Indian ONGC Said It Wants to Get a Share of the Oil Produced at Sakhalin-1
CEO of ONGC’s investment division Rajarshi Gupta believes that negotiations with the Russian side and other shareholders could last six months
The Indian company ONGC intends to produce oil as part of its share in the Sakhalin-1 project and expects that negotiations on this could take up to six months. This opinion was expressed by Rajarshi Gupta, CEO of ONGC’s investment division, in an interview with Reuters.
ONGC currently holds a 20% stake in the project.
“It would be better if we could produce and sell our oil,” he said.
At the same time, Gupta noted that the West and allies have imposed sanctions on Russian oil, including a price ceiling of $60 per barrel and restrictions on ship insurance. According to him, negotiations with the Russian side and other shareholders could last six months.
According to media reports, India is reducing oil imports for the third month in a row, including due to maintenance of oil refineries and a reduction in hydrocarbon supplies from the Russian Federation. In August, it decreased in monthly terms by 3.9% to 18.73 million tons.
Sakhalin-1
In the fall of 2022, the Russian Federation transferred the operator of the Sakhalin-1 project to Russian jurisdiction. Instead of Exxon Neftegaz, it became Sakhalin-1 LLC, registered in Yuzhno-Sakhalinsk; the operator’s management company was a subsidiary of Rosneft, Sakhalinmorneftegaz-shelf.
The Russian government allowed the transfer of 20% of the share of the new project operator to the Indian ONGC Videsh Limited, and 30% to the Japanese Sakhalin Oil and Gas Development Co. Ltd. (Sodeco), who announced their intention to remain in the project. Another 20% of the project belongs to Rosneft.
The share of Exxon Neftegas (a subsidiary of ExxonMobil) is 30%. ExxonMobil announced in March 2022 its withdrawal from the Sakhalin-1 project and withdrawal from Russia. In the spring, the company practically stopped production on the project.
In May of this year, the head of Rosneft, Igor Sechin, stated that hydrocarbon production at the Sakhalin-1 project in the first quarter increased by 1.8 times.
