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ONGC Videsh, Rosneft to jointly explore hydrocarbons in Russia

LiveMint logoLiveMint 24-05-2014 Promit Mukherjee

Mumbai: ONGC Videsh Ltd (OVL), the international exploration arm of India’s biggest state-owned explorer ONGC Ltd (ONGC), and Russia’s biggest integrated oil and gas producer Rosneft have signed a deal to jointly scout for hydrocarbon opportunities in the offshore Arctic.

According to a statement by Rosneft on Saturday, the two companies have signed a memorandum of understanding (MoU) for “the companies’ cooperation in subsurface surveys, exploration and appraisal activities and hydrocarbons production in Russia’s offshore Arctic”.

The parties will jointly consider forming a consortium led by Rosneft and involving other partners, the statement said.

The MoU was signed between ONGC chairman and managing director D.K. Sarraf and Rosneft president and chairman of the management board Igor Sechin at the ongoing Saint-Petersburg International Economic Forum in Russia.

This will be OVL’s third venture in Russia since 2001 when the company made an entry into the challenging sedimentary basins of the country by acquiring a stake in the Sakhalin–1 field. Out of the three blocks in the field–the first started production in 2005 and the third is expected to start production in 2014, according to OVL’s website.

OVL’s second venture in Russia comprised its controversial purchase of a majority stake in Imperial Energy Corporation Plc., an oil exploration and production company. OVL bought it in 2009 for $2.1 billion and has its operations largely spread around the Tomsk region of Western Siberia, Russia.

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