OVL gets extension for five projects

ONGC Videsh, the overseas arm of Oil and Natural Gas Corporation, has received an extension for five projects in Myanmar, Bangladesh, Vietnam, South Sudan and Columbia, which would give the firm more time to explore and boost its growth plans, according to people familiar with the matter.

Some of the projects for which ONGC Videsh has received an extension have already started production. An extension means an increased probability of making new discoveries in the exploration acreages.

ONGC Videsh has stakes in 32 oil and gas projects in 15 countries. In some cases, it is the operator leading the exploration and production efforts for all stakeholders.

In Colombia's CPO-5 block, which ONGC Videsh operates, production has picked up and is expected to soon touch 25,000 barrels per day, a person familiar with the matter said. Similarly, production at its projects in South Sudan has recovered to a large extent after a devastating flood last year.

ONGC Videsh has been present in Myanmar, Bangladesh, Vietnam, South Sudan and Columbia for years. In some projects, it has made discoveries and also put them into production while in others, it is looking for a commercially viable find.

The massive Mozambique gas project in which ONGC as well as a few other Indian state-run firms are invested has yet to take off due to the security situation in that country.

ONGC Videsh has been looking to invest in new oil and gas projects in West Asia, Africa and South America but would prefer fields that are already producing or may do so in the near term.

The company doesn't want to be left with stranded assets when the demand sharply shifts away from fossil fuel to other sources of energy and so is seeking to lower its risks by investing in projects with near-term monetisation opportunities and by partnering with global companies in projects.