OIL looks at ways to bring home $150 mln payout from Russia, ET EnergyWorld

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State-run Oil India is exploring legal as well as diplomatic channels to repatriate its dividends worth $150 million from Russia, said its chairman, Ranjit Rath.

Oil India, Indian Oil Corporation, BPCL and ONGC have participating interests in multiple oil and gas projects in Russia from which they earn dividends periodically.

Companies have been receiving dividends but have been unable to transfer them out of Russia since February 2022 due to the banking restrictions in the wake of the Ukraine war and the western sanctions on Moscow.

Indian Oil and BPCL have similar amounts of dividends stuck in Russia, totalling $450 million for the three companies, Rath said.

This is a “temporary phenomenon” and the company is “very positive about investments in Russia”, he said, adding that the company is exploring legal, banking and government-to-government options to get the dividends back.

The production at Russian fields in which Oil India has stakes hasn’t been affected by the output cut decisions made by the producer cartel OPEC+ of which Russia is a key member, Rath said.

Oil India will primarily focus on domestic exploration and production, said its chairman. Rising oil prices won’t change the company’s investment trajectory, he said.

A windfall tax since last year has capped the crude price realisation for Indian state-run producers. Crude oil is currently trading above $92 per barrel.

Oil India is planning to invest ₹25,000 crore to reach its net zero goal by 2040. Of this, ₹8,000 crore would go into setting up second-generation ethanol plants. The company is targeting to significantly cut its gas flaring to reduce its carbon footprint. It plans to lay a new pipeline and set up compressors in isolated fields to transfer currently unused gas to customers.

  • Published On Sep 15, 2023 at 08:05 AM IST

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