From The Economic Times · PTI · · 50s
ONGC Uses Russian Dividends for Sakhalin Fund
ONGC leverages stuck Russian dividends to secure Sakhalin-1 stake and pursue Venezuelan oilfields operatorship.
In brief
ONGC leverages stuck Russian dividends to secure Sakhalin-1 stake and pursue Venezuelan oilfields operatorship. ONGC used $800 million in Russian dividends to retain its 20% stake in Sakhalin-1 and seeks operatorship of Venezuelan oilfields. Originally reported by The Economic Times.
ONGC Dividend Stuck in Russia
ONGC used $800 million in Russian dividends to meet Sakhalin-1 abandonment fund obligations.
“ongc videsh ltd, the overseas investment arm of india's top explorer ongc, and other state-run indian companies had not been able to repatriate about $800 million in dividends from stakes in russian energy assets due to western sanctions imposed after moscow's invasion of ukraine in 2022”
Sakhalin-1 Stake Retained
ONGC retained 20% stake in Sakhalin-1 project after using dividends for abandonment fund.
“in october 2022, russian president vladimir putin had ordered the seizure of the project and allowed the russian government to decide foreign investors' ownership rights in the project”
Venezuela Operatorship Negotiations
ONGC Videsh seeks operatorship of San Cristobal and PetroCarabobo oilfields in Venezuela.
“we are trying to see a new type of operating arrangement where we will take the operatorship, and we will run the project”
Venezuela Projects Details
OVL holds 40% stake in San Cristobal and 11% in PetroCarabobo through venezuelan oil projects.
“the two projects were originally intended to provide indian companies access to venezuela's substantial hydrocarbon reserves and diversify india's overseas crude oil portfolio”
Venezuela Dividend Dues
Approximately $500 million in Venezuelan dividends remain outstanding for ONGC.
“the company is examining whether the dues could be settled as part of the proposed operating arrangements or through a separate agreement”
Operatorship Benefits
New operatorship structure allows OVL greater control over production and revenue handling.
“now, in the new arrangement, we will have offtake rights. we will be operating the project. we will update the produce. we will sell”
In short
ONGC used $800 million in Russian dividends to retain its 20% stake in Sakhalin-1 and seeks operatorship of Venezuelan oilfields.
