Highlights of Director Exploration’s visit to Beijing, China to attend 37th MECL Board Meeting

Mr. Sudhir Sharma, Director Exploration – ONGC Videsh Limited, visited Beijing, China to attend 37th MECL Board Meeting as Director and Vice Chairman of MECL Board, held on 27th and 28th April 2017.

The board meeting was attended by  Mr. DuanZhibin (SINOPEC) as  Chairman, Mr. Gong Jiuhe (SINOPEC) and Mr. Amit Bharti (ONGC Videsh) as other Directors of MECL Board and by officers of MECL.

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From Left to Right: Mr. Navneet Singh (Assistant Secretary), Mr. J.P Waghray (CTO), Mr. Zhao Xuan (COO), Mr. Amit Bharti (Director), Mr. Duan Zhibin (Director-Chairman), Mr. Sudhir Sharma (Director- Vice Chairman), Mr. Gong Jiuhe (Director),  Mr. Carlos Alberto Benavides Bonilla (EVP CA&B), Mr. Zhang Hui (CFO),  Mr. Leonel Fernando Vargas Zapata (EVP Operations)

MECL has emerged as one of the key players of heavy crude oil in Colombia, and a pioneer of technology in the country. MECL is owned 50:50 by ONGC Amazon Alaknanda Limited (OAAL) and SINOPEC Overseas Oil and Gas Limited (SOOGL), respective Bermudian Subsidiaries of ONGC Videsh Limited and SINOPEC.

MECL owns 100% interest in Velasquez field (discovered in 1940s and is producing for nearly 60 years) and the Velasquez-Galan pipeline, which runs 189 km from the Velasquez property to Ecopetrol’s Barrancabermeja refinery. MECL operates in the fields within the Nare Association Contract with Ecopetrol, Colombia’s National Oil Company, where crude was found in the 1980’s. The Association contract covers the commercial fields Moriche, Girasol, Jazmin, Abarco, Nare Sur and Under River as well as non-commercial areas of Chicala.

The officers of MECL presented the agenda’s pertaining to Company’s performance, Annual Accounts of 2016, OPEX Budget of 2017, strategy for extension of one of the producing blocks, New Business development Strategy, strategic initiatives including Crude upgradation and Scope of Renewable Energy in Colombia as well as status of exploratory block operated by Mansarovar to the Board of Directors.

Mr Sharma appreciated the efforts of MECL team for conducting the meeting in efficient manner. He highlighted that the most burning issue is decline in production and MECL should make all efforts to arrest the decline and bring it back to the level it reached in 2014. He added that the ONGC Videsh technical team has studied the Velasquez field in detail and has also shared its technical recommendations with MECL team for arresting the production decline and further boosting the production level. He ensured all the help from ONGC Videsh for implementing those recommendations. He showed concern over the dismal performance of HSE KPI in 2016. He opined that the action plan to improve the HSE KPI by outsourcing the manpower also needs close supervision by MECL. The reasons for delay and cancellation of contract leading to low CAPEX and Physical execution must also be monitored very closely by MECL. He also supported the opinion of other Board member, Mr Amit Bharti of further optimizing and reducing the OPEX to add more value to the Shareholders. On NARE association renegotiation, he advised MECL to gauge the expectations of Ecopetrol and subsequently make strategy for negotiation on the basis Win-Win situation for both Ecopetrol and MECL. He assured ONGC Videsh help in diplomatic push/ intervention needed for success of Nare renegotiation. He appreciated the Renewable energy initiatives taken by MECL and advised MECL to look for opportunities, get aligned with the international trend and utilize the appropriate moment to enter this sector after proper due diligence.

Along with Mr. Duan Zhibin, Chairman of the Board, he thanked MECL team for all the arrangements, presentations, and for conducting the meeting in an efficient manner.

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