoveries or prolong output from existing fields. Its overseas arm is on the prowl for acquisitions besides having funding requirements for the 41 projects it has in 20 countries. Also Read – Food grain output seen at 140.57 mt in current fiscal on monsoon boostBoth companies have accumulated debt on their books because of acquisitions they made in recent times. ONGC exhausted all its cash and became a net debt company last year when it bought government stake in Hindustan Petroleum Corp Ltd (HPCL) for Rs 36,915 crore and Gujarat government firm GSPC’s stake in a KG basin field for Rs 7,738 crore. “An EMTN programme is an uncommitted facility and any drawdown thereof under this document would be subject to funding requirements,” the statement said. “This is a landmark achievement for ONGC as it is amongst select few corporates and India’s first oil and gas public sector integrated energy major to set up an EMTN programme.” ONGC chairman and managing director Shashi Shanker said the EMTN programme is a landmark achievement for ONGC as it would further enhance the company’s credit profile amongst global investor base. “We have embedded structural features in the programme which would allow ONGC, ONGC Videsh or its subsidiaries to access international markets within a shorter time frame,” he said. “We do believe this programme will assist in meeting our strategic financing requirements for our organic or inorganic growth prospects due to our vision of becoming an integrated energy major of global reckoning.” A euro medium-term note is a medium-term, flexible debt instrument that is traded and issued outside of the US and Canada. These instruments require fixed payments and are directly issued to the market with maturities that are less than five years. “Current low yield environment in international debt markets does provide attractive tenor funding options, however any drawdown under the programme will be made to meet specific requirements of ONGC, OVL or its subsidiaries,” said Subhash Kumar, Director (Finance), ONGC. The EMTN programme, he said, would allow ONGC to access international bond markets opportunistically to meet its funding requirements.