ONGC Videsh Seeks Producing Assets In Politically Stable Countries

- ONGC Videsh Seeks Producing Assets In Politically Stable Countries

Tuesday, August 30, 2011
Dow Jones Newswires
NEW DELHI
by Rakesh Sharma

Oil & Natural Gas Corp. (500312.BY) is seeking producing assets in politically stable countries as it seeks to cut its geographical risks, the head of the Indian explorer's overseas investment unit said Tuesday.

"We have investments in many risky countries. We would be diversifying to more stable countries like North America," Joeman Thomas, managing director of ONGC Videsh Ltd., told reporters on the sidelines of a news conference.

The social and political upheaval in the Middle East and North Africa has drastically raised the risk profile of some prolific international basins that hold substantial hydrocarbon reserves, impacting investment plans of global oil and gas explorers, ONGC said in its annual report earlier this month.

OVL holds stakes in exploration blocks in places like Libya, Syria and Sudan, which have been hit by political unrest.

Thomas said the decision on re-adjusting the portfolio was taken about two years ago. He added that the company aims to acquire producing properties over the next two to three years as it has a mandate to source 20 million tons, or 400,000 barrels a day, of crude from overseas assets by 2020.

OVL expects its share of output from overseas assets at 8.75 million tons in the current financial year through March 2012, he said.

In March this year, India's top auditor had criticized OVL over its investments and joint ventures overseas saying that the explorer wasn't able to mitigate risks and leverage the benefits from the financial strength and expertise of the joint venture partners. The auditor said that OVL needed to improve its core competence in the evaluation of investment opportunities.

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ONGC Chairman: Plan To Bid Aggressively for Overseas Blocks

- ONGC Chairman: Plan To Bid Aggressively for Overseas Blocks

Thursday, August 25, 2011
Dow Jones Newswires
NEW DELHI
by Rakesh Sharma

Oil & Natural Gas Corp. (ONGC) plans to aggressively bid for oil and gas assets overseas in upcoming auctions as part of its strategy to more than double oil production abroad to 20 million tons a year by 2020, the chairman of India's flagship explorer said.

ONGC plans to work with other Indian state-run oil and gas companies through its overseas investment arm ONGC Videsh Ltd., or OVL, to bid for assets overseas, A.K. Hazarika told Dow Jones Newswires in an interview late Wednesday.

"Ours is an import-dependent country and we need energy," Hazarika said. "Although, all the companies can go out and bid, we shouldn't be competing against each other. So we will form joint ventures."

India's state-run companies have lagged behind those from bigger Asian rival China in acquiring energy assets overseas.

OVL's last big acquisition was Russia-focused Imperial Energy in January 2009, which it bought for $2.12 billion.

The federal government is now considering creating a sovereign fund focused on resource asset acquisition overseas to seek energy sources for the world's second-fastest growing major economy.

OVL has been shortlisted to bid in Iraq's forthcoming auction round, Hazarika said, adding his company will form a consortium for bidding.

Iraq is offering 12 exploration blocks in its fourth licensing round, which will take place in January.

He said OVL will also be interested in forthcoming auctions in Brazil and Oman.

Early next year, Brazil is expected to hold the 11th bid round for exploration and production blocks in onshore and offshore basins.

OVL has stakes in one producing block and half a dozen exploratory blocks in Brazil.

Oman is expected to offer about five oil and gas blocks in a new exploration licensing round.

"ONGC will look into the properties and take a call based on due diligence," Hazarika said.

He said OVL, which produced 9.43 million tons of oil and oil equivalent gas in the year ended March 31, has invested INR560 billion ($12 billion) so far in overseas assets.

"Money is not a constraint for us as OVL can easily borrow from the market," Hazarika said. He didn't give details about the company's overseas investment plans.

He said OVL also expects to resume exploratory activities in Libya and explore more investment opportunities once normalcy returns in the African country.

OVL declared force majeure and suspended operations in February in an offshore exploration block in Libya, citing political unrest.

Oil companies active in Libya before the civil war began gearing up for the challenge of resuming operations in the country Monday as rebel forces moved closer to taking over Tripoli.

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SeaBird Catches Seismic Gig for ONGC Field

- SeaBird Catches Seismic Gig for ONGC Field

Tuesday, August 23, 2011
SeaBird Exploration plc

SeaBird announced through its wholly owned subsidiary SeaBird Exploration FZ LLC the receipt of a Notification of Award (NOA) from Oil and Natural Gas Corporation Ltd of India (ONGC) for a 4C-3D Seismic API Pilot Project in Mumbai High Field. This is an official notification that SBX has been awarded Tender No Y16KC10017 and consequently the Hugin Explorer and Munin Explorer will mobilize from the Norwegian North Sea immediately following the conclusion of the current ExxonMobil contract expected to be around 10th September 2011.

