ONGC Videsh Ltd and Rosneft announced the signing of an ‘Agreement of Confirmation’ in relation to the Indian company’s 15 per cent stake purchase in the Vankor oil fields in East Siberia, Russia.
The signing was announced during Prime Minister Narendra Modi’s visit to Russia. Besides, this 15 other agreements were signed between companies of the two countries including those in the field of nuclear power and defence.
ONGC Videsh, the overseas investment arm of ONGC said in a statement that the signing of the agreement comes after the successful completion of the first stage pre-completion actions in relation to the creation of a joint venture ‘Vankorneft’.
“The document was signed in continuation of the agreement of sale and purchase of a 15 per cent share in Vankorneft and the shareholders agreement in regard of the enterprise management which were signed in September. The parties intend to complete the transaction upon obtaining the necessary regulatory and other approvals,” OVL’s statement said.
It is understood OVL will pay $1.26 billion for the 15 per cent stake in Vankorneft, the subsidiary of Rosneft which operates the Vankor oil field. The initial recoverable reserves of the Vankor field by the January 1st 2015 are estimated at 476 million tonne of oil and condensate and 173 billion cubic meters of gas. The acreage of the field is 447 square km.
In 2014 Vankor produced 22 million tonne of oil which exceeds the results of 2013 by more than 3 per cent. The daily output is more than 60, 000 tonne.
The Russian national oil company Rosneft and ONGC also signed a memorandum of understanding for cooperation for geological survey, exploration and production of hydrocarbons onshore and on the continental shelf of Russia.
Commenting on the signed documents D K Sarraf, Chairman and Managing Director, ONGC said, “This takes the cooperation between the two companies to a whole new level and lay strong foundation for enlarging the energy cooperation between two nations.”