Indianoil, OIL in talks to buy stake in Russia's Vankor field
State-owned Indian Oil Corporation (IOC) and its partners are in talks to buy a 49 per cent stake in Russia's Vankor cluster oilfields to consolidate their presence in the energyrich Arctic region. IOC, Oil India Ltd and Bharat Petroresources Ltd (a unit of Bharat Petroleum Corporation Ltd or BPCL) are looking at buying a stake in the Suzunskoye, Tagulskoye and Lodochnoye fields — collectively known as Vankor Cluster. ONGC Videsh Ltd (OVL), the overseas arm of state-owned Oil and Natural Gas Corporation (ONGC), too is interested in the fields.
Rosneft, Russia's national oil company which owns the fields, wants to retain a majority stake and is keen to sell only up to 49 per cent stake. In case OVL is accommodated, the entire 49 per cent stake would have to be split between the Indian companies. OVL may possibly take 26 per cent in proportion to the stake it bought in the main Vankor oilfield.
The OIL-IOC-BPRL combine may take a 23.9 per cent stake in line with its holding in the main Vankor field. Vankorneft, a subsidiary of Rosneft, is developing the Vankor oil and gas condensate field, situated in the northern part of Eastern Siberia. In 2013, Vankorneft was chosen as an operator on development of new fields of the Vankor cluster Suzunskoye, Tagulskoye and Lodochnoye fields, located close to the Vankor field.
The reserves of the Suzunskoye field exceed 56 million tonnes of oil and condensate, and 35 billion cubic meters of gas. Last year, OVL first acquired a 15 per cent stake in Russia's second biggest oilfield of Vankor for $1.268 billion and then bought another 11 per cent for $930 million.
The 26 per cent stake would give ONGC Videsh Ltd 7.31 million tonnes of oil. The consortium of OIL-IOC-BPRL acquired 23.9 per cent stake in the field at a cost of $2.02 billion, giving them 6.56 million tonnes of oil.
Rosneft continues to hold the remaining 50.1 per cent shares of JSC Vankorneft. The field has recoverable reserves of 2.5 billion barrels. Besides, the OIL-IOC-BPRL consortium has taken another 29.9 per cent stake in a separate Taas-yuryakh oilfield in East Siberia for $1.12 billion.
The investments have taken the total outlay in Russia this year to $5.46 billion. These investments will give India 15.18 million tonnes of oil equivalent. The investment made compares to $28.48 billion investment by Indian companies overseas in the past 50 years, giving it about 10 million tonnes of oil equivalent.
While Vankor produces about 442,000 barrels of oil per day (4 per cent of Russian crude oil production), Taas currently produces about 21,000 barrels per day of oil, and apeak of 1,00,000 bpd is expected by 2021.