This is a most prestigious contract award for SBX - as well as being the eighth contract award since operations started - and a highly important survey for ONGC as the data to be acquired is necessary for the planned optimal placement of two development wells from the upcoming platforms within the survey area by June 2012. ONGC has requested start up as soon as possible and SBX estimation for commencement on survey site is around mid October 2011.

The total number of node stations deployed will be in excess of 2,300 at 200 meter spacing, and data acquisition will be carried out in two swaths by rolling phases of approximately 760 nodes each. The technical expertise and track record of SBX in previous surveys has been an important element of the choice of contractor by ONGC, and furthermore this contract is another important step forward in the developing OBN market sector as it covers processing and interpretation for both pressure and converted (shear) wave data.

Value of the contract is USD 40 million and duration is estimated to be about 110 days including mobilization from North Sea.

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ONGC In Talks to Sell Indian Ocean Deepwater Stakes - FT

- ONGC In Talks to Sell Indian Ocean Deepwater Stakes - FT

Monday, August 08, 2011
Dow Jones Newswires

India's Oil & Natural Gas Corp. (ONGC) is talking to Shell, BG Group and Eni to sell stakes in its Indian Ocean deepwater developments, the Financial Times reported Sunday, citing ONGC's chairman AK Hazarika.

ONGC is already co-operating with Shell, BG and Eni in a number of other blocks, and talks had been under way for some time. ONGC seeks a partner on the technical front to expand the development of its 85 deepwater blocks in the Indian Ocean, Hazarika said in the report available on the FT website, without giving a deadline for the deal.

The company was willing to give away up to 30% of its assets in exchange for technical expertise, Hazarika said, according to the report.

Shell and BG declined comment, while Eni didn't respond, the FT said.


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India's ONGC to Invest $7.7B in Gas Field

- India's ONGC to Invest $7.7B in Gas Field

Tuesday, June 21, 2011
Deutsche Presse-Agentur (dpa)

India's state-run Oil and Natural Gas Corporation plans to invest 7.7 billion dollars to develop one of the country's largest gas fields off the eastern coast, officials said Tuesday.

ONGC was planning to drill eight additional wells in the block in the Krishna-Godavari (KG) basin and had sought permission from the Directorate General of Hydrocarbons, a company spokesperson said.

"A total life-cycle cost as per the proposal for Declaration of Commerciality (DoC) is of the order of 7.7 billion dollars," the official said.

The gas field could produce upto 30 million cubic meters a day in five years, according to the report in the Economic Times daily.

The oil major is also looking for tie-ups with international partners to maximize the output from the deep-sea field.

The KG basin is India's most prolific gas basin and home to some of India's biggest natural gas discoveries in recent years.

India depends on imports for about 70 percent of its oil and gas needs.

Copyright 2011 dpa Deutsche Presse-Agentur GmbH

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ONGC, GAIL Keen to Buy ExxonMobil Stake in Kazakh Oil Field

- ONGC, GAIL Keen to Buy ExxonMobil Stake in Kazakh Oil Field

Wednesday, June 08, 2011
Dow Jones Newswires
by Rakesh Sharma

Oil & Natural Gas Corp. (ONGC) and GAIL are working on a plan to buy at least a part of ExxonMobil's stake in Kazakhstan's Kashagan oil field, in yet another push by the South Asian country to secure energy assets for its expanding economy.

"We are interested. We are working on it," GAIL Chairman B.C. Tripathi told Dow Jones Newswires. He didn't say how much of Exxon's stake in Kashagan were the two state-run companies looking to acquire.

"The discussions have been going on but no decision has been made yet," said a senior ONGC executive, who didn't wish to be named.

ONGC is India's flagship oil explorer while GAIL is the country's largest gas distributor by market share.

Earlier Wednesday, the Hindustan Times newspaper reported that ONGC Videsh Ltd., ONGC's overseas investment arm, and GAIL are jointly planning to buy an 8.4% stake in the Kashagan oil field from Exxon Mobil for about $5 billion.

The consortium has submitted a non-binding bid to Exxon to buy about half of its 16.8% stake in the oil field, the report said, citing documents related to the deal.

Exxon Mobil spokesman Alan Jeffers told Dow Jones Newswires the company doesn't comment "on rumors, speculation or media reports."

"Kazakhstan is an important element of the Exxon Mobil global portfolio and we have a long-term commitment to the country," Jeffers said.

India, which meets nearly four-fifths of its crude oil requirement through imports, has been eying energy assets in Kazakhstan. The Central Asian nation is expected to become one of the world's top 10 oil producers by 2025 and one of the top three contributors to production growth outside the Organization of Petroleum Exporting Countries.

