New Delhi, Aug. 20 (PTI): Steel tycoon Lakshmi N. Mittal may have acquired Arcelor, but his ambition to make it big in the oil and gas sector is coming unstuck as ONGC doesn’t appear keen on a venture the two had agreed upon last year.

Mittal had written to the government last week about delays in the shaping up of the ONGC-Mittal Energy Services Ltd, a joint venture that was to trade and ship oil and gas (including LNG), sources said.

After the exit of Subir Raha, ONGC has reversed several decisions of the July 2005 MoU.

Sources said ONGC has refused deputation of its employees to ONGC-Mittal Energy Ltd — the company formed to acquire oil and gas properties abroad — and ONGC-Mittal Energy Services.

It has also reversed the decision to open an office in Delhi, sources said, adding the firm this month cancelled interviews for recruitment to ONGC-Mittal Energy. The Mittal letter pointed to delays by ONGC to register oil companies with ONGC-Mittal Energy Services, a pre-requisite to begin trading in crude oil and petro products.

The delays have prompted Mittal to hold talks with firms such as Chevron and Exxon Mobil for an oil-trading venture.

Sources said ONGC was willing to continue with ONGC-Mittal Energy, but with a skeletal staff.

On ONGC-Mittal Energy Services, the PSU’s new management has privately said it would prefer to exit from it as oil-trading does not form ONGC’s core competence.

A senior ONGC official said oil trading was an unrelated business activity and as such required parent company guarantees.

“Extending parent company guarantees to an unrelated business is something the board will have to decide,” the official said.

The two ventures with Mittal Steel were part of an ONGC vision to become a $50-billion company by 2010.

Besides global footprint, the company had planned downstream forays into oil refining, retailing, petrochemicals and LNG business.

However, the downstream projects have come under the oil ministry scanner and a couple of them like fuel-retailing and new refinery at Kakinada have already faced the axe.

Sources said Mittal was frustrated over the delays in shaping of the ventures despite the success ONGC-Mittal Energy had in acquiring two oil fields in Nigeria.