ONGC is in talks to buy shale gas assets in US and Canada but the firm's Iran investments are impeding closure of the deals.

ONGC Videsh has zeroed-in on at least couple of shale gas properties in US but has not been able to close the deal due to its investment in countries that Washington has imposed economic sanctions on, sources privy to the development said.

OVL has invested in oil and gas fields in four countries high on US sanction list -- Iran, Myanmar, Syria and Sudan. Of these, its investments in Iran are the ones that is stalling closure of any shale gas deal.

Sources said the company has taken legal opinions which warn of consequences like forfeiture of its entire investment in an American or Canadian shale gas property should Washington implement its own law that calls for imposition of sanctions on any firm investing more than $20 million in Iran's petroleum or natural gas sector in any given year. OVL has since 2003 invested about $87.875 million in Farsi block in Iranian Persian Gulf and has discovered a giant Farzad-B gas field.
The field, which holds 12.5 trillion cubic feet of reserves (four times the size of reserves in Reliance Industries eastern offshore KG-D6 fields), may require up to 6 billion in producing 1,100 million standard cubic feet a day by 2016/17. OVL has so far not signed a contract committing to invest the Iranian field.
It has 25% interest in the producing Greater Nile Oil Project of Sudan which it bought for $720 million. It also has 24.125 per cent stake in the Block 5A in the African nation. The firm holds 33.33-37.5 per cent interest in four Production Sharing Contracts (PSCs) comprising 36 producing fields in Syria, and 20% interest in A-1 and A-3 gas fields of Myanmar. Sources said OVL sees huge opportunities in US shale gas — natural gas trapped in unusually non-porous rocks or shales, and wants to replicate RIL and GAIL India's recent successes.