According to a senior Indian government official familiar with the continuing discussions, Russia has not been receptive to offers made by Indian state-run companies to buy the holdings of Western energy majors in Russian oil and gas assets after they left the sanctions-hit country.
In the background, the Russian government is considering buying the holdings in withdrawn Western companies like ExxonMobil and BP and selling them later at a profit.
Indian state-owned businesses have invested $16 billion in Russia, including in the Far East and East Siberia, in oil and gas assets like Sakhalin-1, Vankor, and Taas-Yuryakh. These businesses include ONGC Videsh Ltd (OVL), Bharat Petroresources Ltd, Indian Oil Corp (IOC), and Oil India Ltd (OIL).
20% of the Sakhalin-1 hydrocarbon block, which ExxonMobil operates, is owned by OVL. A different partnership between OIL, IOC, and Bharat Petroresources controls 29.9% of Taas-Yuryakh Neftegazodobycha, whereas OVL, Oil India, IOC, and Bharat Petroresources own 49.9% of Rosneft subsidiary JSC Vankorneft. Additionally, Imperial Energy Corp. of the UK’s Siberian reserves were purchased by OVL.
In an email answer, a representative for Russia’s Rosneft stated, “On May 15, the operator of Sakhalin-1 decided to suspend production. The project is not currently shipping any oil, and technological processes are being upheld. Rosneft is eager to find a legal solution and resume production on the Sakhalin-1 project with all current shareholders involved.
A group of investors led by OVL, IOC, and Oil India Ltd. wants to contribute to Rosneft’s enormous Vostok project. As part of its strategy for energy security, India has also been exploring participating in Novatek’s Arctic LNG-2 project. India imports 54% of its gas needs and 85% of its oil needs.