NEW DELHI: The Cabinet Committee on Economic Affairs chaired by Prime Minister Narendra Modi on Wednesday approved a proposal from the Ministry of Petroleum and Natural Gas to allow ONGC Videsh Ltd (OVL) to pick up an additional 11 per cent stake in Russia’s Vankor oil field for $930 million.
The acquisition of stake in Vankorneft will provide 3.2 million tonnes of oil equivalent to OVL by 2017. It will also provide an opportunity to Indian public sector oil and gas companies to acquire new technologies from Rosneft.
The Vankor fields are Rosneft’s second largest in terms of production. On average the field produces around 4,21,000 barrels per day of crude oil and OVL’s overall share of daily oil production from Vankor will be about 1,10,000 barrels per day (bpd).
“The acquisition is in line with the ONGC’s stated objective of adding high quality international assets to India’s exploration and production (E&P) portfolio and thereby augmenting India’s energy security,” an official statement said.
OVL, the overseas arm of state-owned Oil and Natural Gas Corporation (ONGC), had in May completed acquisition of 15 per cent in Vankor oil field for $1.28 billion. Rosneft operates the fields through its wholly-owned subsidiary, Vankorneft. “OVL will be paying an amount of $930 million for 11 per cent stake in Vankorneft,” it said.
Besides OVL’s 26 per cent stake in Vankor, a consortium comprising Oil India (OIL), Indian Oil Corporation (IOC) and Bharat PetroResources (BPRL) acquired 23.9 per cent stake in Vankorneft at a cost of $2.02 billion, which will give them 6.56 mt of oil.