OREANDA-NEWS. Financial results of ONGC Videsh Limited (OVL), the wholly-owned subsidiary of ONGC, for the quarter ended 30th June, 2013 were considered and approved by the Board of Directors in its meeting held on 31st August 2013.

During the quarter ended 30th June, 2013, the company earned profit of Rs 837 Crore, an increase of 71.9% as compared to the corresponding period of the previous quarter.

Oil production is higher mainly due to production from newly acquired ACG fields in Azerbaijan and resumption of production from South Sudan.

A. Highlights:

OVL currently has participation in 32 projects in 16 countries, out of which 11 are producing projects, 5 discovered/ under-development projects, 14 exploratory projects and 2 pipeline projects.

1. New Acquisitions

The Company together with Oil India Limited (OIL) has signed definitive agreements on 25th June 2013 with Videocon Mauritius Energy Limited to acquire 100% of shares in Videocon Mozambique Rovuma 1 Limited, the company holding a 10% participating interest in the Rovuma Area 1 Offshore Block in Mozambique (Area 1) for USD 2,475 million. The acquisition is subject to the approvals of the Governments of Mozambique and India, relevant regulatory approvals, pre-emption rights and other customary conditions. Approval of Government of Mozambique has been received and period available for pre-emption right has lapsed. The transaction is expected to close in the fourth quarter of 2013.

For the same block as mentioned above (i.e. the Rovuma Area 1 Offshore Block in Mozambique (Area 1)), the Company has also signed definitive agreements on 24th August 2013 with Anadarko Mocambique Area 1 Limitada (“Anadarko”) to acquire a direct 10% participating interestin the block for USD 2,640 million.The acquisition is subject to the approvals of the Governments of Mozambique and India, relevant regulatory approvals, pre-emption rights and other customary conditions. The transaction is subject to usual closing conditions and has long stop date of 28th February 2014.

Area 1 covers approximately 2.6 million acres in the deep-water Rovuma Basin offshore Mozambique and represents the largest gas discovery in offshore East Africa with estimated recoverable reserves of 35 to 65 trillion cubic feet.

2. Operations

The current geo-political situation in Syria including EU sanctions and the resulting restrictions on Contractor continues to remain difficult since December 2011.

First Gas delivery commenced from Blocks A1 & A3 in Offshore Myanmar on 15 July 2013 with 1.7 MMSCMD. The field is producing currently at 2.17MMSCMD. Production is expected to reach 5.67 MMSCMD in March 2014 and will reach peak level of 14.50 MMSCMD in Q1 of 2015. OVL has 17% share in the fields.

B. Long Term Plans:

The company continues to pursueopportunities towards energy security for the country through both organic and inorganic growth by participating in bidding rounds in exploration blocks and acquiring discovered/producing oil and gas projects overseas with strategic target to reach production level of 20 MMToe p.a. by FY'18 and 60 MMToe p.a. by FY'30.

Speaking on the occasion, Chairman Shri Sudhir Vasudeva complimented OVL team for their success in Mozambique as well as their good operational & financial performance.