Cabinet approves Russian oil deal: OVL’s 11% stake in Vankorneft to create ‘Energy bridge,’ says Pradhan

Union Cabinet on Wednesday approved ONGC Videsh Limited (OVL)'s acquisition of 11% stake in Russian oil company, Vankorneft.

Dharmendra Pradhan, Minister of State for Petroleum and Natural Gas tweeted that the approval of the deal would go a long way in creating an ‘energy bridge’ between the two strategic partners.

This would go a long way to create a new Energy Bridge between the two Strategic partners .

— Dharmendra Pradhan (@dpradhanbjp) October 5, 2016

The equity oil yielding from this deal would be 3.01 Million Metric Tonnes Oil Equivalent (MMTOE), the Minister said in a tweet.

The equity oil from this will be 3.01 MMTOE.

— Dharmendra Pradhan (@dpradhanbjp) October 5, 2016

"It will also provide an opportunity to Indian public sector Oil and Gas companies to acquire new technologies from Rosneft. The acquisition is in line the ONGC’s stated objective of adding high quality international assets to India's Exploration and Production (E&P) portfolio and thereby augmenting India's energy security," Cabinet committee on Economic Affairs stated.

Pradhan thanked Prime Minister, Narendra Modi for the approval of the acquisition and stated that the total acquisition in Vankorneft and Taas - Yuryakh together amount to 15.18 MMTOE in the last two months.

Thank Hon.PM @narendramodi for approving acquisition of 11% Stake in Vankorneft by @ONGC_ Videsh Ltd from Rosneft,Russia.

— Dharmendra Pradhan (@dpradhanbjp) October 5, 2016

State-owned oil and natural gas company had last year bought 15% stake in the field for $1.268 billion, a report by PTI stated.

OVL and Russia’s Vanok signed the acquisition deal on September 14 for $930 million.