Russian Oil Assets
Russian Oil Assets: A state-run energy company in India has been asked to investigate the possibility of acquiring BP’s stake in Rosneft, the sanctions-hit Russian oil firm, according to two people with knowledge of the matter.
Rosneft, a Russian energy company, has announced it will abandon its 19.75% stake.
Russia has sanctioned by the West for its actions in Ukraine, but India has not formally condemned those actions.
With over 5 million barrels of oil consumed daily, India is the world’s third-largest consumer and importer of oil. In March, BP CEO Bernard Looney met with Indian oil minister Hardeep Singh Puri. During the meeting, Looney encouraged Indian companies to explore buying a stake in Rosneft.
Indian companies stood urged to explore buying Rosneft shares after BP CEO Bernard Looney met with the Indian government.
Oil and Natural Gas Corp’s overseas investment arm, OVL
A Russian oil ministry official asked OVL, to look into buying Exxon Mobile Corp’s 30% stake in Sakhalin I in Russia’s Far East. The project stands operated by Exxon.
OVL already holds a 20% stake in the project.
Earlier this month, Exxon announced that it would sell about $4 billion in assets and cease all of its operations in Russia, including Sakhalin 1. OVL also owns 26.2% of Vankorneft in the West Siberian Basin, which owns the Venkor field.
The source said Indian companies may have interested in purchasing Russian oil assets. Moreover, it would be at discount prices due to the risks involved, calling potential deals “distress sales.”
Added a second source, Indian companies are yet to start their due diligence process. Further, it needs to study the impact of sanctions on potential investments.
As a result of sanctions, we may not be able to bring equity oil and gas to India, which why we fear it can get stuck in Russia.”
However, Emails sent to the oil ministry and Indian companies seeking comments but they did not answer.