The Cabinet Committee on Economic Affairs has given its approval to an acquisition by ONGC Videsh Ltd (OVL), the overseas investment arm of ONGC, for 11 per cent stake in JSC Vankorneft from Rosneft Oil Company (Rosneft), Russia’s national oil company. OVL will be paying $930 million for acquiring 11 per cent stake in Vankorneft.
Rosneft operates the Vankor fields with Vankorneft, its wholly-owned subsidiary. The acquisition of stake in Vankorneft will provide 3.2 Million Tonnes of Oil Equivalent (MMTOE) to OVL by 2017. It will also provide an opportunity to the Indian public sector oil and gas companies to acquire new technologies from Rosneft.
The acquisition is in line with Bharat Petro Resources Ltd (BPRL)Market capitalization: Infosys loses fifth spot to ONGC’s stated objective of adding high quality international assets to India’s exploration and production portfolio and, thereby, augmenting India’s energy security. Recently, an Indian consortium comprising Oil India Ltd (OIL), Indian Oil Corporation Ltd (IOCL) and Bharat Petro Resources Ltd (BPRL) acquired 23.9 per cent stake in Vankorneft at a cost of $2020.35 million, which will give them 6.56 MMTOE. Earlier in May 2016, OVL completed the formalities for acquisition of 15 per cent stake in Vankorneft at a cost of $1.284 billion, which gave OVL 4.11 MMTOE.