In its fourth biggest acquisition ever, state-owned ONGC will buy a 15 per cent stake in Russian top oil producer Rosneft's Vankor oil field in Siberia for close to USD 1.3 billion.
ONGC Videsh Ltd, the overseas investment arm of Oil and Natural Gas Corp, signed an agreement to buy 15 per cent interest in Vankorneft, the developer of the Vankor oil and gas condensate field -- Russia's second biggest -- 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.
OVL in a statement said it "has 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 North Vankor licence."
Rosneft, Russia's national oil company, holds 100 per cent stake in Vankorneft. The acquisition is subject to relevant board, government and regulatory approvals and is expected to be completed by 2016-mid, it said.
While both OVL and Rosneft did not give value of the deal, a source privy to the transaction said OVL will pay around USD 1.3 billion. "The consideration is somewhere between USD 1.25 billion and USD 1.3 billion," the source said.
This will be the fourth biggest acquisition by OVL. It had in 2013 paid USD 4.125 billion for a 16 per cent stake in Mozambique's offshore Rovuma Area 1, which holds as much as 75 Trillion cubic feet of gas reserves.
In 2009, it had bought Russia-focused Imperial Energy for USD 2.1 billion. Prior to that, it had in 2001 paid USD 1.7 billion for a 20 per cent interest in the Sakhalin-1 oil and gas field off Russia's far eastern coast.
"Vankor is Rosneft's (and Russia's) second largest field by production and accounts for 4 per cent of Russian production. The daily production from the field is around 442,000 barrels per day of crude oil on an average with OVL's share of daily oil production at about 66,000," OVL said.
The agreement to buy stake in Vankor was signed by the Chairman of Rosneft Management Board Igor Sechin and OVL Managing Director Narendra Verma in Vladivostok, in Russia's Far East.
