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OVL to get stake in Myanmar oil and gas block

Despite losing out in competitive bidding, ONGC Videsh Ltd (OVL), the overseas arm of state explorer Oil and Natural Gas Corp, may still get a stake in a deep-sea block in Myanmar.

OVL had bid for two of the 10 shallow-water blocks that Myanmar had auctioned in December but drew a blank when the fields were awarded on March 26.

“We had a pre-bid understanding with an international oil company that if we were to win any shallow-water acreage, they will farm-in (pick up stake). Similarly, in case that company was successful in picking up any of the deep-sea acreages it bid for, we would get a stake,” OVL Managing Director S P Garg said.

Garg refused to identify the company and said OVL could get up to 49% in the deep-water oil and gas block won by the international company.

London-based Ophir Energy plc and Total of France each won a deep-sea block in Myanmar’s maiden licensing round. While Ophir won the AD-3 deep-water block, Total won the YWB block. Italy’s Eni picked up deep-water blocks MD-2 and MD-4 on its own.

The other deep-sea blocks went to groups of global energy majors and it is unlikely that OVL had a pre-bid understanding with them.

Anglo-Dutch supermajor Royal Dutch Shell was awarded deep-water blocks AD-9, AD-11 and MD-5 as operator, all alongside Japan’s Mitsui Oil Exploration, according to Myanmar’s Ministry of Energy.

US giant ConocoPhillips won deep-water block AD-10 with Norwegian state-owned Statoil as operator.

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