ONGC Videsh Ltd, overseas arm of state-run Oil and Natural Gas Corporation, is likely to bid over $300 million to buy Caspian Energy Group LLP's interest in an Azerbaijan oil field.
Code-named Project Golden Goose, OVL is bidding to buy CEG's 51 per cent stake in Shivran Oil Operating Company that operates the Kyurovdag oil field in Azerbaijan, company sources said.
The remaining 49 per cent stake in Shivran Oil Operating Company is held by State Oil Company of Azerbaijan Republic.
The bid, if successful, will mark OVL's entry into the energy-rich Central Asian nation of Azerbaijan. OVL currently has assets in 14 countries including Myanmar, Vietnam, Russia, Egypt, Sudan and Australia but none in Central
Asia.
Sources said the Kyurovdag onshore oil field was discovered and first developed by then USSR in 1955 and Shivran is operating it since June 1996.
The field is believed to hold in-place oil reserves of 4.3 billion barrels, of which 800 million barrels are recoverable.
The field, which is currently producing 4,517 barrels of oil per day, is estimated to produce a minimum of 146 million barrels between 2007 and 2030, 51 per cent of which will belong to OVL if it wins the CEG bid.
The production is projected to rise to 13,300 barrels per day in 2010 and thereafter start declining to reach 2,200 barrels per day in 2030, said the sources. The field is well past its historical peak of 43,000 barrels per day of 1965.
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