India’s Vostok plan slows as US cos skip sanctions-hit Russia
NEW DELHI : India’s plans to invest in a massive Rosneft project in Vostok have stalled as American consultants who conduct third-party studies and due diligence stay off the sanctions-hit Russian Federation, two officials aware of the development said. In November 2021, Mint reported about a consortium of state-run firms—ONGC Videsh Ltd (OVL), Indian Oil Corp. Ltd (IOCL) and Oil India Ltd (OIL)—completing the technical evaluation of 30 out of 52 licence areas of the Vostok project.
India is also looking to invest in Russia’s liquefied natural gas (LNG) project, Arctic LNG-2, by purchasing a stake from Novatek. The transactions hold importance for India, the world’s third-largest oil buyer. With an estimated reserve of about 6 billion tonnes of crude oil and expected production of 100 million tonnes (mt) in 2030, Vostok is part of a multi-pronged energy partnership between India and Russia.
It is the largest greenfield oil and gas project in the world and comprises 52 licence areas with 13 oil and gas fields, including Vankor, Suzunskoye, Tagulskoye, Lodochnoye, Payakhskoye and Zapadno-Irkinskoye. “We have been exploring investing in other assets in Russia, but there are problems on account of the unavailability of consultants to do due diligence there. Most of the consultants who do third-party studies are US-based," said one of the two people on condition of anonymity.
A top government official said: “These are discussions going on for a long time. Whenever you want to register forward movement on these transactions, you need, first of all, a valuation. We have done a fair amount of acquisitions over the years.
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