India has rejected Russia’s offer of stake in five more oilfields in the Vankor Cluster in Siberia as it doesn’t want to concentrate its upstream investments in just one country, people with direct knowledge of the negotiations said. Indian state oil firms are now taking it easy after having invested about $5.4 billion last year to buy substantial stakes in two Russian fields. “We don’t want to put all our eggs in just one basket. Russia can keep offering fields but we can’t keep accepting every offer,” one of the persons cited earlier told ET.
Oil and Natural Gas Corp (ONGC), Oil India, IndianOil and Bharat PetroleumBSE -1.15 % together bought 49.9% in Vankor last year for about $4.22 billion from Russian state firm Rosneft. Indian companies also signed a preliminary pact with Rosneft early last year to buy stake in three satellite fields, referred to as the Vankor Cluster. Oil IndiaBSE 0.11 % is leading the negotiations for five state firms, including ONGC, IndianOil, BPCL and HPCL, which are interested in the Vankor cluster. Mid-way through the negotiations, Rosneft had offered to club five more fields in the same region to the three that were already on the table, another person said.
These five fields are not developed assets. Indian companies had a preliminary look at the offer and then conveyed to Rosneft that they had no interest in the five new fields being offered and would like to limit their negotiations to just three fields of Suzunskoye, Tagulskoye and Lodochnoye that were already being discussed, he said.
This new offer and rejection delayed the negotiation for the Vankor Cluster, which has taken one and a half years and not yet closed, the person cited earlier said. “The evaluation is underway. We have invested enough in Russia, so there is no urgency to quickly seal the deal,” he said. “Besides, there are competing investment opportunities across the globe for Indian oil firms, which have limited capital and wouldn’t want to put all of it in just one region.”
