New Delhi: State-owned Oil and Natural Gas Corp's (ONGC) acquisition of 10 percent stake in a giant Mozambique gas field had helped the seller make a neat profit of USD 1.5 billion or over 62 percent of the purchase price.
ONGC had in June 2013 bought 10 percent stake in the Offshore Area 1 from Videocon Group for USD 2.475 billion and followed it up with another 10 percent stake buy from US energy major Anadarko Corp for USD 2.64 billion last year.
Anadarko in its annual filings with the US Securities and Exchange Commission said it made a "gain" of USD 1.5 billion from the sale of 10 percent interest in Offshore Area 1.
Under the head 'Divestitures', the company said it made net gains of USD 1.891 billion from sale of stakes in 2014.
"The 2014 proceeds and net gains were primarily related to assets included in the oil and gas exploration and production reporting segment. The company sold a 10 percent working interest in Offshore Area 1 in Mozambique for USD 2.64 billion, recognising a gain of USD 1.5 billion," it said.
The other gains came from sale of its Chinese subsidiary and interest in a Gulf of Mexico block.
Woodlands, Texas-based energy-exploration company Anadarko continues to be the operator of the block, with its stake reduced to 26.5 percent from 36.5 percent after the deal.
ONGC Videsh Ltd, the overseas investment arm of ONGC, had split the 10 percent stake it bought from Videocon for USD 2.475 billion with Oil India Ltd (OIL) in 60:40 ratio.
So, OVL now has 16 percent stake in Offshore Area 1, which holds as much as 75 Trillion cubic feet of gas reserves. OIL has 4 percent and a unit of Bharat Petroleum Corp Ltd (BPCL) another 10 percent.
Other partners in Area 1 include Mitsui with 20 percent stake, ENH (15 percent) and PTTEP (8.5 percent).
Gas from the block is to be converted into liquefied natural gas (LNG) for transportation by ships to markets like India. Indian firms will have access to 30 percent of 60-80 million standard cubic meters per day of planned gas production from the block.
About USD 18.4 billion will be required to bring the first set of finds to production and convert it into LNG.
The Area-1 consortium is focused in looking at bringing first gas by 2019, sources said.
So far, seven gas fields have been discovered in the block. Of these, three fields - Lagosta, Windjammer and Barquentine (collectively called the Prosperidade field) - extend into the adjacent Block Area-4 where Italy's ENI with a 70 per stake is the operator.
The others - Atum, Golfinho and a small field Tubarao, are independent fields lying fully in Block Area-1.
Sources said the consortium is looking at developing the independent fields first.