In April, Indian Prime Minister Manmohan Singh and Kazakhstan President Nursultan Nazarbayev underlined the importance of energy cooperation between the two countries.

India has lagged its rival China in the race for energy assets in Kazakhstan, which is home to some of China's largest investments.

China National Petroleum Corp. and Kazakhstan's national oil and gas company, KazMunaiGas, signed a new energy cooperation agreement in February. CNPC has said that its oil and gas production in Kazakhstan reached a record 30 million metric tons of oil equivalent in 2010 and that it plans to double the transmission capacity of the crude oil pipeline linking the two countries to 20 million metric tons a year, or 401,600 barrels a day, by 2013.

"The decision making in Indian state-run companies on acquisitions is very slow as they have to seek too many approvals and there are layers of sanctions required," said Jagannadham Thunuguntla, equity head of brokerage SMC Capitals Ltd. "The multi-billion-dollar deals also need parliament approval, which further slows the speed. India needs to move fast to seal such deals."

Kazakhstan expects its Kashagan oil field, which lies in the northern part of the Caspian Sea, to begin production by the end of 2012. Production is expected to reach 1.0 million tons in the second phase of development and 1.5 million tons in the third phase.

KazMunaiGas, Royal Dutch Shell PLC, ExxonMobil, Total SA and ENI SpA each own 16.81% in Kashagan while ConocoPhillips and Japan's Inpex Corp. hold 8.4% and 7.56%, respectively.

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ONGC, GAIL, Petronet May Invest INR155B in Russia Gas Project - Report

- ONGC, GAIL, Petronet May Invest INR155B in Russia Gas Project - Report

Monday, May 30, 2011
Dow Jones Newswires

Oil & Natural Gas Corp. (ONGC), GAIL and Petronet LNG may form a consortium to invest INR155 billion for a 15% stake in a liquefied natural gas project in Russia, the Hindustan Times reported Friday.

The consortium may buy a stake in the $30 billion LNG project of Russia's biggest independent natural gas producer, OAO Novatek (NVTK.RS), in the Yamal peninsula, the report said, citing an unidentified executive at one of the Indian companies.

A non-binding indicative bid is underway and the stake would be split between ONGC Videsh Ltd., GAIL and Petronet as 7.5%, 5% and 2.5%, respectively, the report said.

ONGC Videsh is the overseas investment arm of state-run explorer Oil & Natural Gas.

"We are not aware of any such bid," Petronet Chief Executive A.K. Balyan told Dow Jones Newswires. ONGC Chairman A.K. Hazarika declined to comment while GAIL's chairman wasn't immediately reachable for comment.

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ONGC, Uzbekneftegaz Join Forces in Uzbek Exploration

- ONGC, Uzbekneftegaz Join Forces in Uzbek Exploration

Wednesday, May 18, 2011
ONGC Videsh Ltd.

ONGC Videsh (OVL) entered in to a Memorandum of Understanding (MOU) with Uzbekneftegaz (UNG), the National Oil Company of Uzbekistan for Joint Cooperation in the Upstream E&P sector of Uzbekistan as well as third countries. The MOU was signed on May 17, 2011 by Mr. Satpal Garg, Director (Finance) of OVL and Mr. Shokir Faizullayev, Chairman, Uzbekneftegaz in the presence of H.E. Mr. Rustam Azimov, First Deputy Prime Minister, Minister of Finance of Uzbekistan.

Uzbekistan has long been an important gas producer and ranks 13th in terms of global gas supply. The MOU provides for the formation of Joint Working Group consisting of experts from both the companies for identifying specific oil & gas fields in Uzbekistan and the areas in third countries for E&P activities through Joint Cooperation.

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ONGC, Uzbekneftegaz Enter MOU

- ONGC, Uzbekneftegaz Enter MOU

Wednesday, May 18, 2011
ONGC Videsh Ltd.

ONGC Videsh (OVL) entered in to a Memorandum of Understanding (MOU) with Uzbekneftegaz (UNG), the National Oil Company of Uzbekistan for Joint Cooperation in the Upstream E&P sector of Uzbekistan as well as third countries. The MOU was signed on May 17, 2011 by Mr. Satpal Garg, Director (Finance) of OVL and Mr. Shokir Faizullayev, Chairman, Uzbekneftegaz in the presence of H.E. Mr. Rustam Azimov, First Deputy Prime Minister, Minister of Finance of Uzbekistan.

Uzbekistan has long been an important gas producer and ranks 13th in terms of global gas supply. The MOU provides for the formation of Joint Working Group consisting of experts from both the companies for identifying specific oil & gas fields in Uzbekistan and the areas in third countries for E&P activities through Joint Cooperation.

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ONGC Makes New O&G Discoveries in Gujarat

ONGC Makes New O&G Discoveries in Gujarat

Friday, April 29, 201
Asia Pulse Pte. Ltd.

