India's OVL Sees no Threat to Operations in South China Sea Despite Recent Tensions

ONGC Videsh (OVL), the overseas arm of ONGC, sees no threat to its production in South China Sea despite recent tensions in the region, Livemint, a business daily, reported Monday.

He Indian company has two offshore blocks in South China Sea allotted by Vietnam. The output from these blocks goes to Vietnam for domestic consumption and not exports that require tanker movement in the contested waters, a company official told the newspaper.

Vietnam accounted for nearly a quarter of OVL’s total hydrocarbon output of 5.5 million tonne (mt) of oil and 3.3 billion cubic meters (bcm) of gas in 2014-15.

Tensions mounted after China rejected a 12 July ruling of the Permanent Court of Arbitration in The Hague, which said that Beijing’s claims over most of the South China Sea have no legal basis.

China also said that it would set up an air defence identification zone in the region.

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, Livemint reported.

However, ONGC Videsh continued exploration after Vietnam reaffirmed its sovereign rights.