ONGC Videsh Expects $60 Million Annually From Vietnam Project

Kolkata, December 21: | Updated: Dec 22 2002, 05:30am hrs
The ONGC Videsh Ltd (OVL), a fully-owned subsidiary of the government-owned Oil & Natural Gas Corp Ltd (ONGC), is expecting an annual revenue of $60 million from its Vietnam operations, according to ONGCs chairman and managing director Subir Raha.

Commercial production and marketing of gas from Vietnam gas fields has started in December according to schedule, said Mr Raha, who is also the chairman of OVL.

The ONGC Videsh Ltd has developed Vietnams largest gas fields Lan Tay and Lan Do in block 6.1 in partnership with British Petroleum and PetroVietnam. OVL has a 45 per cent participating interest in the project, and its share of the development expenditure is around $228 million.

The combined recoverable gas reserves from the two fields are estimated at about 58 billion cubic metre (BCM).

The entire gas is likely to be utilised by Vietnam. This south-east Asian country has plans to set up a number of gas-based power plants in that country.

Mr Raha said, ONGC has really become a global player through OVL. It will be investing a total of $1,741 million till 2005 in Shakhalin-1 project in Russia. This would include the carry loan amount.

The ONGC Videsh Ltd has acquired 20 per cent participating interest in the project.

In Shakhalin-1, estimated recoverable hydrocarbons include about 307 million tonne of oil and condensate and 485 billion cubic metre gas with upside potential of both.

The ONGC Videsh Ltd is developing the project in consortium with Exxon-Mobil, Sodeco, RN Astra and SMNG, with Exxon-Mobil as operator. The Russian authorised state body has approved the commercial viability of the Sakhalin-1 project.

The company has incorporated a wholly-owned subsidiary company Shakalin India Inc in Houstone, USA with an initial paid-up capital of $1,000 and authorised capital of $1 million to assist in the management of operations of Shakhalin-1 project.

The production of oil from the Sakhalin-1 field is scheduled to commence from last quarter of 2005, and gas export from 2008.

The company has also started exploration work in block A-1 in Mayanmar in co-operation with Daewoo International Corp, Gas Authority of India Limited (India) and KOGAS. Total investment during the exploration phase would be around $4.3 million.

The company is currently looking at several oil fields and exploration blocks in Sudan, Oman, Iran, Iraq, Nepal, Libya, Indonesia, Venezuela, Ajerbi-jan, Kazakhstan and Qatar, Mr Raha said.