ONGC Videsh, Slaveneft to Sign Oil Deals With Iraq
Indian oil company ONGC Videsh Ltd. (OVL) is set to sign an agreement to explore Block 8 in the western desert of Iraq with Oil Exploration Co. of Iraq on November 28th, according to company officials on November 27th.
An official said that: “It allows the OVL to undertake exploration-related activities which do not violate U.N. sanctions.” He indicated that all details had been finalized, except for the date from which the contract will come into effect.
OVL, a subsidiary of Oil and Natural Gas Corp. (ONGC), had made an offer for the block in 1998, but Iraq asked for a renegotiation in August.
Block 8 is considered to have high prospects, due to its close proximity to the Abu Khema oilfield, discovered by ONGC in 1974-77. Estimates in 1998 put production capacity for the Abu Khema field at 12,000 b/d of crude.
The Russian-Belarussian oil company Slaveneft will sign a deal to develop the Shubba oilfield in Iraq in December, a senior executive said on November 24th. The executive said that: “All positions have already been agreed.
We are doing the feasibility study now, working out the scheme of moving necessary equipment there.” Slaveneft had said in September that it would petition the U.N. to allow it to work in Iraq beginning in 2001, if sanctions were still in place.
The official said that: “We are ready to appeal to the U.N. sanctions committee with a detailed explanation of what we are going to do and how we are going to do it, in order to try to get special permission to work at full scale.
” The sanctions imposed on Baghdad after its 1990 invasion of Kuwait bar foreign companies from developing oil fields in the country.