NEW DELHI: ONGC Videsh Ltd (OVL), the overseas arm of Oil and Natural Gas Corp, on Tuesday signed a sale agreement with OMV Aktiengesellschaft of Austria for buying the latter's stake in two onshore exploration blocks in Sudan for $115 million.
"OVL has bought out 26.125 per cent stake in exploration block 5A and 24.5 per cent stake in block 5B from Austria's OMV," company sources said.
The exploration blocks 5A and 5B are located in the Muglad basin and are adjacent to the Greater Nile Oil Project, where OVL acquired 25 per cent stake in March this year from Talisman Energy Inc of Canada.
"This is an important acquisition for OVL, as it consolidates our presence in oil bearing region which continues to show high potential and also strengthens the company's position as a major player in the global oil and gas market," OVL Managing Director, Atul Chandra said.
The transaction is subject to approvals from the Sudanese Government and project partners.
The sale agreement for the Sudan exploration blocks were signed at Amsterdam by V Ravindranath, Executive Director, OVL and Paul Griggs, Vice President (Business Development), OMV.
Block 5A, which contains the undeveloped Thar Jath field with gross proven and probable oil reserves of 149.1 million barrels, has Petronas Carigali Overseas Sdn Bhd of Malaysia as operator with 68.875 per cent stake. Sudan's national oil company Sudapet has remaining 5 per cent.
In Block 5B, Petronas has 41 per cent, Sudapet 10 per cent, OMV 24.5 per cent and Swedish oil concern Lundin Petroleum AB 24.5 per cent.
Block 5A, located in the Muglad Basin in Southern Sudan, contains an undeveloped Thar Jath field which contains gross proven and probable oil reserves of 149.1 million barrels.
Third party estimates put the possible potential reserves in the block, which measures 20,917 km and has four previously drilled wells, at over 2 billion barrels.
Block 5B is a large block of 20,119 square km and is located in the Sudd swamp. Gravity and seismic interpretation show that the Muglad rift basin extends into Block 5B and that the structural style in the area is similar to the rest of the basin where more than 1 billion barrels of oil have been discovered to date.