India finally got a foothold in the ongoing rush for hydrocarbons in Central Asia with the signing of a clutch of agreements during Prime Minister Manmohan Singh's maiden visit to Kazakhstan. A package of three agreements signed between the national companies of both countries will give India access to the North Caspian Sea region which is in close proximity to major discoveries. The block contains two prospective structures — Satpayev and Satpayev Vostochni (East) — with estimated hydrocarbon reserves of 256 million tonnes.
The agreements will enable ONGC Videsh (OVL) to acquire 25 per cent equity from Kazmunaigas (KMG), define how OVL will pay KMG, repayment in case of commercial discovery and development of the discovered fields. Although OVL has been trying to gain a foothold in Kazakhstan for over 15 years, the efforts got a boost only with the inking of an MoU in 2005. Secretary (East) in the Ministry of External Affairs Sanjay Singh said the move would add to India's efforts to diversify its sourcing of oil. It imports 67 per cent of oil from the Middle East and North Africa.
