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A consortium of Indian state-run oil firms including Indian Oil Corporation Ltd, Oil India Ltd, Bharat PetroResources Ltd, and ONGC Videsh Ltd are “in discussions” to buy stakes in Russia's Vankor cluster oilfields, D Rajkumar, chairman and managing director of Bharat Petroleum Corporation Ltd (BPCL) has said.
The managing director of Bharat PetroResources Ltd (BPRL), Ajay Kumar V, is part of an Indian delegation led by Petroleum Minister Dharmendra Pradhan currently in Russia ahead of a planned visit of prime minister Narendra Modi to attend the Eastern Economic Forum in Vladivostok and hold the annual bilateral summit with Russian President Vladimir Putin.
“They are currently holding discussions (for buying stakes), but it’s too early for me to say anything,” Rajkumar said at a media conference on Friday.
The Indian consortium is eyeing stakes in the Suzunskoye, Tagulskoye and Lodochnoye fields - collectively known as Vankor Cluster.
Vankorneft, a subsidiary of Rosneft, Russia’s state-run oil company, is developing the Vankor oil and gas condensate field, situated in the northern part of Eastern Siberia.
Earlier deals
In 2013, Vankorneft was given the mandate to develop the new fields of Vankor cluster - Suzunskoye, Tagulskoye and Lodochnoye fields, located close to the Vankor field.
In 2016, ONGC Videsh Ltd (OVL) bought a 15 per cent stake in Vankor, Russia's second-biggest oilfield, for $1.268 billion followed by another 11 per cent for $930 million.
In the same year, the consortium of OIL-IOC-BPRL acquired a 23.9 per cent stake in the field for $2.02 billion, giving them 6.56 million tonnes of oil. Rosneft holds the remaining 50.1 per cent shares of JSC Vankorneft, the company operating the field with recoverable reserves of 2.5 billion barrels.
The OIL-IOC-BPRL consortium purchased another 29.9 per cent stake in a separate Taas-Yuryakh oilfield in East Siberia for $1.12 billion.
These investments will give India 15.18 million tonnes of oil equivalent.
Vankor produces about 442,000 barrels of oil per day (4 per cent of Russian crude oil production) while Taas currently produces about 21,000 barrels per day of oil.
Rajkumar said that Rosneft is now looking at a larger field or a larger cluster combining the Vankor fields with some other fields to form an eastern cluster in eastern Siberia, in which the Indian consortium is looking to pick stakes.
In FY 19, BPRL’s equity oil share in JSC Vankorneft was 1.25 million metric tonnes of oil and 0.56 billion cubic metres of gas and it received a dividend of around $82 million.
Its equity oil share from the Taas-Yuryakh oilfield was 0.32 MMT of oil and 0.11 BCM of gas and earned a dividend of about $45 million.
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