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India acquires stake in Sudan oil field
Friday, 14 March 2003, 20:30 IST
NEW DELHI: India has acquired a 25 percent stake in an oil field in Sudan in a move towards energy security, Petroleum Minister Ram Naik said Thursday.
"The first ever acquisition of a large oil-producing field by India overseas at a sale price of $720 million is a path-breaking step towards oil security of the country," said Naik at a press conference to announce the acquisition of 25 percent stake in Greater Nile Oil Project in Sudan.
India bought the stake from Canada's Talisman Energy.
As the sale price had been frozen at $720 million on August 31, 2002, one-fourth share of the oil produced from the field had been accruing in the account of ONGC Videsh Ltd (OVL), the overseas arm of the exploration major, Oil and Natural Gas Corporation (ONGC), since September 1.
After accounting for the interest on the sale price, as the payment had been made six-and-a-half months later it was adjusted against the high realisation of OVL's oil share from the field.
"India had to pay only about $670 million as the final price against the cabinet approved purchase price of up to $750 million," said Naik.
India's share of three million tonnes of crude from the Sudanese field is about 10 percent of the country's domestic production.
In the last few months, two more commercial discoveries have been made in the Greater Nile Oil Project, which consists of four blocks in the Muglad Basin and a 1,500 km pipeline from the oil fields to a Sudanese port on the Red Sea.
The project at present produces 12 million tonnes of oil annually, which is, 240,000 barrels a day.
The gross revenue earned by Talisman from this project in 2002 was about $500 million, which is about two times what OVL had estimated. The rise was because of the high price of the Sudanese sweet crude which is sold at about $30 a barrel.
"With war clouds over the Gulf, the acquisition of oil equity of such a significant quantity assumes great importance as the Indian share of crude oil from the field is readily available for supply to the country," said Naik.
Dependent on import for 70 percent of its annual domestic requirement, India has been scouting with some success to get oil equity in countries like Russia, Myanmar, Iraq, Syria, Libya and Vietnam.
Naik said India is keen to acquire more equity in other Sudanese oil fields.
In the Greater Nile Oil Project, OVL's partners are the Chinese National Petroleum Company (CNPC) with 40 percent stake, the Malaysian National Oil Company Petronas with 30 percent and the Sudan National Oil Company with five percent respectively.
Source: IANS
Source: IANS