The Hindu : ONGC confident of getting exploration block in Iraq

Online edition of India's National Newspaper
Tuesday, Jun 24, 2003

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ONGC confident of getting exploration block in Iraq

By Our Special Correspondent

NEW DELHI June 23. India's prospects of acquiring oil exploration acreage in Iraq remain bright despite the changed scenario in that country. The U.S. authorities in Iraq are currently ``reviewing'' contracts concluded by the Saddam Hussein Government and may end up clearing many of them.

This is the information with the ONGC Videsh Limited (OVL) chairman, Atul Chandra, who said one of the factors weighing in favour of the Indian contract was that it had been ratified by the Iraqi parliament.

OVL, a subsidiary of the Oil and Natural Gas Corporation (ONGC) is looking at a host of countries to acquire equity oil after its successful bids in Sudan and the Sakhalin region of Russia. The Iraq contract for acquiring oil exploration acreage had been concluded before the war and is likely to be considered favourably, Mr. Chandra said. He, however, denied that this had any linkage with the U.S. proposal to bring Indian troops into Iraq.

While maintaining that OVL ``is in constant touch'' on the Iraq contract, he said the U.S. is not expected to cancel any contracts.

On new vistas for oil equity abroad, he said the first well would be drilled in Myanmar next year while the contract with Libya for equity oil is being signed shortly. In the case of Iran where an agreement has been reached on exploration acreage, seismic surveys have been completed.

In the case of the Sudan oil project, he said the return on investment is current estimated at nearly 20 per cent in dollar terms while for Sakhalin, the returns are expected to be around 13 to 14 per cent. OVL has also formed a wholly owned subsidiary, ONGC Ganga Nile BV incorporated in the Netherlands to manage the Sudan property.

Its first overseas subsidiary was Sakhalin India Inc. in the U.S. for managing its operations in Sakhalin oilfield in Russia. OVL may also go for listing on the New York Stock Exchange at some time in the near future, he said.

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