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Petroleum industry

India Strengthens Energy Ties with Russia through New Oil Agreements

Strategic Insights

— 2 min read

India's ONGC Videsh Ltd (OVL) has initiated talks to increase its stake in Russia's second-largest oilfield, Vankor, while Indian Oil Corp and Oil India are negotiating for a stake in the Taas-Yuriakh Neftegazodobycha oilfield in East Siberia. These agreements are part of a larger effort to deepen energy ties between India and Russia. OVL, the overseas arm of Oil and Natural Gas Corp, is in discussions with Rosneft, Russia's top oil firm, to potentially raise its stake in Vankor. Meanwhile, Indian Oil Corp and Oil India have signed a memorandum of understanding with Rosneft to explore cooperation in the Taas-Yuriakh Neftegazodobycha LLC asset.

Key Takeaways:

  • OVL is in talks to increase its stake in Russia's second-largest oilfield, Vankor, from 15% to an unspecified higher percentage.
  • Indian Oil Corp and Oil India are negotiating for a 29% stake in the Taas-Yuriakh Neftegazodobycha oilfield in East Siberia.
  • The agreements were signed during Prime Minister Narendra Modi's visit to Russia, and involve cooperation between OVL and Rosneft.
  • The Vankor oilfield has recoverable reserves of 2.5 billion barrels and is expected to produce 3.3 million tonnes of oil per annum.
  • The Taas-Yuriakh Neftegazodobycha LLC asset is expected to produce more than 5 million tonnes of oil annually from 2017.
  • Rosneft has sold a 20% share in Taas-Yuriakh to BP for $750 million in October 2015.
  • The acquisition of Vankor by OVL is expected to be completed in 3-4 months after regulatory approvals are obtained.
  • OVL and Rosneft have signed an Agreement of Confirmation of the successful completion of the first stage of the Indian firm's acquisition of 15% stake in Vankor.

Statistics:

  • $1.268 billion: the amount OVL paid for a 15% stake in Vankor in September 2015.
  • $750 million: the amount Rosneft sold a 20% share in Taas-Yuriakh to BP in October 2015.
  • 2.5 billion barrels: the recoverable reserves of the Vankor oilfield.
  • 3.3 million tonnes: the expected annual oil production from the Vankor field.
  • 5 million tonnes: the expected annual oil production from the Taas-Yuriakh Neftegazodobycha LLC asset from 2017.
  • 3-4 months: the expected time frame for the completion of the acquisition of Vankor by OVL.

Sources:

  • "ONGC Videsh Ltd (OVL)is in talks to raise its stake in Russia's second biggest oilfield of Vankor" (Source: 2015 Global Data Point)
  • "Indian Oil Corp-Oil India are in negotiations for a stake in Taas-Yuriakh Neftegazodobycha oilfield in East Siberia" (Source: 2015 Global Data Point)
  • "OVL Managing Director Narendra K Verma and Rosneft Chairman Igor Sechin signed a memorandum of understanding in presence of Modi and Russian President Vladimir Putin" (Source: 2015 Global Data Point)
  • "Indian Oil Corp and Oil India signed a separate MoU with Rosneft where they agreed to examine the possibility of cooperation in respect of the Taas-Yuriakh Neftegazodobycha LLC asset" (Source: 2015 Global Data Point)

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