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ONGC Videsh Ltd (OVL), the overseas arm of India’s state-owned exploration and production giant, has strengthened its presence in the global oil and gas sector to ensure a sustainable energy supply in the future. The move aims to offset the potential impact of supply uncertainties that may arise if U.S. President Donald Trump assumes office for a second term in January 2025 and takes swift action to bridge the trade deficit with global business partners.
OVL continues to expand its global footprint, holding stakes in 32 oil and gas projects across 15 countries. The company currently produces about 200,000 barrels of oil and natural gas equivalent per day from its international assets.
In recent weeks, OVL has announced two major initiatives to secure additional global energy assets. Last week, the OVL board approved a ₹1,500 crore investment for the rollout of its Mozambique offshore liquefied natural gas (LNG) project. In March 2025, the company announced the acquisition of Equinor’s stake in an oilfield in Azerbaijan and the associated pipeline, for a capital expenditure of US$60 million. Last year, OVL secured a 16-year contract extension for oil and gas production in Vietnam, along with an additional three years to explore a separate block in the contested waters of the South China Sea.
Mozambique project
With the board’s capex approval, ONGC Videsh Ltd (OVL) is now preparing to make headway in its offshore gas exploration project in Mozambique. Reports indicate that on-ground officials have begun work on this joint venture. The project has been under force majeure since April 2021 due to attacks by Islamic State terrorists in northern Mozambique’s Cabo Delgado province. The revocation of force majeure is expected to be announced soon. Notably, OVL holds a 10 percent stake in the US$20 billion ‘Offshore Area 1’ LNG project.
The OVL board has approved an investment of up to ₹1,500 crore in Beas Rovuma Energy Mozambique Ltd (BREML), an OVL subsidiary in which it holds a 60 percent stake, with the remaining 40 percent owned by government-owned upstream player Oil India Ltd (OIL). The board has also approved other related-party transactions, including the sponsorship of a loan of up to US$379.30 million by OVL Overseas IFSC Ltd (OOIL) to Moz LNG Financing Company Ltd (MozLNG1) for the Area 1 Mozambique project.
OOIL is a wholly owned subsidiary of OVL, while MozLNG1 is an associate of ONGC Videsh Rovuma Ltd (OVRL), another wholly owned subsidiary of OVL. OVL will also extend a guarantee in support of MozLNG1 against the loan, the company said in an exchange filing.
The Mozambique Rovuma Area 1 Offshore project spans 2.6 square kilometers and involves an integrated development of gas fields with estimated recoverable reserves of 75 trillion cubic feet of natural gas. It is considered a strategic asset for India due to the relative ease of transporting LNG across the Indian Ocean.
Notably, OVL holds a 10 percent participating interest in the project directly, along with an additional 6 percent interest through its 60 percent stake in BREML. OVL’s offshore area lies within the Rovuma Basin, approximately 40 kilometers off the coast of northern Mozambique. Meanwhile, BPRL Ventures Mozambique BV, an overseas subsidiary of Bharat PetroResources Ltd (a wholly owned subsidiary of BPCL), holds a 10 percent participating interest, while OIL holds a 4 percent stake.
Although the project has faced prolonged delays due to regional security issues, it is now poised to advance with the expected lifting of force majeure by project operator TotalEnergies. The Mozambique LNG project includes the construction of two liquefaction units with a combined annual capacity of 13 million tonnes and is expected to significantly impact global LNG markets.
Equinor stake acquisition
In March 2025, ONGC Videsh Ltd (OVL) announced the acquisition of a stake from Norwegian firm Equinor in an Azerbaijani oilfield and an associated pipeline, for an investment of US$60 million. With this deal, the overseas arm of state-owned ONGC acquired a 0.615 percent participating interest in the offshore Azeri-Chirag-Gunashli (ACG) oilfield, along with a 0.737 percent stake in the Baku-Tbilisi-Ceyhan (BTC) pipeline. The BTC pipeline, crucial for transporting oil from the ACG field, stretches across Azerbaijan, Georgia, and Turkey, linking the Caspian Sea to the Turkish Mediterranean coast.
The acquisition was completed through OVL’s wholly owned subsidiary, ONGC BTC Ltd. The deal, finalized following the signing of a sale-purchase agreement (SPA) in July, is expected to strengthen OVL’s position in key global oilfields. Prior to this acquisition, the company already held a 2.31 percent stake in the ACG field and a 2.36 percent stake in the BTC pipeline. This latest acquisition will increase OVL’s stake in both assets.
Equinor, which had previously agreed in December 2023 to sell all its remaining assets in Azerbaijan to SOCAR (State Oil Company of the Azerbaijan Republic), sold this portion of its stake to OVL. The assets sold by Equinor to SOCAR included a 7.27 percent non-operated interest in ACG and an 8.71 percent interest in the BTC pipeline. However, it remains unclear why Equinor chose to sell a portion of its stake to OVL despite the earlier agreement with SOCAR.
It is worth noting that OVL originally acquired a 2.72 percent stake in ACG in March 2013. Following an amendment to the production-sharing agreement in September 2017, OVL’s stake was reduced to 2.31 percent. BP operates the ACG field, holding a 30.37 percent stake, while other international partners—including Japanese firms and ExxonMobil—also hold interests in the field.
DILIP KUMAR JHA
Editor
dilip.jha@polymerupdate.com
