 "Oil explorers push deep into Russia for energy ties")
ONGC Videsh Ltd (OVL) is in talks to raise its stake in Russia's second biggest oilfield of Vankor while Indian Oil Corp-Oil India are in negotiations for a stake in Taas-Yuriakh Neftegazodobycha oilfield in East Siberia as India looks to deepen energy ties with Russia.
The slew of agreements signed during Prime Minister Narendra Modi's visit to Russia yesterday included a document that provides for cooperation between OVL, the overseas arm of Oil and Natural Gas Corp (ONGC), and Russia's top oil firm Rosneft.
OVL was originally interested in taking 25 per cent stake in Vankor but Rosneft in September agreed to sell a 15 per cent interest for $1.268 billion.
Sources said besides formalising the September deal, OVL Managing Director Narendra K Verma and Rosneft Chairman Igor Sechin also signed a memorandum of understanding in presence of Modi and Russian President Vladimir Putin that provides for discussions on raising the stake in Vankor.
IOC and OIL signed a separate MoU with Rosneft where they "agreed to examine the possibility of cooperation in respect of the Taas-Yuriakh Neftegazodobycha LLC asset", IOC/OIL said in statements.
IOC-OIL are looking at 29 per cent stake in Taas-Yuriakh, which operates the Srednebotuobinsk field. It is expected to produce more than 5 million tonnes of oil annually from 2017.
Rosneft in October sold a 20 per cent share in Taas-Yuriakh to BP for USD 750 million.
OVL and Rosneft yesterday signed an Agreement of Confirmation of successful completion of the first stage of the Indian firm's acquisition of 15 per cent stake in Vankor.
OVL had on September 4 signed Share Purchase Agreement (SPA) and Shareholders Agreement (SHA) with Vankorneft, a unit of Rosneft that is the developer of the Vankor oil and gas condensate field in Turukhansky district of Krasnoyak territory in Russia.
The field, which has recoverable reserves of 2.5 billion barrels, will give OVL 3.3 million tonnes per annum of oil production.
As per the agreement, OVL had the right to walk out of the deal by October 31 but it chose to stay on and two subsequent agreements - oil marketing pact and oilfield services agreement - were signed, sources said.
This marked the completion of Phase-1 of the deal.
The entire acquisition will be completed in 3-4 months after Rosneft does a reorganisation of the Vankor field company and other regulatory approvals including from Russian anti-monopoly authority are obtained.
The MoU signed by Rosneft and OVL provides for cooperation for geologic survey, exploration and production of hydrocarbons onshore and on the continental shelf of the Russian Federation.
"Particularly, the companies will analyse the possibility of expanding their partnership aimed at the development of perspective Rosneft projects in East Siberia", OVL said in a statement.
