ONGC Videsh, Rosneft sign Vankor oil field deal

A deal to allow ONGC Videsh Limited to pick up 15% stake in Russia's second biggest oil field of Vankorneft and three other major pacts between Indian and Russian companies in the oil and gas sector have been struck during Prime Minister Narendra Modi's visit here which is expected to boost bilateral trade significantly.

India has been pressing for access to its companies in Russia's lucrative hydrocarbons sector and the pacts finalised are likely to facilitate their significant presence in oil and gas exploration in the Eurasian country.

As per the deal between ONGC Videsh Ltd (OVL) and Russian oil behemoth Rosneft, the former will pick up 15% stakes in Vankorneft oil fields in Siberia for $1.3 billion.

OVL and Rosneft also signed a Memorandum of Understanding for the cooperation for geologic survey, exploration and production of hydrocarbons onshore and on the continental shelf of the Russian Federation.

As per another pact, Oil India Ltd and Indian Oil Corporation signed a non-binding agreement with Rosneft setting time-frame for concluding due diligence and finalising a pact to pick up stakes in Taas-Yuryakh Neftegazodobycha oil field, which another major oil fields in Siberia.

India's Ambassador P S Raghavan said OVL signed another MoU with Rosneft expressing interest in a number of oil fields both in arctic shelf and in other parts of Syberia near Vankorneft and the intention for striking a deal.

He said Indian oil major Essar has concluded some details of a deal under which they will pick up 10 million tonnes of crude from Roseneft. Roseneft will pick up 49% stakes in India's second largest oil refinery in Vadinar in Gujarat.

As per the deal, the crude oil that goes from Russia will be refined at Vadinar.

Energy-starved India, the third largest oil importer after the US and China, has been pushing for greater involvement in major gas and oil exploration projects in Russia. Russia is one of the top oil producers globally and has huge reserves of natural gas.

The volume of current bilateral trade between the two countries is around$ 10 billion and both sides were of the view that deeper engagement in hydrocarbons sector will boost bilateral trade significantly and help them achieve the target of$ 30 billion in annual trade over the next 10 years.