ONGC Videsh Ltd (OVL), which has two offshore blocks in South China Sea allotted by Vietnam, does not perceive any threat to production after The Hague ruling, an OVL director told Mint, an Indian daily business newspaper, on condition of anonymity.
The output from these blocks goes to Vietnam for domestic consumption and not exports that require tanker movement in the contested waters, he added.
OVL, which is the overseas arm of India’s state-owned explorer Oil and Natural Gas Corp. Ltd., holds a 45% stake in block 6.1 about 375 kilometers off the Vietnam coast, in which Rosneft
Vietnam B.V. holds 35% and Vietnam Oil and Gas Group (PetroVietnam
There are also two gas condensate fields at the block - Lan Tay and Lan Do - which are pumping gas since 2002, according to a background on the fields made available by Rosneft.
OVL has completed the first phase of exploration in Block 128 that it fully owns, off the Vietnam coast.
“We will keep assessing further opportunities that come up from time to time,” the director cited above said.
Vietnam accounted for nearly a quarter of OVL’s total hydrocarbon output of 5.5 million tons of oil and 3.3 billion cubic meters of gas in 2014-2015.
The Permanent Court of Arbitration on July 12 ruled that China’s claims over most of the South China Sea have no legal basis.
In the past, China has objected to India’s hydrocarbon exploration projects in the South China Sea, off the coast of Vietnam, asserting its sovereignty over the area covering the two blocks.
However, OVL continued exploration after Vietnam reaffirmed its sovereign rights.
New Delhi has repeatedly asserted that OVL’s participation in Vietnamese exploration projects is purely commercial.
“There is no question of big tankers coming in and going out of the two blocks which we have been holding for a long time. Secondly, the tribunal’s verdict says that China is in violation of international law. If there is any flare-up in the region, the international community will view it seriously,” the OVL director quoted above said.