New Delhi: The Cabinet Committee on Economic Affairs today gave its approval to authorize ONGC Videsh Limited (OVL) to acquire Participating Interest (PI) owned by Hess Corporation's wholly-owned subsidiaries in the upstream and midstream oil and gas assets in Azerbaijan comprising 2.7213 percent PI in the Azeri Chirag Guneshli (ACG) contract area and 2.36 percent PI in Baku-Tbilisi-Ceyhan (BTC) pipeline for an investment of US$ 1001 million, plus certain adjustments including working capital, interest from the economic date and other defined elements on cash sink basis, and also authorized OVL to incur expenses so as to keep the total exposure up to the approved amount i.e. US $ 1001 million at all times.
The acquisition shall provide OVL, oil production of about 1 Million Ton per year for about a decade. In addition to oil revenue, the investment would enable OVL to enter into Azerbaijan, which is rapidly emerging into a strategically important country in the CIS region. Acquiring a stake in the strategic BTC pipeline would provide OVL the opportunity to enhance its portfolio around the region and transport crude from future assets, which the company may acquire in the Caspian Sea in the future.
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