The Hindu Business Line : ONGC Mittal venture eyes assets in Africa, Turkmenistan

Joint hunt
Further details on the assets narrowed down for exploration and production activities are not available.
Discussions were also held on business aspects of ONGC-Mittal Energy Services Ltd.

New Delhi March 28

The ONGC-Mittal Group joint venture, ONGC Mittal Energy Ltd (OMEL), has zeroed in on two-three large transactions in its hunt for oil and gas assets abroad.

The joint venture, which has been attracting attention due to its high-profile promoters, had deliberated on issues like the Kazakhstan and Nigerian assets and also specific exploration assets in Africa, Turkmenistan and Azerbaijan.

The promoters also held discussions on the business aspects of ONGC-Mittal Energy Services Ltd (OMESL), the other joint venture set up to provide trading, shipping and terminal services.

Specific Discussions

Sources told Business Line that last weekend, there were meetings between Mr R.S. Sharma, Chairman and Managing Director, ONGC, and Mr L.N. Mittal, Chief of LN Mittal Group, to discuss the broader areas of interest for the two joint ventures.

At a subsequent meeting of Mr Mittal with Mr R.S. Butola, Managing Director, ONGC Videsh Ltd (OVL), specific discussions on oil and gas assets were held.

Citing commercial reasons, sources declined to give further details on the assets narrowed down for exploration and production activities. "The main focus would be Africa and the two CIS countries where we have identified assets," sources said.

Exploration Block

OMEL has been awarded two prosperous blocks in Nigeria-OPL-279 and OPL-285. At the meeting, plans for the development of the Nigerian asset were discussed, sources said, adding that OMEL was also looking at another prosperous exploration block in that country.

It is also reported to be in an advanced stage of signing a farm-out agreement in respect of an exploration block in Turkmenistan. OVL's subsidiary, ONGC Nile Ganga B.V. had acquired interest in a producing property in Syria along with China National Petroleum Corporation, a part of which is held by OMEL.

As regards the Kazakh assets, source said, that OVL has roped in Mittal Group for buying stake in Satpayev block in Kazakhstan, instead of going it alone. Kazakhstan's national oil and gas company KazMunaiGaz owns Satpayev block. Kazakhstan has proven oil reserves of 13.8 billion barrels and 68.5 trillion cubic feet of natural gas.

On the prospects of OMESL, the joint venture for oil and gas trading, sources said that the mandate of the joint venture was to trade oil and gas sourced by OMEL. However, OMESL has been participating in the tenders floated by MRPL, a subsidiary of ONGC.

Related Stories:
Ventures with Mittal on, says ONGC

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