ONGC Videsh in talks to buy stake in Russia’s Arctic LNG 2 project
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ONGC Videsh in talks to buy stake in Russia’s Arctic LNG 2 project

07 Sep 2021 (Last Updated September 7th, 2021 16:14)

The Indian firms seek to purchase a 9.9% stake in the $21.3bn Arctic LNG 2 project as well as a stake in the Vostok Oil project.

ONGC Videsh in talks to buy stake in Russia’s Arctic LNG 2 project
OVL-led consortium intends to relinquish the Block-32 offshore Israel. Credit: LoggaWiggler / Pixabay.

India’s energy companies ONGC Videsh (OVL) and Petronet LNG are reportedly in talks to acquire stake in Arctic LNG 2, which is under construction on the Gydan peninsula, Russia.

The firms are planning to purchase a stake of 9.9% from Russia’s LNG producer Novatek PJSC, reported the Press Trust of India (PTI).

Being developed with an investment of $21.3bn, the Arctic LNG 2 project includes the construction of three LNG trains that will have a combined LNG capacity of 19.8 million tonnes per annum (mtpa) and about 1.6mtpa of stable gas condensate.

The project, which is 60% owned by Novatek, is planned to be commissioned in 2023.

Indian Minister of Petroleum and Natural Gas Hardeep Singh Puri was cited by the news agency as saying that ONGC Videsh, the overseas unit of India’s ONGC, is also seeking to purchase a minority stake in the Vostok Oil project in Russia.

As per the estimates, the Vostok Oil project holds combined resources of more than six billion tonnes or around 44 billion barrels of premium crude.

In a separate announcement, OVL-led consortium has reportedly relinquished Block-32 offshore Israel, citing very poor hydrocarbon prospectivity, reported PTI citing two officials with the partner firms.

The consortium, which includes Oil India, Indian Oil Corp (IOC), and Bharat Petro Resources (BRPL), signed the Petroleum License for the block in March 2018. The license was valid up to 26 March 2021.

Under the bid conditions, the consortium carried out hydrocarbon prospectively assessment based on the available 2D and 3D seismic data.

An official was cited by PTI as saying that the Indian partners, subsequently, submitted a report along with the block’s prospectivity analysis.

The official noted: “Due to very poor hydrocarbon prospectivity, the consortium decided to relinquish the block and the notice of relinquishment was issued to the Petroleum Commissioner, Israel. The Petroleum Commissioner, Israel has approved the relinquishment.”