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Wednesday, 07 January, 2009, 17:50 GMT | more >>

ONGC waits on Egypt decision



By Upstream staff 

India’s state-owned Oil and Natural Gas Corporation has confirmed it is set to is all set to acquire a 33% stake in Shell's deep-water block in the north-east Mediterranean, off Egypt.

India’s Union Cabinet is expected to approve ONGC’s proposed investment of $380 million.

The Block has estimated gas reserves of around 14 trillion cubic feet, about the same as Reliance's approved gas find in the Krishna-Godavari basin, and is expected to start production by 2012.

ONGC will, however, be required to take separate approval from the government for further investments towards developing the field.

It has been made clear that the government will not provide additional budgetary support to the company’s overseas arm ONGC Videsh.

"ONGC may provide funds to its subsidiary for acquiring and participation of the project without seeking budgetary support," an official source ttold he Economic Times.

The Cabinet Committee on Economic Affairs meeting scheduled for today is expected to take a final decision in this regard.

The Block is currently held by Shell (84%) and Petronas of Malaysia (16%).

Shell was awarded the deep-water concession to the north of the Nile Delta in 1999.

Out of over half a dozen wells drilled in the field, two have resulted in gas discoveries, confirming the potential of the concession.

ONGC has committed to invest $380 million on the appraisal and exploration of the acreage with a 20% escalation factor.

The company will not pay the 33% share of about $300 million already spent by Shell and Petronas on exploration activities.


Thursday, 14 June, 2007, 01:19 GMT  | last updated: Thursday, 14 June, 2007, 02:01 GMT

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