OVL and OIL complete acquisition of Mozambique’s offshore gas field

offshore mozambique-QR9iudjz0 sxc.huArea 1 covers about 2.6mn acres in the deepwater Rovuma Basin. (Image source: QR9iudjz0/sxc.hu)ONGC Videsh Limited (OVL) and Oil India Limited (OIL) have announced the completion of acquisition of Videocon Group’s 10 per cent stake in Mozambican gas field for US$2.47bn

In June 2013, OVL and OIL had agreed to buy a combined 20 per cent interest for US$5bn in the gas field jointly owned by Videocon and US-based Anadarko Petroleum in the Rovuma Area-1.

Payments to Videocon Group to close the deal were made this week, the companies said in a statement. OVL will pay Anadarko Petroleum before end of February this year.

OVL has raised about US$1.5bn in one-year bridge loans from foreign lenders, while OIL borrowed US$900mn to fund their respective share of payments to Videocon Group, PTI reported.

The 10 per cent stake will be split in a 60:40 ratio between OVL and OIL respectively.

Area-1 covers about 2.6mn acres in the deepwater Rovuma Basin and with recoverable reserves estimated at 991mn cubic metres to 1.8mn cubic metres.

”Area-1 has the potential to become one of the world’s largest LNG producing hubs and is strategically located to supply LNG to the growing Indian gas market,” the OVL statement added.

“The Area-1 LNG project is strategically located to competitively supply LNG to India,” OIL added.

 

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ONGC and OIL acquire stake in Mozambique gas field

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