India’s biggest oil explorer ONGC will buy 15 per cent stake in Russia’s second biggest oil field Vankor in a transaction estimated to cost up to $1.3 billion.
This is the fourth largest overseas acquisition by ONGC. The company expects to get over three million tonnes of oil from the field in a year.
“ONGC Videsh signed definitive agreements to acquire up to 15 per cent shares in CSJC Vankorneft, a company organised under the law of Russian Federation which is the owner of Vankor Field and the NorthVankor licence,” ONGC Videsh said in a statement. OVL is the overseas arm of ONGC.
“Rosneft Oil Company, NOC of Russia holds 100 per cent shares in Vankorneft. The acquisition is subject to relevant board, government and regulatory approvals and is expected to close by mid of 2016,” the statement said.
Both OVL and Rosneft did not reveal the value of the deal, but a source privy to the transaction said that OVL will pay around $1.3 billion.
Vankor is Rosneft’s (and Russia’s) second largest field by production and accounts for four per cent of Russian production. The daily production from the field is around 442,000 bpd of crude oil on an average with ONGC Videsh’s share of daily oil production at about 66,000 bpd, OVL said. The present transaction provides an opportunity to ONGC Videsh to enhance its presence in Russia.
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