ONGC Videsh Ltd. finalized a US$1 billion purchase of Hess Corp.'s 2.72% stake in the Azeri, Chirag, and Guneshli fields (ACG), and Hess' 2.36% stake in the associated Baku-Tbilisi-Ceyhan (BTC) pipeline, both companies announced the closing on April 1, 2013. The deal is worth an estimated US$884 million after tax net proceeds.
The sale was previously announced on September 7, 2012.
“This sale is another step in the execution of our strategy to become a more focused, higher growth, lower risk pure play exploration and production company,” said John B. Hess, Chairman and CEO. “Consistent with our announcement on March 4, the after tax net proceeds from this sale will be used to pay down an equivalent amount of short term debt.”
ONGC said that this is the first acquisition of a producing property made by the company in the Caspian Region.
ONGC Videsh announced it has also finalized a major multi-billion dollar transaction in the Caspian Region of Kazakhstan, which is under approval of the host Government.
"The Caspian region is an important source of hydrocarbon resources towards the energy security for the country," OGNC said. "(These purchases are) consistent with ONGC's strategic objective of adding high quality international assets to its existing E&P portfolio and also bears significant strategic importance to India."
The ACG fields, located in the Caspian Sea approximately 100km east of Baku, commenced production in 1997. BP operates the fields on behalf of the AIOC coventure, which consists of BP, Chevron, Devon, Statoil, SOCAR, ExxonMobil, Inpex, Itochu and TPAO.