OVL's stake buy in Vankor fields gets govt nod

Vankor is Rosneft's second largest field in terms of productions and accounts to 4 per cent of Russia's production

The Cabinet Committee on Economic Affairs on Wednesday gave its nod to the acquisition of 11 per cent stake in Russia’s Vankor oil fields by ONGC Videsh (OVL) from Rosneft Oil Company for $930 million, which will take its overall stake in the project to 26 per cent.  

OVL, the overseas arm of state-owned Oil and Natural Gas Corp (ONGC), had bought a 15 per cent stake in the field for $1.268 billion last year.

The acquisition will provide 3.2 million tonne of oil equivalent (mtoe) to OVL by 2017. This takes the overall stake of Indian companies in the field to 49.9 per cent. Petroleum Minister Dharmendra Pradhan said on Wednesday that Indian firms were also looking to buy some stake in Vankor cluster.

“It will also provide an opportunity to Indian public sector oil and gas companies to acquire new technologies from Rosneft. The acquisition is in line the ONGC’s stated objective of adding high quality international assets to India's exploration and production portfolio and thereby augmenting India’s energy security,” the government said. Recently, an Indian consortium comprising Oil India, Indian Oil Corporation and Bharat Petro Resources acquired 23.9 per cent in Vankorneft at a cost of $ 2.02 billion.

Vankor is Rosneft’s second largest field in terms of production and accounts for four per cent of Russia’s production. The field produces 421,000 barrels per day (bpd) of crude oil on an average and OVL's overall share of daily oil production from Vankor will be 110,000 bpd.

“In the past 50 years, governments had shelved $28.486 billion to secure about 10 mtoe of hydrocarbon assets, while in this short time, we have spent $5.46 billion to secure 15.18 mtoe for India,” said Pradhan.

He added that India was also in talks with Russia to have a gas pipeline between the countries. Meanwhile, the Cabinet also approved HLL Lifecare, a mini ratna public-sector under the ministry of health and family welfare to sub-lease 330.1 acres of land at Chengalpattu near Chennai to set up a medical devices manufacturing park.

The other major decision by the Cabinet was approval to the amendments to the HIV and AIDS Bill, 2014, drafted to safeguard the rights of people affected by HIV. The Bill lists various grounds on which discrimination against HIV positive persons and those living with them is prohibited. These include denial, termination, discontinuation or unfair treatment in employment, educational establishments, health care, standing for public or private office, and provision of insurance.