Oil & Natural Gas Corporation Ltd.

State-owned Oil and Natural Gas Corporation (ONGC) is likely to acquire British energy major BG Group's stake in three of its eastern offshore oil and gas exploration blocks. The company will buy BG Group's 45% participating interest in Krishna-Godavari Basin block KG-OSN-2004/1, 25% interest in exploration block MN-DWN-2002/02 in the Mahanadi Basin and 30% stake in deep water block KG-DWN-98/4.

The company has received its board’s approval for the proposal to acquire BG Group's stake in three blocks. ONGC, which is buying BG's stake in the three blocks will not give any cash instead, it will get cash in lieu of past liabilities of the British group in the blocks. BG Group will pay about $50 million to ONGC towards settlement of past costs that the state-owned firm incurred on its behalf in the three blocks.

After the acquisition, ONGC will have a 100% stake in the block and BG is now left with just one exploration property -- the KG-DWN-2009/1 deepwater block in the KG basin -- which it won alongside ONGC and Oil India in the 8th NELP round in 2010.