In its largest acquisition, ONGC Videsh Ltd, the wholly owned subsidiary of ONGC, today signed an agreement to acquire a deepwater offshore oil field in Angola for $600 million. The oil field will start gushing oil by 2007 and is expected to achieve a peak production of more than 2,00,000 barrels of oil per day. | |
| ONGC in a press release said: "An agreement has been reached between ONGC Videsh Ltd and Shell Development Angola BV for ONGC Videsh Ltd's acquisition of Shell's entire 50 per cent interest in the deep-water offshore Block 18 in Angola, including the Greater Plutonio development." |
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| Atul Chandra, managing director of ONGC Videsh Ltd, told Business Standard: "It is the largest investment of the company. We are looking at oil equity abroad and will achieve 20 million tonnes of overseas oil equity by 2010." |
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| The recent acquisition will result in ONGC acquiring at least 5 million tonnes of oil from the Angola field. |
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| ONGC Videsh Ltd has several projects across different parts of the globe. It bought its first equity oil in Sudan in May 2003, a 25 per cent equity in the Greater Nile Oil Project, from Talisman BV, Amsterdam. In Russia, it has stakes in one of the largest oil and gas fields in offshore Sakhalin. |
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| ONGC Videsh produces gas from two offshore fields in Vietnam. In Iraq, OVL is the sole licencee in an onland exploration block while it has a 40 per cent stake as operator in an exploration and development contract for an exploration block in Iran. Besides, in Myanmar, the company has a 20 per cent stake in an offshore exploration block. |
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| Chandra pointed out that by 2007, OVL will have an oil equity abroad of at least 15 million tonnes. |
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| ONGC's Angola acquisition is expected to be complete later this year " subject to approvals from Angola government and Sonangol, and pre-emption rights of BP and Sonangol. The consideration for the transaction will be around $ 600 million, assuming completion in middle of 2004", the release added. |
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| The Greater Plutonio project, involving the development of six fields in water-depths ranging between 1,200 to 1,500 metres, will be the first development in Angola's Block 18. |
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| The project is operated by BP, and will consist of a single spread-moored floating, production, storage, and offloading (FPSO) vessel linked by risers to a network of sub-sea flow-lines, manifolds and wells. BP recently received authorisation from Sonangol to proceed with the awarding of major contracts. |
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