ONGC Signs Pact to Acquire Entire Stake of GSPC in KG Block for $1.2 billion
Posted on:20 Mar 2017 09:49:53
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20 March 2017 Current Affairs: State-owned Oil and Natural Gas Corporation (ONGC) has signed definitive agreements to buy Gujarat State Petroleum Corporation’s (GSPC) entire 80% stake in KG-basin natural gas block for $1.2 billion.
The company will close the deal and pay debt-ridden GSPC the money after getting the regulatory approvals like government nod for transfer of participating interest (PI) and change of operatorship.
Under the farm-in and farm-out agreement, ONGC will pay $995.26 million for three discoveries in the KG-OSN-2001/3 block that are under trial production since August 2014.
Besides, another $200 million will be paid for six other discoveries for which GSPC has been finalising an investment plan to bring them to production. ONGC will also have to pay for the entire development cost of the six discoveries
Jubilant Offshore Drilling Pvt Ltd and Geo Global Resources (India) Inc each holds 10% stake in the block.
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