Oil India explores ways to get back Russian dividend

NEW DELHI: Oil India is actively seeking a method to transfer a $300 million dividend for its stake in two Russian assets that is presently blocked in Moscow, according to its chairman Ranjit Rath who addressed shareholders on Thursday. The state-owned company shares a 23.9% interest in JSC Vankorneft and a 29.9% stake in Tass Yuryakh Neftegazodobycha with state-run Oil India, Indian Oil Corp. and Bharat PetroResources.

Rath assured that "it's only a matter of time" before they find a solution to transfer the amount, which is currently held in the Moscow branch of State Bank of India. The dividend remains frozen due to Western sanctions on Russian entities and banks stemming from Moscow's invasion of Ukraine. Rath did not disclose the exact approach his company intends to pursue for retrieving the stranded money.

Additionally, Rath mentioned that Numaligarh Refinery Ltd, a subsidiary of Oil India, will inaugurate a 120,000 barrel-per-day crude unit at its factory in Assam's northeastern region by March, raising the company's total crude processing capacity to 180,000 barrels per day. Indian Oil is reportedly on the verge of finalizing an LPG import agreement with Algeria's Sonatrach for 2027, according to sources.

Rath reported that Oil India is currently constructing a 1,635-kilometre crude pipeline from Paradip port in eastern Odisha state to its refinery in Assam and expects its completion by the end of 2026. Oil India has divested from exploration projects in Gabon and Bangladesh, according to Rath. The company continues to export diesel to Bangladesh via a pipeline from its Numaligarh refinery and assures that supplies to Bangladesh remain uninterrupted, with no payment backlog.