IOC readies $1-bn war chest
Indian Oil Corporation (IOC) has readied a war chest of $1 billion to acquire oil producing assets in South East Asia and African regions.business Updated: Jan 13, 2009 20:52 IST
Indian Oil Corporation (IOC) has readied a war chest of $1 billion to acquire oil producing assets in South East Asia and African regions.
The move is aimed at reducing the company's dependence on imported crude oil. Extreme volatility in international crude oil prices has a direct impact on the bottom line of the state-owned oil firm, which imports nearly 50 million tonnes of crude oil annually out of the 67 million tonnes of crude that it processes at its 10 refineries.
Confirming the move, IOC's Director (business development), BM Bansal said that with a sharp fall in crude oil prices, the premium on oil properties has also gone down. "We are evaluating a host of prospective producing assets anywhere up to $one billion."
The fall in crude oil prices by nearly 70 per cent in the last six months has improved the financial position of IOC. The company's borrowings, which had touched Bansal, however, said that volatility in crude prices has also posed another challenge. Even though blocks are available, managements are not much interested in selling mainly because of falling prices.
“They are waiting for the crude prices to recover so that properties can fetch them good premium.”