The Hindu Business Line : OVL, PetroEcuador ink MoU for co-operation in hydrocarbon sector

India and Ecuador would jointly bid for oil and gas exploration areas in the Latin American country and other countries like Kazakhstan and Russia. ONGC Videsh Ltd (OVL), the overseas arm of Oil and Natural Gas Corporation, and PetroEcuador, Ecuador's state oil company signed a memorandum of understanding for co-operation in energy sector with the objective of developing and promoting petroleum, gas, electricity, petrochemical, external hydrocarbon commercialisation, geological and petroleum research.

PetroEcuador and OVL would collaborate in exploration and exploitation of hydrocarbons in Ecuador on mutually agreed terms, as per the agreement.

Joint Bid

"Such collaboration will include establishment of joint ventures for exploration and exploitation of hydrocarbon in existing and new concessions with a view to increase production," it said. The first such project would be a joint bid with PetroEcuador for the Ishpingo-Tambococha-Tiputini (ITT) block in Ecuador. The Government of Ecuador is likely to come out with a tender inviting bids to explore the ITT, an onshore block bordering Peru, the OVL's Managing Director, Mr R.S. Butola, said adding that the block is estimated to have recoverable reserves of one billion barrels of oil equivalent and total reserves in the block could be as high as five billion barrels oil equivalent.

Contract Negotiations

According to the MoU, OVL shall assist PetroEcuador on mutually agreed terms in areas of contract negotiations related to the exploration and hydrocarbon production and constitution of joint venture companies. Besides, participation in blocks, OVL shall train Ecuadorian national in research and development institutes of ONGC/OVL in areas of exploration, production, safety, environmental management, and external petroleum commercialisation.

The MoU was signed in the presence of the Petroleum and Natural Gas Minister, Mr Murli Deora, and the Minister for External Relations of Ecuador, Mr Francisco Carrion. "We are seeking more active participation from ONGC," the External Relations Minister said. He said that Ecuador is also thinking of making another refinery, which would be the fourth in the country.