ONGC Close to Buying 40% of Kazak Block

January 15, 2009

By Nidhi Verma, Reuters

India's ONGC Videsh is close to buying a stake of up to 40 percent in the Satpayev block in Kazakhstan, an oil ministry official told reporters on Monday.

"We hope to get a 30-40 percent stake in the block. Oil secretary R.S. Pandey and ONGC Videsh officials have gone to Kazakhstan to finalise the deal," the official, who did not want to be identified because the deal had not yet been signed, told reporters on the sidelines of the Petrotech conference.

The official said the deal may be signed during a visit to India by Kazakhstan's President Nursultan Nazarbayev in the next few weeks.

ONGC Videsh, the overseas arm of state-run explorer Oil and Natural Gas Corp, has bought stakes in projects in several countries to secure energy supplies for India, which imports 70 percent of the oil it consumes.

ONGC Videsh owns oil and gas blocks in Vietnam, Russia, Syria and Colombia and has made discoveries in Egypt, Qatar, Brazil and Myanmar.

In 2005, the Kazakh government signed a memorandum of understanding with ONGC for the offshore block Satpayev with estimated reserves of 1.85 billion barrels, but did not reach a firm agreement.

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