25% stake for Indian firm in Kazakh gasfield
India opened its hydrocarbon account with Kazakhstan with ONGC Videsh Limited securing a 25% stake in a Caspian Sea exploration block under an agreement signed in Astana on Saturday. HT reports.business Updated: Apr 17, 2011 11:02 IST
India opened its hydrocarbon account with Kazakhstan with ONGC Videsh Limited securing a 25% stake in a Caspian Sea exploration block under an agreement signed in Astana on Saturday.
The two countries also signed a nuclear understanding that expands the scope of bilateral nuclear cooperation dramatically.
Three agreements between OVL and the Kazakh gas firm, Kazmunaigas, gave the former a quarter share of Satpayev Exploration block, as well as defining the operations and carry understanding between the two.
The agreements were signed during Prime Minister Manmohan Singh's state visit to the Central Asian country, consolidating its position as India's largest trading partner in the region.
The Satpayev block, located in the north Caspian Sea, is close to areas which have had successful hydrocarbon finds. Two parts of the block have an estimated 256 million metric tonne in hydrocarbon reserves.
OVL has been trying to secure a foothold in Kazakhstan since 1995. The two firms had signed a MoU in 2005, with more agreements being signed in 2009 and 2010. With the share assignment agreement, OVL has made its first definite entry into this country's hydrocarbon sector.
A new bilateral agreement on the peaceful uses of nuclear energy expands the scope of potential cooperation dramatically.
The expected trade of uranium ore from Kazakhstan and nuclear reactors from India has been expanded to include nuclear medical isotopes, joint mining and reactor design and operations.
This reflects Kazakhstan's interest in moving beyond being a mere ore supplier.
India is agreeable to such efforts because it has connectivity problems with Kazakhstan in any case and it would make more sense to import, say, processed uranium rather than raw ore as this could be conceivably be carried by airplane.
The medical agreement reflects the recent shortage in medical isotopes globally caused by the decline of Canada's nuclear sector, until recently the primary source of such isotopes.