In order to strengthen the energy cooperation both India and Russia came up with a series of deals with Russian giant Rosneft for stakes in Siberian oil fields. This further includes a $1.28 billion share to a consortium of Indian producers so that something in monetary terms gets them going and in a good motivating manner. Dharmendra Pradhan, Oil and Gas minister of India held a meeting for signing of these $4.2 billion worth of agreements with the head of state-owned Rosneft who is also considered a close friend of Vladimir Putin. One of the officials stated that “The signed documents literally mark the turning of a new leaf in the cooperation between Russia and India in the energy sector”.
Joint Secretary for international cooperation at India’s oil ministry, Sudhir Sunjay has informed this deal to basically allot 29.9% stake of Taas-Yuriakh Neftegazodobycha and a 23.9% stake in Vankorneft, to the group of three Indian companies. Along with this Rosneft has offered 11% in Vankorneft to Oil & Natural Gas Corp., as an accession to the 15% that India’s prime explorer bought for $1.27 billion in the month September.
The main driving force behind this huge deal is the space that it allows for India to take great advantage of low crude prices that will aid to secure provisions which are to needed to meet the increasing demand. On the other hand even Rosneft requires investments from Asia to expand its funds. Rosneft and the Indian companies have also signed prelude agreements previously during Prime Minister Narendra Modi’s trip to Russia in December. It was when the news got out stating Indi being all set to overtake Japan as the world’s third biggest oil user.
According to Rosneft chief executive officer, Igor Sechin, these deals “establish a reliable energy bridge between our countries” and as a result, “Indian companies gaining access to production projects within the territory of Russia, and Rosneft is gaining access to the opportunity to operate in the Indian market.”
In respect to this, Mr. Pradhan said the agreements were “a remarkable achievement” and “It is of prime importance that the cooperation is of a long-term nature and it will deliver significant multiplicative effect for the economies of both countries,” It is through him that the Financial Times got the news feed stating the nation to acquire $25 billion as investment and how it will unlock $40 billion in hydrocarbons.
It seems India will no longer be the only one to not have invested in Russia.