Taking the bilateral co-operation in the energy sector to new heights, India and Russia have inked a series of deals to work jointly through acquisition and sale of stakes in crucial oil assets.
Russia’s largest oil producer, Rosneft– while agreeing to offer substantial stakes to state-owned Indian PSU oil companies in two Siberian oil and gas fields, also announced its intention to purchase a 49% stake in Essar Oil, the company that owns the country’s second largest oil refinery at Vadinar in Gujarat.
Minister of State for Oil and gas, Dharmendra Pradhan held bilateral meeting with the visiting President, Chairman of the Management Board, Rosneft, Russia, Igor Ivanovich Sechin and witnessed the signing of mega deals between India’s top state-owned oil and gas companies (ONGC, IndianOil, Bharat Petroleum) and Russia’s largest oil producing company-Rosneft.
Sechin is visiting India in connection with acquiring of share in Vankorneft and Taas-Yuryakh by Indian Public Sector Enterprises in Oil and Gas as also for inking another mega deal with India’s private sector major—Essar group for picking up a 49% stake in Essar Oil.
— Essar (@Essar) March 16, 2016
Vankorneft is a wholly owned subsidiary of Rosneft which operates Vankor Field in Russia. The Consortium comprises of Oil India Ltd, Indian Oil Corporation and Bharat Petro Resources Ltd.
The four Agreements / Memorandum of Understanding signed in the presence of Pradhan included the Share Purchase Agreement (SPA) between the consortium of Indian companies (Oil India Ltd, Indian Oil Corporation and Bharat Petro Resources Ltd) and Rosneft of Russia on acquiring 29.9 % share in Taas-Yuryakh by the consortium. Media Reports had put the value of this deal at $1.28 million.
The Tass-Yuryakh field is presently producing 20,000 barrels of oil per day with peak production of 100,000 bpd likely by 2021, an IOC statement said.
Besides, a Heads of Agreements was signed between the consortium of Indian companies (Oil India Ltd, Indian Oil Corporation and Bharat Petro Resources Ltd) and Rosneft of Russia on acquiring of 23.9% share by the consortium in Vankorneft. The deal is expected to be over $2 billion.
Another Memorandum of Understanding was inked between ONGC Videsh Ltd. (OVL) and Rosneft of Russia regarding acquiring of 11% share in Vankorneft in addition to earlier 15% share by OVL. The likely payment involved here is close to $1.26 billion.
Besides, another Memorandum of Understanding was signed between consortium of Indian companies (Oil India Ltd, Indian Oil Corporation and Bharat Petro Resources Ltd) and Rosneft of Russia for acquisition in Vankor cluster.
Pradhan in his meeting with Sechin described Russia as 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 expressed their commitment to work together to further strengthen the India-Russia relations in the Hydrocarbon sector.
K D Tripathi, Secretary (Petroleum), H.E. Alexander Kadakin, Ambassador of Russia to India, Senior Officials from Ministry of Petroleum and Natural Gas, CMD/CEOs of Indian Public Sector oil and gas Enterprises and Officials from Rosneft were present during the signing.
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