ONGC: India Government agreement on purchase of group assets from Bashneft and Russbeft has not been achieved yet

The Mministry of India has not yet agreed on buying shares from Bashneft and Russneft by ONGC.

We are discussing this issue but are still in the process of it, chairman of the board of directors of ONGC Hazarik reported.

On December 21st 2010 AFK Sistema and ONGC  signed the framework agreement on forming a joint venture. The companies agreed on concerning the opportunity to consolidate all or some active assets in oil production. 21% of AFK’s assets + 1 share form ANK Bashneft, and 49% shares of OAO Russneft are in regard. From ONGC Videsh  part – 100% of shares of Imperial Energy Corp., which owns some oil deposits in Russia. As a result of agreement, ONGC can get access to development of oil deposits named after R. Trebs and A.Titov (licenced by Bashneft) in Russia.

ONGC Videsh is a branch company of the state company  ONGC that has established good realationship with Russian oil companies for a long time. ONGC has entered Russian oil market in 2010 by purchasing a share in Sakhalin-1 project in 2009. ONGC bought Emperial Energy for  approximately  $2.4 bln. Emperial Energy has assets in the Tomsk region.

OAO Bashneft is the oil production company in Bashkortostan, West Siberia region and the Orenburg region. The main shareholder is AFK Sistema. The company exports oil as well as supplies it to domestic markets. OAO  Bashneft is developing more than 160 deposits, the majority of which are at last stage of development. Bashneft’s net profit in 2010 has increased by 3.4 times in comparison with 2009 reaching $1.429 bln

OAO AFK Sistema was founded in 1993 The company owns and controls different production enterprises in telecommunication sphere (OAO Mobilnie Telesistemy, OAO Moskovskaya Gorodskaya telefonnaya Svyaz, OAO Komstar –Obiyedinennie TeleSistemy), electronics (Sitronics), finance (AKB MBRR and East-West United Bank), real estate and construction (Sistema Gahls), medical services, tourism (Inturist), trade (Detskiy Mir shopping center) as well as it owns petrochemical  enterprises in Bashkortostan. AFK Sistema’s net profit according to US GAAP for the last nine months is $471,452,000 against 2bln 108,046,000 last year.

Source: http://www.oilru.com/news/261371/

Translated by: Anastasia Edrenkina