ONGC to finalize India's biggest overseas investment
Wednesday, 30 October 2002, 20:30 IST
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NEW DELHI: A high-level oil delegation will visit Sudan next week to finalize details of India's biggest overseas investment in a highly promising oil consortium. The visit of the team of ONGC Videsh Ltd, the overseas arm of oil exploration major Oil and Natural Gas Corporation (ONGC), is a follow-up of the cabinet's June decision to acquire a 25 percent stake in the Greater Nile Petroleum Operating Company, held by Canadian firm Talisman, in a $750 million deal. New Delhi and Sudan last week signed two agreements on promotion and protection of investments and avoidance of double taxation to facilitate Indian investment. India-Sudan ties in other areas have also been growing, evidenced by the visit of an eight-member cultural group to this country and the inauguration of the India-Sudan Cultural Forum Sunday. Concerns had been expressed in some quarters about the feasibility of the investment because of the security situation in the north African nation, which has been wracked by a bitter insurgency. But the decision by Khartoum and rebels of the Sudan People's Liberation Army to hold talks have improved the prospects of peace. Official sources said ONGC Videsh managing director Atul Chandra would head the Indian delegation for talks with Sudanese officials. Oil industry sources said New Delhi's attempt to secure oil equity in Sudan could prove to be a good deal despite security concerns. Sudanese Ambassador Abdalmahmood Abdalhaleem Mohammad said these concerns were unwarranted as Khartoum was party to all major investment guarantees. "The signing of the bilateral agreement for promotion and protection of investment should remove any remaining concerns," Mohammad said. Sudan is estimated to have one of the largest oil reserves in the world, and it could prove to be a major source for energy-starved India, which depends on imports for 70 percent of its requirements. Besides Talisman's 25 percent stake in the Greater Nile Petroleum Operating Co., China National Petroleum Corporation holds 40 percent, Malaysia's Petronas 30 percent and Sudan's Sudapet the remaining five percent in the 230,000 barrels- a-day project. The project has a current production of 12 million tones annually, equal to that of India's biggest offshore oilfield in Bombay High. India's share in the production would be three million tones per annum. As a further protection measure, India is taking a risk cover from World Bank affiliated Multilateral Investment Guarantee Agency (MIGA). Sudan is also keen on India bidding for oil concessions among several blocks being offered for exploration and production along the Red Sea coast and the northwest region, which, according to the envoy, is "one of the most secure areas". "In fact, we are looking at Indian companies stepping up investment in all areas, particularly independent power production and setting up refineries," he said.
Source: IANS
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