Oil & Natural Gas Corporation Ltd.

Oil and natural gas major, ONGC, will sell 26 per cent stake in its KG Basin exploration block, KG-DWN-2004/6, to Japanese oil and gas explorer Inpex Corporation. However, the transaction will materialise once government approves the deal.

Post the stake sale, ONGC would continue to be the operator of the deepwater block, KG-DWN-2004/6 with a 34 per cent participating interest in consortium with existing partners GAIL (India), which holds 10 per cent and Gujarat State Petroleum Corporation, Hindustan Petroleum Corporation and Oil too holding 10% interest each.

The deal has been structured in such a way that Inpex would pay ONGC, the amount spent on the block in the past proportionately, besides also meeting its future expenses according to its share.

The deep water block KG DWN 2004/6 was awarded to a consortium of five players with ONGC as the operator of the block with 60% participating interest in 2006 under the New Exploration Licensing Policy round VI. The production sharing contract was signed in March 2007.