As per the MoU, Rosneft and ONGC would jointly study the possibilities for mutual projects in exploration, production and marketing as well as other projects related to the hydrocarbon industry, including joint bidding for oil and gas stakes in Russia, India and third countries. The two companies also agreed to jointly explore the options for participation in refining and retail marketing projects in India, including integration of other companies in India.
To implement this MoU, Rosneft and ONGC will establish two Joint Study Groups, one of which will be responsible for upstream and the other one for downstream. Upon jointly identifying a project, the parties shall mutually decide on the structure of the Joint Venture to implement the identified project.
ONGC, will conduct the activities under this MoU in Russia and third countries through ONGC Videsh Limited (OVL), its wholly owned subsidiary.
ONGC is the national oil company of India, with a market capitalization of $43 billion, making it the biggest company in India while Rosneft is a Russian state-owned company with a market capitalization of approximately $100 billion.
OVL is the nodal agency identified by the Government of India for acquisition of oil and gas assets outside India and is currently engaged in 15 countries with 25 projects and 40 blocks.
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