Indian state-owned Oil and Natural Gas Co. (ONGC) said it has made two oil and gas discoveries in Gujarat.

ONGC struck oil and gas in a well drilled block CB-ONN-2004 2 in Gujarat, the company said in a statement.

The state-owned firm has 50 percent interest in the block that it had won along with Gujarat State Petroleum (40 percent) and Sunterra (10 percent) in the seventh round of bidding under New Exploration Licensing Policy (NELP).

Exploratory well Vadtal-3 produced oil at a rate of 22.5 cubic meter per day and gas at a rate of 3758 cubic meter per day on testing, it said, "The oil produced is of very good quality with a gravity of 41.10 API."

This is the second discovery in block CB-ONN-2001/1.

ONGC said it made an oil discovery in a nomination block Linch Extn-1 in the western offshore.

"Development well North Kadi-461 in Linch Extn-I PML, Western Onshore Basin, was drilled to a depth of 1600 meters," it said adding oil flowed at a rate of 17 cubic meters per day during testing.

The oil is heavy oil with 25.390 API gravity.

ONGC said it produced 27.272 million tonnes of crude oil in 2010-11 fiscal, marginally higher than the target of 27 million tonnes. Gas production at 25.322 billion cubic meters was also higher than 25 bcm target.

It sold 20.297 bcm of gas and produced 3.2 million tonnes of value added products in the fiscal year.

The firm's overseas arm, ONGC Videsh Ltd produced 9.433 million tonnes of oil and oil equivalent gas, surpassing the earlier peak production of 8.87 million tons of oil and oil equivalent gas in 2009-10.

Commenting on the performance, ONGC chairman and managing director A K Hazarika said, "Considering the global average rate of production decline from matured oil fields, this performance of ONGC is commendable."

"Our performance in reserve accretion is once again laudable. However, without drawing any complacence, we are focusing on bringing all new discoveries to production at the earliest possible opportunities," he said.

ONGC said it made a total of 24 discoveries during 2010-11 financial year.

During 2010-11, ONGC said it added 236.92 million tonne oil and oil equivalent (Mtoe) gas in-place reserves. Of this "83.56 million tonnes of oil equivalent as the Ultimate Reserve surpassed the record breaking performance of previous fiscal (82.98 Mtoe) and resulting a RRR (Reserve Replacement Ratio) of 1.76."

ONGC to Buy 25% Stake in Kazakh Exploration Block

ONGC to Buy 25% Stake in Kazakh Exploration Block

Wednesday, April 13, 2011
Dow Jones Newswires
by Rakesh Sharma

Oil & Natural Gas Corp. will sign an agreement Saturday to purchase a 25% stake in the Satpayev exploration block in Kazakhstan, the chairman of India's biggest explorer said Wednesday.

"The government [of India] has approved a total investment plan of $400 million. This includes a signature bonus of $13 million and $80 million as a fee for taking the stake in the block," A. K. Hazarika told Dow Jones Newswires.

"The rest will be spent on exploration activities."

The deal will mark another success by ONGC in its attempts to buy oil and gas assets overseas to secure energy supplies for the world's fastest-growing major economy after China. The state-run company, which has been witnessing a decline in production at its aging fields in India, has in the past missed out on several overseas oil and gas asset acquisitions, especially to cash-rich Chinese companies in western Africa.

Kazakhstan's Satpayev exploration block is located in a hydrocarbon-rich region of the North Caspian Sea, off the country's south-western coast.

KazMunaiGas, Kazakhstan's national oil company, will hold the remaining 75% stake in the block.

The initial agreement for the stake sale was signed in 2009, but the governments haven't so far disclosed the valuation for the stake transfer.

ONGC had originally sought the 25% stake in association with Lakshmi Niwas Mittal's Mittal Investments Sarl, but the billionaire, who owns a steel mill in the central Asian nation, pulled out of the venture in November 2009, leaving ONGC to pursue the deal on its own.

ONGC will likely purchase the stake in the Satpayev block via its overseas investment unit, ONGC Videsh Ltd.

Hazarika said the agreement will be signed during Indian Prime Minister Manmohan Singh's visit to Kazakhstan for bilateral meetings. Singh will visit Kazakhstan Friday and Saturday.

The Indian government is pushing state-run explorers to expedite acquisitions of overseas exploration and producing assets as a possible hedge against fluctuations in global crude oil prices and save on precious foreign exchange. The South Asian country imports four-fifths of its crude oil requirements.

Earlier Wednesday, the Hindustan Times reported that a peak output of 287,000 barrels per day is envisaged from the 256 million tons of reserves in the Satpayev field.

Hazarika declined give details on the reserves. "That has to be seen," he said.