Rosneft to complete $10.9-bn acquisition of Essar refinery in a few weeks

Russian oil major Rosneft plans to close its $10.9 billion (Rs72,800 crore) acquisition of Essar Oil and Vadinar refinery within a few weeks.

''We are closing the deal of Essar Oil and Vadinar refinery within a few weeks,'' Rosneft president and chairman told the media on the sidelines of Petrotech Summit in New Delhi.

The Russian oil major has formed a consortium with oil trading firm Trafigura and private investment group United Capital Partners for the acquisition. 

The consortium will be acquiring Essar Oil's 20 million tonne refinery in Vadinar, Gujarat and its retail outlets.

In addition, the consortium will acquire Essar-operated Vadinar Port for an additional payment of $2 billion (Rs13,300 crore).

Roseneft and Essar Oil announced the nearly $13-billion deal, which will be the largest foreign direct investment in India till date, in October this year.

''Our relationship with India has two aspects. Recently, oil companies like Indian Oil Corporation, Oil India and ONGC had acquired stakes in our Vankor and Tass-Yuryakh oil fields. Now, we are also closing in on the acquisition of Vadinar refinery, which is one of the top 10 refineries in the world,'' the official added. The Indian companies will hold 29.9 per cent stake in Taas-Yuryakh oilfield in East Siberia for $1.12 billion and 23.9 per cent in the Vankor oilfield for $2.02 billion.

The Vankor deal is set to provide 6.56 million tonnes of oil equivalent (mmtoe); Taas-Yuryakh may feed 1.5 mmtoe by 2019 to the oil-starved India. He added that though no new deals are in the offing, his company will always be interested in partnering with Indian companies. 

Meanwhile, ONGC Videsh, the overseas arm of ONGC, is in talks with Russian gas giant Gazprom for construction of a pipeline to India, possibly through China. Under the plan, Russia will provide gas to China and in return, the existing pipeline between Myanmar and China will reverse its flow. ''If both China and Myanmar agree to this, we will have a connector between India and Myanmar,'' said  N K Verma, managing director of ONGC Videsh Ltd. 

Both Engineers India Ltd and Gazprom PJSC are jointly preparing a blueprint for laying a gas pipeline.

India and Russia had recently agreed to construct a $25 billion natural gas pipeline from Siberia to India.  ''Among the options like Himalayas, TAPI route and Iran route that we considered, the Chinese route appears to be the most favourable if all the countries agree to it,'' Verma added.