India’s OVL and partners withdraw from Sudan’s oil fields

September 16, 2020 (KHARTOUM) – India’s oil firm ONGC Videsh (OVL) said on Wednesday they decided together with its partners – Chinese and Malaysian oil companies – to withdraw from Sudan’s oil blocks 2a and 4 after years of negotiations with the authorities in Khartoum.

Sudanese oil workers at one of GNPOC fields in South Kordofan (file photo Asawer oil company)

In 2003, a joint venture Greater Nile Petroleum Operating Company (GNPOC) was formed between Chinese CNPC, Malaysian Petronas, Indian ONGC Videsh and Sudan’s Sudapet to develop Blocks 1, 2, and 4 of Sudan’s Muglad Basin oil fields at 800 km.

After South Sudan’s independence in July 2011, the blocks were split between the north and South Sudan.

Sudan had denied ONGC and partners an extension of license to operate block 2B after the initial contract expired in November 2016.

According to the Press Trust Of India (PTI) news agency, OVL has exited from the east African country after Sudan’s refusal to pay for oil it lifted from the fields.

“Sudan had since 2011 not paid OVL and partners for oil it bought from the block. Sudan’s dues towards OVL totalled $430.69 million,” an Indian official told PTI.

In a financial statement issued in August 2019, the Indian firm said considering withdrawal from Sudan and disclosed that it had informed the government in Khartoum of its decision on 10 May 2019, one month after the collapse of the former regime.

ONGC has been engaged in an arbitration with Sudan for more than a year to recover its oil dues that have now climbed to $500 million.

However last year Indian officials told The Economic Times newspaper that the project had already paid back the investment.

ONGC owns 25% stake of the two blocks while China’s CNPC (40%), Malaysia’s Petronas (30%) and Sudan’s Sudapet (5%).


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