In its fourth deal in one year, ONGC Videsh Ltd, the overseas arm of state-run Oil and Natural Gas Corp (ONGC), on Monday said it will pay $2.64 billion to buy a ten per cent stake in a giant Mozambique gas field from Anadarko Petroleum Corp of US.

With this, OVL has snapped up deals worth over $11 billion since September last year as it works to tackle the rising energy needs of the country with takeovers abroad.

OVL in a statement said it has signed agreements to buy a ten per cent stake from Anadarko in Mozambique’s offshore Rovuma Area 1, whose up to 65 trillion cubic feet of gas reserves are to be converted into LNG for transportation by ships to markets like India.

The company, along with Oil India (OIL), had in June bought a ten per cent stake in the same block from Videocon Group for $2.475 billion. The June deal has already been approved by the Mozambique government and other partners in the block, but it is awaiting clearance of the Indian government.

A unit of state-owned Bharat Petroleum Corp Ltd (BPCL) already has a ten per cent interest in the Rovuma Area 1 and after Monday’s deal, Indian firms will have access to 30 per cent of 60-80 million standard cubic meters per day of planned gas production from the block.

OVL Managing Director D. K. Sarraf, who is credited with turning the company into an aggressive overseas player, said the two Mozambique deals will be funded through a 'mixture of internal resources and external resources including overseas borrowings.'

'What will be the mix is a strategic decision which we will take at relevant times,' he told PTI.

The Area 1 LNG project is strategically located to supply LNG to India at a competitive price, the OVL statement said.

'As a result of both transactions, OVL will own a significant interest in this strategic project in Mozambique,' ONGC Chairman and Managing Director and OVL Chairman Sudhir Vasudeva said. 'Area 1 has potential to become one of the world’s largest LNG projects and today’s acquisition marks a further significant step by OVL/ONGC group towards the energy security of our country.'

Woodlands, a Texas-based energy-exploration company, will continue to be the operator of the block, with its stake reduced to 26.5 per cent from 36.5 per cent after the deal.

The Area 1 partners as well as Italian oil company Eni SpA, which operates an adjacent field, will jointly develop what will be the world’s biggest LNG project with deliveries beginning in 2018.

The project with the capacity to produce 20 million tons of liquefied natural gas (LNG) annually would be the world’s largest LNG export site after ExxonMobil-run Ras Laffan in Qatar.

OVL, which since inception had invested $17 billion in 32 assets in 15 countries till 2011, has struck over $11 billion worth deals in the past one year.

The company had in September completed the acquisition of Hess Corp’s 2.7 per cent stake in Azerbaijan’s largest oil field and an associated pipeline for $1 billion.

Last November, it announced a $5 billion purchase of ConocoPhillips’s 8.4 per cent stake in Kazakhstan’s Kashagan project, touted as the biggest oil-find since the 1960s when it was discovered in 2000.

The bid was, however, blocked by the Kazaksthan government that wants the stake to go to China.

OVL has also acquired two blocks each in Columbia and Bangladesh and is mulling exercising its pre-emption rights to block China’s Sinochem Group from buying 35 per cent interest in Brazilian oilfields for $1.54 billion.

OVL holds 15 per cent stake in the block BC-10, known as Parque das Conchas, where Brazilian state-controlled oil firm Petroleo Brasileiro SA or Petrobras is selling its 35 per cent stake to Sinopec.

'The acquisition of an interest in Area 1 would mark OVL’s entry into this emerging world-class offshore gas basin with significant future upside potential, and is consistent with OVL’s quest of adding high quality international assets to its existing E&P portfolio,' the company statement said.

The acquisition would increase OVL’s reserve and resource base significantly. The project would also be an important milestone in reaching its long-term production targets of 20 million tons of oil and oil equivalent gas by FY’18 and 60 million tons by FY’30 from 8 million tons now.

Other partners in Area 1 include Mitsui with 20 per cent stake, ENH (15 per cent) and PTTEP (8.5 per cent).

East Africa is being eyed by energy companies after it emerged as the world’s most promising hydrocarbon area in the wake of large natural-gas discoveries off the coasts of Mozambique, Tanzania and Kenya.

Earlier, Royal Dutch Shell was said to be in talks to buy the Anadarko stake but apparently pulled out because it considered the asking price too high.

The price being paid by OVL suggests that Anadarko’s full stake, prior to the sale, was worth more than $9.6 billion, Anadarko said in a statement.

Bank of America Merrill Lynch advised OVL on the transaction while Simmons & Simmons was its legal adviser.

Ernst & Young was its tax and accounting adviser and Robertson (UK) Limited — a CGG company — served as technical adviser to OVL.