OVL picks up two more blocks in Cuba

ONGC Videsh Ltd (OVL) has increased its overseas asset portfolio by signing a production-sharing contract with Cuba's state oil company, Cuba Petroleos (CUPET), for deep-water exploration in two blocks. The company already has stakes in six offshore blocks in that country.

The two offshore exploration blocks, N-34 and N-35, are located in Cuba's exclusive economic zone. "Cuba offers very promising exploration play, and OVL is pleased to enhance its investments in the country. The execution of the production-sharing contract for the blocks marks OVL's entry as an operator in Latin America, which will give a fillip to its activities in the region," OVL Managing Director RS Butola said.

According to the deal, CUPET and OVL will explore the two blocks, which cover an area of 4,300 sq km. The deal has been spread over six years and will be conducted in three phases.

While the Cuban government has the option to take a 20 per cent participating interest in the blocks, OVL will be their operator.

"The blocks are located in a very favourable geological set-up and are estimated to hold considerable hydrocarbon resources," ONGC said.