Indian Oil Corporation Limited (IndianOil), India’s flagship national oil company, Oil India Limited (OIL) and Bharat PetroResources Limited (BPRL), acting jointly as the Indian Consortium, signed definitive agreements to acquire 29.9% stake in Taas-Yuryakh (TYNGD), a subsidiary of Russia’s largest national oil producing company Rosneft.
The acquisition is subject to relevant Board, Government and regulatory approvals and is expected to close by September 2016.
Rosneft Oil Company holds 80% shares while BP PLC (UK) holds 20% shares in TYNGD through their respective subsidiaries.
TYNGD is currently producing 20,000 bopd with expected peak production of 100,000 bopd by 2021.
In addition to the above, a Heads of Agreement (HoA) was signed for evaluation of acquisition of 23.9% in the CJSC Vankorneft by the consortium of IOCL, OIL and BPRL with Rosneft Oil Company.
CJSC Vankorneft is a company organised under the law of the Russian Federation, which is the owner of Vankor Field and North Vankor license. Vankor is Russia’s second largest field by production and accounts for 4% of Russian production and currently producing oil at a peak level of approximately 440,000 bopd.
Additionally, an MoU was signed between Rosneft and the consortium of IOCL, OIL & BPRL for joint evaluation of certain other assets of Rosneft in Russia.
The definitive agreement for TYNGD and HoA for Vankorneft and the MoU for joint evaluation of certain other assets were signed on 16th March 2016 in the presence of Dharmendra Pradhan, Minister of State for Petroleum & Natural Gas, between Igor Sechin, Chairman of the Management Board, Rosneft and B. Ashok, Chairman, Indian Oil Corporation Limited, U.P. Singh Chairman & Managing Director, Oil India Limited and D Rajkumar, Managing Director, Bharat PetroResources Limited.
Rothschild is the exclusive financial adviser to the Indian Consortium, which is also being advised by CGG as Technical Adviser, Latham & Watkins as Legal Adviser and EY as accounting and tax adviser.
Pradhan also had a bilateral meeting with Igor Sechin and described Russia as a longstanding and time-tested partner of India. He expressed happiness that India and Russia have high levels of understanding and cooperation in almost all areas of the bilateral relationship.
Both sides expressed their commitment to work together to further strengthen the India-Russia relations in the hydrocarbon sector.
Held delegation level talks CMD, Rosneft: Indian PSUs (OVL, IOC,BPCL, OIL) will invest in Russian oil & gas assets pic.twitter.com/IivpnysQo1
— Dharmendra Pradhan (@dpradhanbjp) March 16, 2016
About Indian Oil Corporation Ltd–IndianOil is India’s largest commercial enterprise, with a sales turnover of Rs. 4,50,756 crore (US$ 73.7 billion) and is ranked 119th among the world’s largest corporates (and first among Indian enterprises) in the prestigious Fortune ‘Global 500’ listing for the year 2015.
IOCL has been meeting India’s energy demands for over half a century. Its business interests straddle the entire hydrocarbon value-chain – from refining, pipeline transportation and marketing of petroleum products to exploration & production of crude oil & gas, marketing of natural gas and petrochemicals, besides forays into alternative energy and globalisation of downstream operations.
As part of its E&P portfolio, IndianOil has participating interest in eight domestic and seven overseas blocks. The seven overseas blocks are located in Libya, Gabon, Nigeria, Yemen, Venezuela, Canada and USA.
IndianOil accounts for nearly half of India’s petroleum products market share, 35% national refining capacity (together with its subsidiary Chennai Petroleum Corporation Ltd., or CPCL), and 71% downstream sector pipelines through capacity. The IndianOil Group owns and operates 11 of India’s 23 refineries with a combined refining capacity of 80.7 MMTPA (million metric tonnes per annum).
The Corporation’s cross-country pipelines network, for transportation of crude oil to refineries and finished products to high-demand centres, spans over 11,220 km.
IndianOil’s network of over 43,000 customer touch-points reaches petroleum products to every nook and corner of the country. These include over 25,000 fuel stations, including 6,200 Kisan Seva Kendra outlets (KSKs) in the rural markets. They are backed for supplies by 136 bulk storage terminals and depots, 100 aviation fuel stations and 91 LPG bottling plants.
Rosneft is the leader of Russia’s petroleum industry and the world’s largest publicly traded petroleum company. The Company’s activities include hydrocarbon exploration & production, upstream offshore projects, hydrocarbon refining, and crude oil, gas and product marketing in Russia and abroad.
The Company is included in the list of strategic companies and organisations of Russia. The main Company shareholder (69.50%) is OJSC ROSNEFTEGAZ, a 100% state-owned company. BP owns another 19.75%, and the remaining 10.75% of the shares are publicly traded.
Rosneft conducts its exploration & production activities in all key hydrocarbon provinces of Russia, including West Siberia, Southern and Central Russia, Timan-Pechora, East Siberia, Far East and the Russian continental shelf, including the Arctic region.
The Company is also embarking on and implementing a number of projects in Venezuela, Brazil, USA, Canada, UAE, Algeria, Norway, Kazakhstan, Vietnam and Abkhazia.
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