Oil giants may put Rs 15,500 cr in Russia gas project
In a bold attempt to secure a share in Russia’s gas sector, a consortium of ONGC Videsh, GAIL and Petronet LNG is preparing to invest around Rs 15,500 crore for a 15% stake in Russia’s independent gas producer Novatek’s $30-billion LNG project in Yamal peninsula. Anupama Airy reports. What's in it for Indiabusiness Updated: May 27, 2011 02:03 IST
In a bold attempt to secure a share in Russia’s gas sector, a consortium of ONGC Videsh, GAIL and Petronet LNG is preparing to invest around Rs 15,500 crore for a 15% stake in Russia’s independent gas producer Novatek’s $30-billion (Rs 1,35,000-crore) LNG project in Yamal peninsula.
Novatek will retain 51% equity in the project while the balance 49% will be given to potential investors. France’s Total is also understood to be persuing a 20% stake in the project.
A non-binding indicative bid for a 15% stake in the project is underway and, if successful, the Indian consortium will invest R15,500 crore for a 15% in the project, a company official close to the development told HT.
“The 15% equity of this multi-billion dollar project (to be financed on a debt-equity ratio of 50:50) will be split between ONGC Videsh, GAIl and Petronet LNG as 7.5%, 5% and 2.5% respectively,” the official said.
Global consultants including Gaffney Cline Associates (GCA), Poten & Partners (UK) Ltd (P&P) and Allen & Overy were appointed by the Indian consortium for conducting a due-dilligence of the project, besides preparing an indicative offer.
A joint team comprising of representatives from OVL, GAIL and GCA also visited the data room in Tyumen, pertaining to upstream assets."While Novatek has indicated the project cost to be $16 billion, our consultants have worked out the capex for upstream development and the LNG liquefaction plant as $30 billion," the official said.
The capacity of the plant will be 16.5 million tonnes per annum and the delivery of first LNG from Yamal is expected by 2016.
“The Yamal LNG project will receive supplies from the South Tambeyskoye field located in the north east of the Yamal Peninsula and holds estimated reserves of 1256 billion cubic meters of natural gas and 52 million tonnes of oil,” he said.