ONGC Videsh inks pact with Argentine national firm YPF
5 Sept 2014 5:18 AM IST
OVL and YPF signed a memorandum of understanding (MoU) on Monday to cooperate in the hydrocarbon sector, the company said in a statement here.
‘Under the MoU, the two companies will analyse the opportunities for cooperation in upstream sector in Argentina, India and third countries,’ it said.
The MoU also envisages collaboration in the areas of research and development and human resources.
‘Argentina is an important oil and gas producing country in Latin America. It also has excellent potential for unconventional oil and gas (tight/shale), particularly in the Neuquén Basin,’ the OVL statement said.
OVL is India's largest international oil and gas company with stakes in 35 projects in 16 countries including Azerbaijan, Bangladesh, Brazil, Colombia, Iraq, Kazakhstan, Libya, Mozambique, Myanmar, Russia, South Sudan, Sudan, Syria, Venezuela and Vietnam.
It currently produces about 160,000 barrels of oil and oil equivalent gas per day and has total oil and gas reserves of 637 million tons of oil equivalent as on March 31.
YPF SA, a 51 per cent majority-owned entity of the government of Argentina is an integrated energy company. It is the main oil producer in Argentina, with more than 41 per cent market share of oil and gas.
It has three strategically located refineries in the country and a network of over 1,500 service stations. Meanwhile, an association of top energy firms, including Reliance Industries, Cairn and BP has demanded a natural gas pricing policy that is ‘legitimate, relevant and credible’ to maintain investor interest in Indian E&P sector.
In its submission to the four-member panel of secretaries working out a new gas pricing mechanism, Association of Oil and Gas Operators (AOGO) said the government had awarded areas for exploration of oil and gas under New Exploration Licensing Policy (NELP) ‘on the basis of maximising government share and not lowest price of hydrocarbons.’
The production sharing contracts (PSC) government entered into firm like RIL for exploration and production (E&P) provides for marketing freedom to contractors for sale of gas within India at arm’s length to the benefit of all the parties to the contract.
The government, as per PSC, has limited role of only ‘approving a formula or basis for sale of gas,’ it said, adding, the contract enjoins both government and the explorer to operate on the principle of maximising the total revenue.
A four-member panel of secretaries from different ministries is holding consultations to work out a new gas pricing mechanism, as the Rangarajan formula of doubling rates to $8.4 per mmBtu was not acceptable to the new government.
‘Subsidies borne by the government are extraneous to the PSC and cannot form any part of the calculus for determining the basis of pricing under PSC,’ AOGO said.
AOGO said any country looking for private sector participating to explore its vast unexplored basins needs to maintain the sanctity of contract.
‘Under the MoU, the two companies will analyse the opportunities for cooperation in upstream sector in Argentina, India and third countries,’ it said.
The MoU also envisages collaboration in the areas of research and development and human resources.
‘Argentina is an important oil and gas producing country in Latin America. It also has excellent potential for unconventional oil and gas (tight/shale), particularly in the Neuquén Basin,’ the OVL statement said.
OVL is India's largest international oil and gas company with stakes in 35 projects in 16 countries including Azerbaijan, Bangladesh, Brazil, Colombia, Iraq, Kazakhstan, Libya, Mozambique, Myanmar, Russia, South Sudan, Sudan, Syria, Venezuela and Vietnam.
It currently produces about 160,000 barrels of oil and oil equivalent gas per day and has total oil and gas reserves of 637 million tons of oil equivalent as on March 31.
YPF SA, a 51 per cent majority-owned entity of the government of Argentina is an integrated energy company. It is the main oil producer in Argentina, with more than 41 per cent market share of oil and gas.
It has three strategically located refineries in the country and a network of over 1,500 service stations. Meanwhile, an association of top energy firms, including Reliance Industries, Cairn and BP has demanded a natural gas pricing policy that is ‘legitimate, relevant and credible’ to maintain investor interest in Indian E&P sector.
In its submission to the four-member panel of secretaries working out a new gas pricing mechanism, Association of Oil and Gas Operators (AOGO) said the government had awarded areas for exploration of oil and gas under New Exploration Licensing Policy (NELP) ‘on the basis of maximising government share and not lowest price of hydrocarbons.’
The production sharing contracts (PSC) government entered into firm like RIL for exploration and production (E&P) provides for marketing freedom to contractors for sale of gas within India at arm’s length to the benefit of all the parties to the contract.
The government, as per PSC, has limited role of only ‘approving a formula or basis for sale of gas,’ it said, adding, the contract enjoins both government and the explorer to operate on the principle of maximising the total revenue.
A four-member panel of secretaries from different ministries is holding consultations to work out a new gas pricing mechanism, as the Rangarajan formula of doubling rates to $8.4 per mmBtu was not acceptable to the new government.
‘Subsidies borne by the government are extraneous to the PSC and cannot form any part of the calculus for determining the basis of pricing under PSC,’ AOGO said.
AOGO said any country looking for private sector participating to explore its vast unexplored basins needs to maintain the sanctity of contract.
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