State-owned Oil and Natural Gas Corp’s overseas subsidiary, ONGC Videsh, is expected to finalise the acquisition of a 0.615% participating interest in the offshore Azeri Chirag Gunashli (ACG) oil field in Azerbaijan from Equinor within the next two months, according to company officials.
The company had earlier signed a definitive sale purchase agreement for increasing its participating interest in the ACG oil field in the country from Equinor. The agreement also included the acquisition of a 0.73% share of the Baku Tbilisi Ceyhan (BTC) pipeline company through its wholly-owned subsidiary ONGC BTC.
OVL expects that an increase in the stake in the ACG oil field will add to the company’s overseas crude oil production.
“We are increasing our stake in the ACG field in Azerbaijan by a smaller amount. The outgoing capex is not much but it will add to our production,” the company’s MD Rajarshi Gupta told FE. “It is under assessment and in another two months we should hear something,” he said.
The total investment for these acquisitions would be around $60 million and are in addition to the company’s existing 2.31% participating interest in the ACG field and 2.36% shareholding in the BTC pipeline.
“Because it is a producing field, we will not spend new capex. We are increasing our stake because Equinor is leaving so we had a right to do so. There are some other projects that we should hear about in the next two or three months,” Gupta said. The company spends a capex of around $500-700 million each year on the project.
ACG is one of the largest oil-producing fields in the world, located in the Caspian Sea about 95 km off the coast of Azerbaijan. The field has been operated by oil major BP since 1999. Developed in phases, Azeri Central East has been commissioned in early 2024.
Other partners in the field are the State Oil Company of Azerbaijan Republic (SOCAR), Inpex, ExxonMobil, Turkish national oil company Türkiye Petrolleri Anonim Ortaklığı (TPAO), MOL, and Japanese Itochu.
The field has a contract term till December 31, 2049. BTC pipeline carries oil from the ACG field and condensate from Shah Deniz across Azerbaijan, Georgia and Türkiye.
In April, BP and its partners commissioned output at Azerbaijan’s ACG oil field complex. BP had said that production from the $6 billion Azeri Central East project should reach 24,000 barrels per day by the end of 2024 as a second and third wells are brought on stream, in addition to the well just started up.
OVL is engaged in overseas exploration and production of crude oil and natural gas with 32 assets in 15 countries.
From: financialexpress
Financial News
