Rosneft and ONGC Videsh sign Memorandum of understanding (MoU)

Rosneft and ONGC Videsh signed a Memorandum of Understanding for the potential acquisition of 11% shares in the Vankorneft by ONGC Videsh in addition to the 15% shares for which the definitive agreement was signed earlier in September 2015. Thus, ONGC Videsh would be acquiring a total of 26% shares in Vankorneft. The MoU was signed by the Managing Director of ONGC Videsh Mr. Narendra K Verma and Rosneft Chairman of the Management Board Mr. Igor Ivanovich Sechin in New Delhi on 16th March 2016 in the presence of Minister of State ( Independent Charge) Petroleum and Natural Gas, Government of India , Mr. Dharmendra Pradhan.
The MoU also provides for the Parties to explore the possibility to conclude Long term crude oil and feedstock supply agreement(s) whereunder Rosneft ( or its affiliates) would supply crude oil to the refineries of ONGC Videsh ( or its affiliates) located in the Republic of India. For the purpose of such agreement(s) , the Parties shall consider using crude oil produced by Rosneft (including Rosneft’s share in Vankorneft) as the main stream with its option to substitute main stream with its alternative grades.
About Vankorneft
Vankorneft is wholly owned subsidiary of Rosneft that operates Vankor field in Russia and was set up in 2004. Vankor field is the largest oil field which has been discovered and brought to production in Russia in the last 25 years.
Vankor oil and gas condensate field is located in the municipal regions of Krasnoyarsk Kray of northern part of East Siberia in the Russian Federation. Vankorneft holds Vankor and Severo (North) Vankor Field Licenses. The Licenses validity has been extended till 2112. Vankor, the giant oil and gas producing field is a key provider of the volumes to the East Siberia Pacific Ocean (ESPO) Pipeline. The field was discovered in the year 1988. Commercial oil production from the field started in the year 2009 and is currently producing about 440,000 bopd.
Background information

ONGC Videsh is a wholly owned subsidiary of Oil and Natural Gas Corporation (ONGC ) , the national oil company of India. It is India’s largest oil and gas exploration and production company outside India. ONGC Videsh owns Participating interests in 36 oil and gas assets in 17 countries and contributes to 14.8% of oil and 12.5% of oil and natural gas production of India respectively. ONGC Videsh partnership with Rosneft started in 2001 when former acquired 20% stake in Sakhalin -I oil and gas project in the Russian Federation.