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22. To ascertain whether ONGC held a position of dominance in the relevant market, the DG considered the explanation provided under Section 4 of the Act along with the factors enlisted under Section 19(4) of the Act. The DG observed that ONGC is the largest producer of crude oil and natural gas in India, contributing almost 70% to India's domestic production of oil.

23. The DG also noted that in the past 5 years, ONGC had chartered/operated, approximately 80% of the offshore drilling rigs in the Indian EEZ. Further, as on 01.01.2018, 45 out of the 48 contractually committed/operational offshore drilling rigs in the Indian EEZ were being chartered/operated by ONGC. As on 11.01.2018, there were 84 contractually committed/operational OSVs in India, out of which 69 were chartered by ONGC amounting to a market share of 82% in the market for charter hire of OSVs in the Indian EEZ.

74. With regard to alleged abuse, ONGC agreed with the finding of the DG. To counter Informant's objections to such finding, ONGC adopted a three- legged argument. It, firstly, argued that clause 14.2 of the SCC which provides it a unilateral right of termination is fair and justified, when read in context of the underlying risk that it is exposed to. To support this contention, ONGC highlighted various risks which it is exposed to, being in the E&P business. It was submitted that ONGC bears the geological risk, i.e. the difficulty of extraction and the possibility that accessible reserves in any deposit will be smaller than estimated. Therefore, if in an unfortunate event, the estimates of reserves at the drilling rigs are not as expected, ONGC may be forced to abandon the project. Beyond the geological risk, the other risk is the price of oil and gas which is a determining factor in deciding whether a reserve is economically feasible or not. Basically, the higher the geological barriers to easy extraction, the higher the price risk a given project faces. However, this does not mean that oil and gas companies automatically cease operations on a project that becomes unprofitable due to a price dip. Apart from the price risk of a project, the uncertainty of the worldwide price of crude oil is also a determining factor in the commencement and continuity of projects. Therefore, E&P companies need to guard against such risks and keep the costs of projects within the budgeted estimates to ensure sustainability of E&P projects. Often these projects cannot be shut down immediately and then restarted due to the sheer scale of such projects. Thus, given all these risks associated with the operations being carried out by ONGC, it was justified in issuing de-hiring notices to reduce its operating cost upon the discovery of lower charter hire day rates in the fresh tenders.

122. It was observed that in the past five years ONGC has operated 80% of the offshore drilling rigs in the Indian EEZ. Further as on 1.1.2018, 45 out of 48 contractually committed /operational offshore drilling rigs in Indian EEZ are chartered/operated by ONGC. Also, as per 11.1.2018, there are 84 contractually committed/operational OSVs in Indian EEZ, out of which 69 are chartered by ONGC amounting to a market share of 82% in the market for charter hire of OSVs. The investigation further revealed that as of 06.12.2018, 65 AHTSVs were employed in the Indian OSV market, out of which 41 were employed by ONGC, accounting for 63.1% of the market share. British Gas employed 5 AHTS ships followed by 2 AHTS ships employed by Cairn Energy. In case of PSVs, 34 vessels were employed in the Indian OSV market, out of which 31 were employed by ONGC, accounting for 91.2% of the market share in 2018. The remaining three PSVs were employed by Gujarat State Petroleum Corporation (GSPC), Axxis Geo Solutions and McDermott during the year. Over the last six years, OSV employment in India clearly indicated that the Indian OSV market is substantially dominated by ONGC as the company accounts for a significant part of offshore oil and gas production in the country. Thus, at the buying end, ONGC possesses a very high market share for drilling rigs which indicates its dominance in the relevant market.

125. Further, as revealed by the DG in the Investigation Report, being vertically integrated, ONGC is a strong player with significant market power. ONGC is present at all stages of the value chain in the E&P industry and operates maximum number of operational drilling rigs in the Indian EEZ, consequently hiring the maximum number of OSVs. Further, it owns and operates more than 26,600 kilometers of pipelines in India, including sub- sea pipelines. ONGC also owns few drilling rigs and OSVs and has interests in petrochemical and power businesses.