New Delhi: State-run energy firms, including ONGC Videsh Ltd (OVL), Bharat Petro Resources Ltd, Indian Oil Corp. (IOC) and Oil India Ltd (OIL), are unable to access around $400 million in dividend payments stuck in Russia as Western sanctions have made it harder to transfer money out of the country, three people aware of the development said.
This stuck dividend income is on account of the Indian firms’ stakes in Russia’s CSJC Vankorneft and LLC Taas-Yuryakh.
India has leveraged its “special and privileged strategic partnership" with Russia to acquire stakes in Russian oil and gas projects. OVL, for instance, holds a 26% stake in CSJC Vankorneft, the owner of the Vankor Field and North Vankor license. An Indian consortium comprising Indian Oil Corp., OIL, and Bharat Petro Resources also holds a 23.9% stake in the same venture, with Rosneft’s affiliate RN Vankor operating the field with a 50.1% stake. In addition, a consortium of Indian Oil Corp., OIL, and Bharat Petro Resources holds a 29.9% stake in LLC Taas-Yuryakh.
OVL also owns 20% of Sakhalin-1 and acquired Imperial Energy Corp. Plc, which has 10 exploration and production blocks in the Tomsk region of western Siberia.
“We are unable to transfer the dividends. The dividend payments have been pending since the Western sanctions cut off Russian banks from the SWIFT payment system. Repatriation is a problem, and it has been adding up. We are trying to find a solution and are confident that it will be resolved. That money will come," one of the three people cited above said, requesting anonymity.
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