The oil block is situated in the South China Sea’s disputed waters. Credit: Keri Jackson/Pixabay.

Indian oil and gas company ONGC Videsh has secured a three-year extension from Vietnamese authorities for the exploration of ‘Block 128’.

The oil block is situated in the South China Sea’s disputed waters.

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This is the eighth extension for ONGC Videsh, which is the overseas arm of Indian government-backed Oil and Natural Gas Corporation (ONGC).

In a post on X, formerly Twitter, ONGC announced, ONGC Videsh “secures extension of 3 more years to explore in South China Sea’s Block 128! India’s strategic commitment stays strong as ONGC Videsh continues its exploration journey with its 8th extension till 15 June 2026. We are embracing challenges, safeguarding interests & fostering partnerships.”

In May 2006, PetroVietnam, the state oil corporation of Vietnam, and ONGC Videsh agreed to a production sharing contract (PSC) for Block 128 offshore Phu Khanh Basin.

ONGC Videsh is yet to find commercially viable amount of oil and gas reserves in the block.

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However, the energy company continues to operate there due to India’s strategic interest in the South China Sea, according to the Economic Times.

As the operator, ONGC Videsh has a 100% stake in the block, which covers an area of 7,058km² with water depths ranging between 200 metres (m) and 2,000m.

ONGC’s unit entered Vietnam as early as 1988 when it secured exploration licence for Block 06.1.

In the 2022–23 fiscal year, ONGC Videsh produced 0.693 million tonne of condensate and oil equivalent gas from Block 06.1, which it owns a 45% stake in.

The Vietnam government has extended the Block 06.1 PSC for another 16 years, which was originally scheduled to expire on 18 May 2023.