The contracts were signed on September 9, 2006 in Havana. OVL had earlier submitted Expression of Interest for these two blocks located in Cuba's deepwater offshore areas and negotiated the Production Sharing Contract. Government of Cuba has the option to take 20% participating interest in these Blocks. OVL will be the operator of the Blocks.
The Exploration period is spread over a period of six years in three phases. During the first phase of exploration - acquisition, processing and interpretation of seismic data would be carried out for identification of prospects.
Earlier, in May 2006, OVL had acquired 30% Participating Interest in six exploratory blocks in offshore Cuba from Repsol YPF who hold 40% Participating Interest and balance 30% Participating Interest is held by Norsk Hydro. Mr. R.S. Butola, Managing Director of OVL, who executed the contract on behalf of the company, said that "Cuba offers very promising exploration play and OVL is very pleased to enhance its investments in the country. Besides, execution of the Production sharing Contract for the Blocks N-34 & N-35 marks the entry of OVL in Latin America as an Operator which will give a boost to its activities in the region."
"OVL has already made its presence in Cuba's Upstream Hydrocarbon Sector through participation in six offshore blocks. This contract would give major boost to OVL's activities in the region", said Mr. R.S.Sharma, Chairman, ONGC Group of Companies.
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