Coal News We love to talk!

OCT 14 2016

Indian PSUs deal with Russias Rosneft for Vankor cluster unlikely at BRICS summit

  • Economic Times, ET Bureau / Hyderabad
  • Created: Fri 14th OCT 2016

India’s public-sector hydrocarbon companies, namely ONGC Videsh (OVL), Indian Oil (IOC), Oil India (OIL) and Bharat PetroResources (BPRL), are unlikely to sign a heads of agreement to acquire up to 49.9% stake in Rosneft’s Vankor cluster asset in east Siberia during the BRICS summit in Goa this week.

A top official of one of the Indian firms told FE that signing of the deal would be delayed as they are yet to analyse two out of three fields in the Vankor cluster — Suzunskoye, Tagulskoye and Lodochnoye. At the same time, Oil India may opt out of the consortium. Earlier, the parties were targeting to sign a heads of agreement at the BRICS summit, where Russian President Vladimir Putin would also join. New Delhi’s interest in increasing economic cooperation with Kremlin was reflected in several rounds of talks between Prime Minister Narendra Modi and Putin.

Indian public-sector companies had struck deals to buy equity stakes worth about $5.3 billion with Rosneft since September 2015. OVL has picked up 26% stake in Vankor field in two transactions, while a consortium of OIL-IOC-BRPL acquired another 23.9% in the same asset, taking the total stake of Indian firms in the prolific asset to to 49.9%. In a separate transaction, the IOC-OIL-BPRL combine picked up 29.9% in Taas-Yuryakh project.

The official said the imminent deal for the Vankor cluster asset would also for a 49.9% stake as in the case of the Vankor asset. But if Oil India opts out, the stakes would have to be reworked between the firms. The reserves and value of the deal are not known. Industry watchers say that a near-50% deal would be worth more than a couple of billion dollars.

Wood Mackenzie, a global energy research and consultancy group, suggested a fair value of $5.9 billion for a 49.9% stake in Vankor and $1.4 billion for a 29% stake in Taas-Yuryakh. This means the deals concluded by India firms were at a 30% discount to Wood Mackenzie valuations.

The Vankor cluster, also known as satellite field, has “huge-potential”, said another official, adding that the Vankor cluster comprises both producing and under-development fields.

Tags

Delhi TOTAL Goa BSES Rajdhani Power Ltd Goa Oil ONGC Hydrocarbon Energy ONGC Videsh India ongc

Related News

  • Oil sector feels heat as fuel losses soar  Read more
  • Investment decision on Hazira terminal expansion soon: Royal Dutch Shell  Read more
  • Thursday meet to take up stressed power projects resolution  Read more
  • India, other countries signed International Solar Alliance framework agreement  Read more
  • Exxon Mobil, partners set $4.4 billion for mega oil project in Guyana  Read more
  • India Inc wants policy support to bet on wind, solar energy  Read more
  • Oil Stocks Biggest Losers With Valuations Lowest Since 2009  Read more
  • India plans to add 1,305 Mw hydropower capacity in current fiscal  Read more
  • Antony to head EGoM on natural gas pricing  Read more
  • Climate change has resulted in substantial reduction of coral cover: WWF  Read more