31 May 2016 Current Affairs: ONGC Videsh Ltd (OVL), the overseas arm of state-run explorer Oil and Natural Gas Corporation (ONGC), has announced it has signed a Memorandum of Understanding (MoU) with SOCAR Trading SA, the trading arm of Azerbaijan's government-owned energy firm SOCAR, for foraying into oil trading business.
The objective of the MoU, signed in Geneva on 27 May, is to explore possibilities of joint marketing of OVL's crude oil portfolio by leveraging SOCAR Trading's experience in oil trading, OVL.
The Azeri-Chirag-Guneshli (ACG) field is located off the coast of Baku and is said to be the largest oilfield in the Azerbaijan sector of the Caspian basin. OVL had earlier bought a 2.7 per cent stake in the field from US-based Hess for $1 billion.Based on the performance of this agreement both parties will mutually agree to optimize price realization of other crudes from OVL's portfolio either through joint marketing or joint venture route.
OVL operates 36 projects in 17 countries including Azerbaijan, Bangladesh, Brazil, Colombia, Iraq, Kazakhstan, Libya, Mozambique, Myanmar, Russia, South Sudan, Sudan, Syria, Venezuela, Vietnam and New Zealand. It currently produces 165,000 barrels of oil and oil equivalent gas per day and had total oil and gas reserves of around 632.65 million tonne of oil equivalent at the end of March 31.
SOCAR trading is the international marketing and development arm of State Oil Company of Azerbaijan republic (SOCAR). SOCAR trading was incorporated in December 2007 with a mandate to market Azeri barrels produced from the ACG field and other surrounding fields in Azerbaijan.