Russia's Sakhalin-1 Oil Production Back at Peak 200,000 bpd, ONGC Says

Monday, May 29, 2023

India's state-run Oil and Natural Gas Corp said oil output from the Sakhalin-1 project in Russia has bounced back to its plateau level of about 200,000 barrels per day (bpd) from zero, according to a company presentation.

ONGC hopes to reclaim its 20% stake in the project in coming months after some 'terms and conditions' are fulfilled, Rajarshi Gupta, managing director of ONGC Videsh, the overseas investment arm of ONGC, said at a news conference.

ONGC last year applied to the new Russian operator of Sakhalin-1 to retain its stake in the oil and gas project in the country's Far East, a person familiar with the development said in November.

Gupta said ONGC Videsh is "not in a hurry" to repatriate its less than $100 million pending dividend from the Russian project and could consider reinvesting it in the project.

ONGC Videsh also has a 26% stake in Russia's Vankorneft, a company that owns Vankor Field and the North Vankor licence.

Gupta also said that ONGC Videsh along with other state-run companies are studying recent changes in the terms announced by Guyana for its latest exploration and licensing round for a participation.

Apart from Russia, there is also a dividend pending from ONGC's stake in Venezuela's San Cristobal project in the Orinoco heavy oil belt.

Gupta said ONGC is in talks with U.S. authorities to receive Venezuelan oil against its pending dividend. He did not elaborate on the amount that the Indian company is yet to receive from Venezuela.

Last year the Treasury gave Chevron Corp (CVX.N) a licence to expand operations in Venezuela and export crude to the United States.

ONGC, which has set a 2038 net zero goal, is hoping that gas output from its Mozambique project will start from 2026-27, Chairman A. K. Singh said.

The project, operated by TotalEnergies, was initially set to deliver its first cargo in 2024.

Services group Saipem said it was notified by TotalEnergies to prepare for a restart in July.

(Reuters - Reporting by Nidhi Verma and Rajendra Jadhav; editing by Philippa Fletcher and Jason Neely)

Categories: Energy Industry News Activity Production Asia

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