ONGC Videsh raises $1.2 Billion foreign Loans to buy Russia’s Vankor Stake

ONGC Videsh Raises $1.2 Billion Foreign Loans To Buy Russia's Vankor Stake

New Delhi: ONGC Videsh Ltd has taken a bridge mortgage of $1.2 billion from a collection of foreign banks at a fairly competitive rate of about 1.three according to cent to fund its acquisition of 15 per cent stake in Russia’s 2nd largest oil subject of Vankor.

Banks which include Citi, DBS, Mizuho, popular Chartered and Sumitomo Mitsui Banking Corp have given a nine-month loan to OVL, the remote places arm of country-owned Oil and natural fuel Corp (ONGC), at an interest charge of Libor plus eighty three basis points, assets privy to the improvement said. At one-month common Libor charge, the hobby charge comes to about 1.three in step with cent, they stated.

OVL had in September ultimate yr struck a deal to buy 15 per cent in the Russia’s 2d largest oil discipline of Vankor from Rosneft for $1.268 billion.

sources said the loan is probable to be drawn with the aid of the month give up. it will likely be throughout the route of 9 months replaced by means of an extended-term financing.

OVL had in September last yr signed an agreement to buy 15 consistent with cent stake in Vankorneft, the developer of the Vankor oil and gas condensate subject in Turukhansky district of Krasnoyak Territory in Russia.

In March, OVL signed an preliminary settlement to raise its stake in Vankor to 26 according to cent from 15 in step with cent, whilst three different country agencies — Indian Oil Corp (IOC), Oil India Ltd (OIL) and Bharat Petroleum Corp Ltd (BPLC) — might collectively pick up 23.nine in keeping with cent.

The agreement for added stake has no longer yet finalised, they stated.

Vankor is OVL’s fourth largest acquisition ever.

Vankorneft, a subsidiary of Rosneft, was founded in 2004 to perform the mission of the Vankor discipline development, the most important subject to were found and taken into manufacturing in Russia in the final 25 years.

it’s far placed within the northern a part of jap Siberia, in Turukhansky District of Krasnoyarsk Territory, 142 km from Igarka.

As of January 1, 2015, the initial recoverable reserves within the Vankor area are anticipated at 476 million tonnes of oil and condensate, and 173 billion cubic meters of fuel. The area of the Vankor discipline is 447 square kilometers. Oil and fuel condensate production in 2015 become 22 million tonnes.

The 15 per cent stake will deliver OVL three.three million tonnes consistent with annum of oil manufacturing.

previous to the deal, Rosneft, Russia’s country wide oil agency, held one hundred in keeping with cent stake in Vankorneft.

this could be the fourth largest acquisition by OVL. It had in 2013 paid USD hundred twenty five billion for a sixteen in line with cent stake in Mozambique’s offshore Rovuma vicinity 1, which holds as a whole lot as seventy five Trillion cubic ft of fuel reserves.

In 2009, it had bought Russia-focused Imperial power for USD 2.1 billion. previous to that, it had in 2001 paid USD 1.7 billion for a 20 in step with cent hobby inside the Sakhalin-1 oil and gas subject off Russia’s a long way japanese coast.

Vankor is Rosneft’s (and Russia’s) second largest discipline with the aid of manufacturing and debts for 4 in line with cent of Russian production.

The daily production from the sphere is round 442,000 barrels per day of crude oil on a mean with OVL’s share of daily oil production at about 66,000.
Upon crowning glory of the deal, OVL can have seats on the board of Vankorneft, Rosneft stated.