India considers deeper Russian energy ties with Rosneft stake

Russia has been seeking investors for 19.5% in the state-run Rosneft and is considering selling a stake to India and China to raise at least $11 billion


‘Rosneft is offering its equity in the market and Indian companies are looking into that offer,’ Dharmendra Pradhan told reporters on Thursday. Photo: Manoj Verma/Mint
‘Rosneft is offering its equity in the market and Indian companies are looking into that offer,’ Dharmendra Pradhan told reporters on Thursday. Photo: Manoj Verma/Mint

New Delhi/Mumbai: Indian companies are considering buying a stake in Russia’s biggest oil producer Rosneft OJSC, according to the oil minister Dharmendra Pradhan.

“Rosneft is offering its equity in the market and Indian companies are looking into that offer,” Dharmendra Pradhan told reporters in New Delhi on Thursday. “Our companies are assessing if they can make some investments in the disinvestment of Rosneft.”

Russia has been seeking investors for 19.5% in the state-run Rosneft and is considering selling a stake to India and China to raise at least $11 billion, Bloomberg reported on Monday. The company could be worth as much as $130 billion, CEO Igor Sechin told state television station Rossiya-24 this week, adding the company is not currently talking to Chinese or Indian companies about a deal.

Rosneft press service on Thursday referred to recent comments by Sechin that the government is responsible for decisions about the sale.

Investment in Russia would aid India’s quest for energy security. India imports more than three-fourths of the oil it needs and the country will be the fastest-growing crude consumer in the world through 2040, according to the International Energy Agency.

Ensure security

“The diplomatic relations with Russia has reached such heights that it will ensure India’s energy security for a long term,” Pradhan said. “Indian companies are investing in various oil projects in Russia and the investments are expected to reach $5 billion to $6 billion.”

India’s state-run energy companies are targeting nearly half of Rosneft’s Vankor project, one of the largest Russian oil fields to go into production in the last quarter century. Oil and Natural Gas Corp. (ONGC) has bought 15% in the project for $1.27 billion and is negotiating for 11% more. A consortium of Oil India Ltd, Indian Oil Corp. and Bharat PetroResources Ltd has agreed to buy 23.9% in Vankor. The group has also agreed to take a 29.9% share in Rosneft’s Taas-Yuriakh Neftegazodobycha. Bloomberg

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