ONGC to acquire ConocoPhillips' Kazakh oilfield stake for $5 bn

India's state-owned Oil and Natural Gas Corporation (ONGC) is buying US oil and gas giant ConocoPhillips' 8.4-per cent stake in Kazakhstan's Kashagan oilfield for approximately $5 billion.

The acquisition marks the Indian company's largest ever overseas acquisition so far. Earlier in 2009, ONGC had acquired Britain's Imperial Energy Corp Plc which as operations in Siberia, for around $2.1 billion. It is also the second-largest acquisition by an Indian company after mobile phone operator Airtel acquired Kuwait-based telecom company Zain for $9 billion two years ago.

ONGC's wholly owned subsidiary ONGC Videsh Ltd (OVL) will acquire stake in the prolific Kashagan oilfield located in the North Caspian Sea, which holds an estimated 30 billion barrels of oil of which 8-12 billion are potentially recoverable. The Kashagan field is located in shallow waters of 5-8m depth.

''ONGC Videsh has finalised definitive agreements for the acquisition of the 8.4-per cent participating interest of ConocoPhillips in the North Caspian Sea Production Sharing Agreement that includes the Kashagan Field, in Kazakhstan,'' OVL said in a statement.

OVL is India's largest international oil and gas exploration and production company. Its activities are spread over15 countries.

The partners of Kashagan project include seven global oil and gas giants including Italy's Eni SpA, France's Total SA, Royal Dutch Shell Plc, US' ExxonMobil Inc, and Kazakhstan's KazMunaiGaz each holding 16.8 per cent stake, ConocoPhillips with 8.4 per cent interest and Japan's Inpex Corp with the remaining 7.6 per cent.