December 06, 2007

ONGC Videsh, Hindujas to Jointly Tap Oil, Gas in Iran




TEHRAN (Fars News Agency)- Hungry for acquiring more oil and gas assets abroad, India's ONGC Videsh Ltd (OVL) is set to ink an understanding with the Hinduja Group for jointly exploring the possibilities of acquiring acreages overseas.



The board of OVL, the overseas investment arm of ONGC, on Wednesday approved signing of a memorandum of understanding with the Hindujas for jointly acquiring assets abroad, particularly tapping opportunities in Iran sources told Business Line.

Sources, however, declined to comment on whether OVL would be opting for a joint venture company or take the special purpose vehicle route (SPV) with the Hindujas for opportunities in Iran. "The board has cleared the signing of an MoU with Hindujas for Iran. Now we will talk to the Iranian authorities on the projects. Based on the opportunities we will form a project specific joint venture or a SPV," he said.

ONGC and the Hinduja Group are interested in jointly developing Iranian assets. It will be a collaborative approach to explore possibilities of developing two fields in that country, sources said.

Indications are that the two were exploring joint opportunities in Iran's onshore Azadegan oil field and the South Pars Phase 12 gas asset. The equity structure and investment decision will be finalized once stake is bought in the two blocks.

As per reports, OVL and the Hindujas were in talks to form a partnership with a subsidiary of National Iranian Oil Company for a presence in the two fields. Indian and Chinese companies have been showing keen interest in acquiring oil and gas assets abroad.

Azadegan oil field is one of the biggest oil fields to be discovered in the world during the past 30 years and its reserves have been estimated at 33 billion barrels. The South Pars gas field contains about 50 per cent of Iran's gas resources and is regarded as the largest offshore gas field in the world.

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