In what can be termed as a setback for one of India's major stake buy deal in a significant oilfield abroad in recent times, state-run explorer Oil and Natural Gas Corp (ONGC) on Wednesday confirmed that its $5 billion acquisition of a stake in Kazakhstan's biggest oilfield has been blocked by the Central Asian nation.
Kazakhstan Government has exercised its pre-emption rights to block ONGC Videsh ltd's (OVl, the overseas arm of ONGC) deal to buy ConocoPhillips' 8.4 per cent stake in the Kashagan oilfield.On Tuesday when The Pioneer had asked OVl Chairman D K Sarraf to confirm the development, he had said that the company had received no such information from Kazakhstan Government.
The Kashagan deal was OVl's largest acquisition ever. OVl said it has received a communication from ConocoPhillips that Government of Kazakhstan has exercised “its priority right and pre-empted” the Indian company's bid to acquire 8.4 per cent stake. According to Kazakh law, that Government has the right to buy any oil asset for sale in the country at the price agreed on by buyer and seller.
Kazakhstan's national oil company KazMunaiGaz will buy the US oil company's 8.4 per cent interest in the world's largest oil find in five decades for about 5billion. OVl further said it had in November last year finalised definitive agreements for acquisition of ConocoPhillips' stake in the oilfield.