After Petrobras of Brazil, Norway's Norsk Hydro has agreed to take a stake in Oil and Natural Gas Corporation's gas discovery block off the east coast. Norsk Hydro will take 10 per cent stake in the block KG-DWN-98/2 for $26-million and will have the option to raise it to 20 per cent, an ONGC press release said.
ONGC signed an agreement with the Norwegian deepwater export to develop deepwater oil and gas blocks on Monday evening.
The agreement was signed by Director (offshore) N K Mitra and Director (exploration) D K Pande on behalf of ONGC and Tore Torvund, Executive Vice President, Norsk Hydro.
Petrobras had last month picked 15 per cent stake, with an option to raise it to 30 per cent, in the block where ONGC has reported six discoveries, the latest one at UD-1 well being assessed by upstream regulator DGH as holding 2.08
The block sits next to Reliance Industries' 50 trillion cubic feet KG-D6 block. Before farm-in by Petrobras, the block had ONGC holding 90 per cent stake and Cairn India the remaining 10 per cent interest.
ONGC Chairman and Managing Director R S Sharma said his company, Petrobras and Norsk Hydro will do a joint appraisal of the gas discoveries in the block and prepare a development plan. Oslo-based Norsk Hydro will also give ONGC technological support to increase the recovery from Vasai East oil field, off the Mumbai coast.
The state-run oil major will pay $7 million to Norway's second-largest oil company for the job.
Vasai East is an oilfield off the western coast where there are challenges in producing oil from thin oil zones. Norsk has experience for developing such zones in the Troll field.
