State-owned Oil and Natural Gas Corp (ONGC) is in talks to buy Videocon’s 10% stake in a giant gas field off Mozambique.
ONGC Videsh Ltd, the global arm of ONGC along with sister public sector company Oil India Ltd (OIL) are together negotiating for the stake for which Videocon is reportedly seeking at least $3 billion, sources privy to the development said.
While ONGC and OIL sources officials confirmed that talks were going on with Videocon and they were currently conducted a due diligence, ONGC chairman Sudhir
Vasudeva refused to comment. Videocon chairman VN Dhoot also refused comments.
Sources said that OVL-OIL find Videocon’s asking price too high and are in the process of doing a due diligence. ONGC is taking OIL along for acquisition of
Videocon’s 10% stake in Offshore Area 1 in Rovuma basin field and feels OIL alone will not be able to buy the stake.
Bharat Petroleum Corp Ltd (BPCL) also holds 10% stake in the block, which may hold as much as 70 trillion cubic feet of gas reserves.
Global energy giants like Royal Dutch Shell, BP Plc, ExxonMobil, Spain’s Repsol and China’s Sinopec also have found Videocon’s asking price too high.
US energy major Anadarko is the operator of the Offshore Area 1 Block with a 36.5% interest while Mitsui E&P Mozambique Area 1 has 20%. PTT Exploration & Production Plc has 8.5% and the balance 15% is with Mozambique’s ENH.