Satpayev stake buy: ONGC to partner Mittal

The government has given Oil and Natural Gas Corporation nod to partner billionaire Lakshmi N Mittal for buying out 25 per cent stake in Kazakhstan's prospective Satpayev oilfield in the Caspian Sea.

ONGC Mittal Energy Ltd, the joint venture of ONGC Videsh Ltd and Mittal Investment Sarl, plans to invest $400 million in the Satpayev oil field, official source said.

The Cabinet Committee on Economic Affairs last evening gave OVL, the overseas arm of the state-run explorer, approval to invest its share of $204 million in the oilfield.

OMEL will pay $26 million as signing amount to the Kazakhstan government for 25 per cent stake in Satpayev field. Besides, the partners will also pay $80 million as one-time assignment fee, they said.

Over and above these, the two have committed a minimum exploration investment of $165 million and an additional optional exploration expenditure of $235 million.

Satpayev is situated in highly prospective region of North Caspian Sea and in proximity to at least four fields. A peak output of 287,000 barrels per day is envisaged from the 256 million tons of reserves in the field.

Kazakh national oil firm KazMunaiGas will be the operator of the field, holding remaining 75 per cent stake.

OVL, the overseas arm of state-run ONGC, and Mittal Investment Sarl are equal partners in OMEL.