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Center asks state-owned enterprises to consider buying Russian oil assets: Report

India has asked state-owned energy companies to assess the possibility of buying European oil major BP’s stake in the sanctioned Russian company Rosneft, said two people with knowledge of the case.

BP has announced that it is giving up its 19.75% stake in Rosneft.

The Ministry of Petroleum announced last week its intention to ONGC Videsh Ltd (OVL), Indian Oil Corp. IOC.NS, Bharat Petro Resources Ltd (BPRL), Hindustan Pertoleum’s HPCL.NS subsidiary Prize Petroleum Ltd, Oil India Ltd OILI.NS and GAIL (India) Ltd GAIL.NS, the sources said.

Indian companies and the oil ministry did not respond to Reuters emails seeking comment.

While Western nations have imposed sanctions on Russia over the war in Ukraine, India has not explicitly condemned Moscow’s actions there.

The world’s third largest oil importer and consumer, India imports about 85% of its 5 million barrels per day (bpd) of oil demand.

The call for Indian companies to investigate the purchase of shares in Rosneft came after BP CEO Bernard Looney met with Indian Oil Minister Hardeep Singh Puri in March.

BP declined to comment.

The Ministry of Oil also asked OVL, the overseas investment branch of Oil and Natural Gas Corp ONGC.NS, to consider buying a 30% stake in Exxon Mobile Corp XOM.N in the Sakhalin 1 project in Russia’s Far East. Exxon is the operator of the project.

OVL already owns 20% of the project.

Exxon said on March 1 that it would leave about $ 4 billion in assets and cease all its Russia activities, including Sakhalin 1.

OVL also owns 26% of the shares in Vankorneft, owner of the Venkor field in the West Siberian basin.

Separately owns a consortium of Oil India, IOC and BPRL, the investigative branch of the state refinery Bharat Petroleum Corp BPCL.NS, a 23.9% stake in Vankorneft and a 29.9% stake in Taas-Yuryakh in eastern Siberia.

One of the sources said that Indian companies hope to get share in Russian assets at reduced prices given the risk involved, and call the potential transactions “emergency sales”.

Another source said that Indian companies had to investigate the impact of sanctions on potential investments and still start a due diligence process.

“The fear is that this investment could linger in Russia as sanctions could prevent us from bringing equity oil and gas to India.”

“Our efforts have been to see how we can stabilize economic transactions, economic commitments with Russia in the current context … There are, of course, restrictions, there are sanctions from some countries, and we will have to work through that,” the spokesman said. for India’s Foreign Ministry, Arindam Bagchi, told a news conference.

Exxon said on Wednesday that its Russian entity Exxon Neftegas Ltd has declared force majeure for its Sakhalin-1 operations due to sanctions against Russia that have made it increasingly difficult to ship crude oil to customers.

Also read: India developed ties with Russia when the US could not do so earlier, Blinken says

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