India clinches stake in Russian oilfields
In a deal worth $1.3 billion, Indian consortium buys 29.9% stake in Taas-Yuryakh oilfield in East Siberia
Indian firms on Wednesday clinched a slew of deals worth around $4 billion with long-time strategic partner Russia for purchasing stakes in two key East Siberian oilfields operated by Rosneft, the world's largest publicly-traded oil company. The move is expected to bolster India's energy security amid subdued global oil prices.
As part of the deal, a consortium of three public sector undertakings (PSUs) - Oil India (OIL), Indian Oil Corp (IOC) and Bharat Petroleum Resources (BPRL) - will pay $1.28 billion (Rs 8,618 crore) for a 29.9 per cent stake in Rosneft-operated Taas-Yuryakh oilfield based on a share purchase agreement (SPA) signed on Wednesday. The deal values the oilfield at $4.2 billion (Rs 28,280 crore) and is expected to be closed by September.
India clinches stake in Russian oilfields "The deal parameters will be reported to the market later. These transactions provide Indian companies access to production on Russian territory, and Rosneft is gaining access to the opportunity to operate in the Indian market. Therefore, we are establishing a reliable energy bridge between our countries," Rosneft Chief Executive Igor Sechin told reporters on the sidelines of the signing ceremony, following a meeting with Petroleum Minister Dharmendra Pradhan.
The Taas-Yuryakh field is rich in gas with presence of layers of oil. Its current crude oil production hovers around 20,000 barrels of oil per day (bopd). The management is working on a target to raise production to 100,000 bopd in around two years. The field houses 137 million tonne of liquid hydrocarbon and 181 billion cubic metre (bcm) of gas. "As a result of this deal, we will get the rights over 30 per cent of the current production. The deal also stipulates around $180 million capital expenditure by the consortium in the oilfield," said a senior executive close to the development.
Article Source: http://www.business-standard.com/article/companies/india-clinches-stake-in-russian-oilfields-116031700073_1.html
Publication Date: 17 March 2016