ONGC Videsh Limited (OVL) is looking to invest around $1 billion in a Brazilian offshore hydrocarbon block to raise its stake, as per a report.

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Brazil’s state-run Petrobras holds a 75 percent stake in the BM Seal-4 block, with OVL holding the rest. The block lies in a 320 sq. km area in the Sergipe Alagoas Offshore Basin. The gas was discovered here in 2019, and the companies are expected to start production after 2026.

This investment follows the declaration of commerciality (DoC) for the BM Seal-4 block, with the final investment decision (FID) to be taken shortly.

The news comes at a time when India has been trying to secure LNG globally after a contract with GAIL was reneged on by Gazprom’s former subsidiary, Gazprom Marketing and Trading Singapore. India has reached out to several countries, including the US, Iraq, UAE, Saudi Arabia.

India’s natural gas consumption is increasing, with the country consuming 163.06 million standard cu. m per day (mscmd) in FY22. The South-Asian nation imports 85 percent of its oil and 55 percent of its natural gas.

This comes against the backdrop of a growing energy partnership between India and Brazil as the former tries to diversify its energy supplies and access equity oil and gas. India is also looking to firm up partnerships with other Latin American countries. Recently, the Indian Oil Corporation (IOC) signed a long-term contract to procure crude oil from Colombia’s state-run Ecopetrol SA.

-With input from agencies

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First Published:Oct 6, 2022 10:50 AM IST