ONGC Videsh Buys Stake in Azerbaijan’s ACG Oil Field from Equinor
ONGC Videsh Limited, a major Indian oil company, has signed a Sale Purchase Agreement to acquire a stake in Azerbaijan’s Offshore Azeri Chirag Gunashli (ACG) oil field from Equinor ASA. The agreement includes a 0.615% interest in the ACG field and a 0.737% share in the Baku Tbilisi Ceyhan (BTC) pipeline company through its subsidiary, ONGC BTC Limited.
The total investment for these acquisitions is projected to be up to USD 60 million, with the deals expected to be finalized in the coming months. This acquisition will increase ONGC Videsh’s interest in the ACG oil field, adding to its existing 2.31% stake. The company will also expand its stake in the BTC pipeline, complementing its current 2.36% shareholding.
The ACG field, a massive offshore oil reservoir in the Caspian Sea, has been operated by BP since 1999. The field has been developed in phases, with the latest addition of a seventh production platform, Azeri Central East, which began operations in early 2024. The consortium of partners in the ACG field includes SOCAR, MOL, INPEX, ExxonMobil, Turkiye Petrolleri AO, and Itochu, with the field’s contract extending until December 31, 2049.
The BTC pipeline transports oil from the ACG field and condensate from Shah Deniz, stretching across Azerbaijan, Georgia, and Turkiye, linking the Sangachal terminal on the Caspian Sea to the Ceyhan marine terminal on the Turkish Mediterranean coast.
ONGC Videsh Ltd., a subsidiary of ONGC, India’s leading National Oil Company, is a key player in global exploration and production activities. With operations spanning 32 assets across 15 countries, ONGC Videsh aims to bolster India’s energy security by expanding its portfolio of high-quality international assets. In the fiscal year 2024, ONGC Videsh reported an oil and oil equivalent gas production of 10.518 million tonnes, with current production at approximately 200,000 barrels per day. The company’s total Oil & Gas reserves are estimated at 476 million tonnes, compared to its parent ONGC’s reserves of 704 million tonnes as of April 1, 2024. As of July 18, 2024, ONGC’s market capitalization is approximately Rs. 4,16,659 crore.
Equinor ASA, headquartered in Stavanger, Norway, is a global energy enterprise involved in oil, gas, renewables, and low-carbon solutions. The Norwegian state holds a 67% stake in Equinor, making it the principal shareholder.
Doubts Revealed
ONGC Videsh -: ONGC Videsh is a company from India that looks for oil and gas in other countries. It is part of a bigger company called ONGC.
Azerbaijan -: Azerbaijan is a country located between Europe and Asia. It is known for having a lot of oil and gas.
ACG oil field -: The ACG oil field is a big area in the Caspian Sea where a lot of oil is found. It is very important for getting oil.
Equinor -: Equinor is a company from Norway that finds and sells oil and gas. They are selling their share in the ACG oil field to ONGC Videsh.
BTC pipeline -: The BTC pipeline is a long tube that carries oil from Azerbaijan to Turkey. It helps move oil to other countries.
USD 60 million -: USD 60 million means 60 million US dollars. It is a lot of money, and it shows how much ONGC Videsh is paying for the shares.
BP -: BP is a big company from the UK that finds and sells oil and gas. They operate the ACG oil field.
Caspian Sea -: The Caspian Sea is a large body of water between Europe and Asia. It has a lot of oil and gas under it.
energy security -: Energy security means making sure a country has enough energy, like oil and gas, to keep everything running smoothly.