There are certain press reports covering acquisition of 50% stake in Lukoil’s subsidiary, Caspian Investment Resources by Mittal Investment. Relevant to this report, section of the media has raked speculative apprehensions about continuity of the Joint Venture between ONGC and Mittal Group in the form of ONGC Mittal Energy Ltd. (OMEL). To clarify the issues to all the stake-holders and the interested parties, the following clarifications are hereby issued jointly by ONGC and Mittal Investment Sarl.
ONGC Videsh Limited (OVL), the overseas arm of Oil and Natural Gas Corporation Limited (ONGC), had entered into an MOU with Mittal Investment Sarl in July 2005 for synergizing their respective strengths for carrying hydrocarbon business for promoting energy security of India. Two companies later entered into a Joint Venture Agreement in October 2005 and formed a joint venture company, ONGC Mittal Energy Limited (OMEL). The JV Agreement incorporated a list of 10 countries where the two partners would participate in hydrocarbon business on an exclusive basis. The JV Agreement also provides a list of another 17 countries where the two partners would work on projects identified by mutual consent on an exclusive basis.
Under this scenario, the press reports which suggest that the ONGC-Mittal joint venture is not running well, are absolutely baseless. Since its incorporation, OMEL has successfully been awarded 2 prosperous blocks in Nigeria – OPL-279 and OPL-285; the production sharing contracts are expected to be signed shortly. OMEL is also in the process of being awarded another prosperous exploration block in Nigeria. OVL’s subsidiary, ONGC Nile Ganga B.V. had acquired interest in a producing property in Syria along with China National Petroleum Corporation, a part of which is held by OMEL.
OMEL is also in an advanced stage of signing a farm-out agreement in respect of an exploration block in Turkmenistan. OMEL has also recently bid for an offshore block in Trinidad & Tobago. In addition, OMEL is looking for various opportunities including in Kazakhstan, Turkmenistan, Azerbaijan, Indonesia, which are at different stages of progression.