Towards Energy Security: ONGC Videsh To Buy 11% Stake In Russian Oil Fields

The Indian government has approved Oil and Gas Corporation’s (ONGC) acquisition of 11 per cent stake in Russia’s state-run Vankor oil fields for $930 million.

ONGC Videsh, the overseas arm of India’s ONGC, already has a 15 per cent state in the fields worth $1.268 billion.

‘This acquisition will provide 3.2 million tonnes of oil equivalent (MTOE) to ONGC Videsh by 2017,’ a petroleum ministry statement here said. In the statement, the ministry also stated that it will also provide an opportunity to Indian public sector oil and gas companies to acquire new technologies from Rosneft.

Capacity shortage and lack of modern technology remain the most important shortfalls in India’s indigenous oil industry. With this investment, Indian firms will get access to some of the world’s best technology and will contribute to capacity building of the local industry. Moreover, the worsening situation in the Middle-East poses great danger to India’s energy supplies. But diversifying its sources of energy, the government is limiting dependence on one single entity.

The daily production from Vankor is around 421,000 barrels per day (bpd) of crude oil on an average. Together with the earlier acquisition of 15 per cent, ONGC’s share of daily oil production from the oil field will be about 110,000 bpd.

With Inputs From IANS