India Funds Siberian Oil Quest With Its Cheapest Loans in Decade
- ONGC signs $1.16 billion loan to finance Russia field stake
- ‘We get much cheaper rates abroad,’ ONGC’s Srinivasan says
General view of Vankor Field on April 7, 2016 in Igarka, Russia.This oil and gas field located 130 kilometers away from Igarka in Krasnoyarsk Krai of Eastern Siberia.
Photographer: Stanislav Zalesov/Kommersant Photo via Getty ImagesAs energy consumption explodes in the world’s second-most populous nation, India’s state-owned oil companies are taking advantage of the lowest overseas loan costs in a decade to finance exploration in the wilderness of Siberia.
ONGC Videsh Ltd. signed a $1.16 billion nine-month bridge loan on May 19 to fund the purchase of a 15 percent stake in Vankor field in Siberia from Russia’s Rosneft OAO, data compiled by Bloomberg show. Indian Oil Corp. plans a $1.2 billion fundraising for Russian investments in three or four months, including short- and long-term loans, Finance Director A.K. Sharma said in an interview on Wednesday. The average margin over benchmark rates on non-rupee loans for Indian refiners and explorers was 74 basis points this year, the lowest since 2006, the data show.