Monday, August 14 2006 18:09 Hrs (IST) - World Time -

Dehradun: State-owned ONGC Videsh Ltd (OVL), which has won the bid for 50 percent assets of Omimex de Columbia with Chinese oil major Sinopec, expects around one million tonnes of oil as its share from the producing block, Petroleum Minister Murli Deora said here today (Aug 14, 2006).

"Our bid in Columbia has been accepted and this will give us one million tonnes of oil annually," Deora said at the golden jubilee celebrations at the headquarters of energy major Oil and Natural Gas Corporation (ONGC) here.

The acquisition of 50 percent assets by OVL and Sinopec is expected to be completed by the end of this month, petroleum ministry officials said.

Under the over $800 million deal, ONGC and Sinopec will take 25 percent stake each in Omimex de Columbia, a wholly owned subsidiary of US based exploration and production company Omimex Resources.

Columbia's national oil company Ecopetrol will continue to hold the remaining 50 percent stake in Omimex.

Omimex de Columbia has onshore producing, as well as exploration blocks in Columbia, with net proven reserves of around 157 million barrels. Called project Amazon, the producing and exploration block currently produces 900,000 barrels per day. This is expected to be raised further.

Official sources said it was a very good property as only a small area of the block has been fully explored, raising prospects of higher oil yield in the future.

"We expect the property to yield oil for us for the next 20 years," ONGC sources said.

This is the second property ONGC Videsh has acquired with a Chinese company. It had earlier forged a tie up with China National Petroleum Company International to acquire about 37 percent stake in Syrian oilfields of Canadian oil company Petro-Canada for $484 million.

"OVL today is sourcing more than six million tonnes of oil and oil equivalent gas per year with presence in 14 countries having 24 oil and gas projects," said ONGC Chairman and Managing Director R.S. Sharma.