CCEA approves OVL’s proposal to buy 11% stake in JSC Vankorneft

The Cabinet Committee on Economic Affairs (CCEA) has given approval ONGC Videsh Limited (OVL) proposal to buy 11% stake in JSC Vankorneft.
OVL will buy this stake in JSC Vankorneft from Rosneft Oil Company (Rosneft), National Oil Company of Russia which operates Vankor oil fields.
OVL will pay US 930 million dollars for acquiring 11% stake in Vankorneft. This acquisition is also in line with ONGC’s stated objective of adding high quality international assets to India’s Exploration and Production (E&P) portfolio for augmenting India’s energy security.
Benefits

• Provide OVL 3.2 Million Metric Ton of Oil Equivalent (MMTOE) by 2017.
• Provide opportunity to Indian Oil and Gas companies especially PSUs to acquire new technologies from Rosneft.

Background

• Earlier in May 2016, OVL had completed the formalities on acquisition of 15% stake in Vankorneft at a cost of US 1.284 billion dollars which gave OVL 4.11 MMTOE.
• Besides, consortium of Indian oil companies comprising of Indian Oil Corporation Limited (IOCL), Oil India Limited (OIL) and Bharat PetroResources Limited (BPRL) had acquired 23.9% stake in Vankorneft at a cost of US 2020.35 million dollars which gave them 6.56 MMTOE.

Month: Current Affairs - October, 2016