NEW DELHI, India -- ONGC Videsh signs definitive agreements to acquire 12% interest in Brazil’s BC-10 Block

10/14/2013

ONGC Videsh signs definitive agreements to acquire 12% interest in Brazil’s BC-10 Block

NEW DELHI, India -- ONGC Videsh, through its affiliates, has signed definitive agreements to acquire a 12% Participating Interest (PI) in Block BC-10 offshore Brazil.

ONGC Videsh (OVL) had earlier acquired a 15 % PI in the block in 2006. The other partners in the block were Shell (operator) with a 50% PI and Petrobras with a 35% PI. In August 2013, Petrobras entered into a Sales Transaction with Sinochem for disposal of their 35% PI in BC-10 for $1,543 million.

This agreement was subject to the pre-emption rights of the partners Shell and ONGC Videsh. A Pre-emption Notice was served on September 17, 2013, by Shell and ONGC Videsh to jointly acquire 35%, in which 12% PI corresponds to ONGC Videsh.

As a follow up of the notice, ONGC Videsh, through its affiliates, signed Sale and Purchase Agreements with Petrobras on October 11, 2013, for acquisition of a 12 % PI in the block, for $529.03 million. On closing, the PI of OVL would increase to 27%. The acquisition of additional PI in the block is subject to approval of the Brazilian antitrust and regulatory authorities.

The BC-10 Block, also known as Parque das Conchas, is in Brazil’s Campos basin. It includes 4 offshore deepwater fields (Ostra, Abalone, Argonauta and Nautilus) and a few identified exploration prospects. The license for the fields expires in December 2032.

In a separate development, ONGC Videsh has been awarded two onshore blocks, namely B2 (Zebyutaung-Nandaw) and EP-3 (Thegon-Shwegu), in the Myanmar Onshore Bidding Round 2013. This was announced by the Ministry of Energy, Republic of the Union of Myanmar. Block B-2, having an area of 16,995 sq km, is located in northern Myanmar, and Block EP-3, having an area of 1,650 sq km, is located in central Myanmar.

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