Iran's gigantic South Pars gas field in the Persian Gulf is being planned to be developed in 24 phases with Phase-12 being dedicated to the Iran LNG project, which is wholly owned by National Iranian Oil Co.
The project is designed for an initial capacity of two trains of 5 million tons of LNG per year each.
"ONGC will get half of Iran LNG (output) provided that invest double of that share in upstream field development," the Iranian Minister said on sidelines of the 19th World Petroleum Congress here.
So, if Hinduja-OVL are to take half of the total LNG output - 5 million tons - they will have to bear the entire expense of developing the field.
"We are in discussions with them (Hinduja-OVL)," he said but did not give a timeline for making a decision.
Hinduja Group had in August 2007 struck a deal with NICO, a wholly-owned subsidiary of National Iranian Oil Co, for a 45 per cent stake in Azadegan oilfield and 60 per cent in the development of Phase-12 of the giant South Pars gasfield.
The NICO board has now formally approved of the proposed collaboration for development of the two fields.
Iran, which holds second largest oil and gas reserves after Saudi Arabia, is the most important country within the second circle of India's security parameter.
The estimated cost for developing the Phase-12 of the giant South Pars gas field has gone up to USD 5.2 billion from USD 3.5 billion estimated earlier. Similarly, the same for Azadegan field has increased from USD 1.25 billion to USD 2.5-3 billion. Azadegan field will produce 150,000 barrels per day of oil in the first phase that would double subsequently, while South Pars Phase-12 can produce up to 12 million tons of gas that will be converted into LNG at a USD two billion facility.
Hinduja-OVL combine has sought supply commitment for the entire oil produced from Azadegan field and 7.5 million tons of LNG from South Pars Phase-12.
Iran does not give companies a stake in its oilfields, but signs buyback agreements where companies hand over operations of fields to NIOC after development and then receive fixed returns on their investment.
Switzerland-registered Naftiran Intertrade Co (NICO), a unit of NIOC, has been offered a stake in the 15 million tons a year refinery, one million tons petrochemical and 7.5 million tons LNG receipt facility planned by Hinduja-ONGC at an investment of over USD 10 billion in India.
About the Hinduja Group
The Hinduja Group is a multi-billion dollar global investment and banking group with a diversified global portfolio of holdings across the manufacturing services and banking sectors. The Group, founded by Shri P.D. Hinduja in 1914, has activities across three core areas: Investment Banking, International Trading and Global Investments. As part of its Global investments, the Group owns businesses in Automotive, Information Technology, Media, Entertainment & Communications, Banking & Finance, Infrastructure Project Development, Chemicals & Agri business, Energy, Real Estate and Healthcare.
The Hinduja Group also supports charitable and philanthropic activities across the world through the Hinduja Foundation.
