Essar Oil seeks to raise $2 billion | business | Hindustan Times
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Essar Oil seeks to raise $2 billion

The amount will fund its activities, including expansion of existing refining capacity and hydrocarbons exploration and production.

business Updated: Jan 30, 2008 13:06 IST

The Ruias promoted Essar Oil will soon seek an approval of shareholders to raise $2 billion to fund its activities, including expansion of existing refining capacity and hydrocarbons exploration and production.

The funds are proposed to be raised by way of a combination of options - fully convertible debentures, American depository shares, global depository receipts and public offering in domestic or international markets, the company said.

"The board has decided to seek approval of shareholders for passing enabling resolution for issue of further securities for an amount not exceeding $2 billion," an Essar statement said on Wednesday.

An extraordinary general meeting will be held on February 28.

The company will also consolidate exploration and production activities under a subsidiary, Essar Exploration and Production, to build a fully integrated oil company having upstream, refining and downstream marketing activities.

"On completion of this exercise, Essar Oil will have nine oil, gas and coal bed methane blocks," the company said, adding these include three onshore blocks in Madagascar and one offshore block in Nigeria.

The company has also won an oil and gas block at Mehsana in Gujarat, a coal bed methane block in Raniganj in West Bengal, and an offshore field and two onshore blocks in Assam.

Essar said it has also commissioned all the processing units of its 10.5 million metric tonnes per annum refinery and that all the units were expected to reach full capacity by the end of the current quarter.