Date:11/04/2006 URL: http://www.thehindubusinessline.com/2006/04/11/stories/2006041102880200.htm

Back OVL in talks with Chinese cos to bid for Colombian oil field

Our Bureau

New Delhi , April 10

Another India-China tie-up in the energy sector seems to be in the offing with ONGC Videsh Ltd (OVL), the overseas arm of ONGC, in talks with a Chinese company to make a joint bid for at least 50 per cent stake in a Colombian oil field. There is, however, speculation that OVL may tie up with another Chinese company Sinopec to make a joint bid.

Asked about the tie-up, a senior ONGC official said that it was too early to say which Chinese company it would be, though he confirmed that preliminary discussions were going on.

Indications are that senior OVL officials held discussions last week with China's national oil company for joint submission of bid for Omimex de Colombia Ltd.

Industry sources said that Scotia Waterous, hired by Omimex to select a partner, has stated that Omimex Resources would be willing to sell 100 per cent of its interest if a right price is offered.

Omimex, which is incorporated in Delaware, entered Colombia in 1994 with the acquisition of Texaco's 100 per cent interest in the Velasquez fee mineral property.

Subsequently, it bought the remainder of Texaco's Colombian assets, including 50 per cent interest, in the nearby Nare and Cocorna Association Contracts.

It produces approximately 9,450 barrels a day net of crude oil from the Velasquez property and 6,965 barrels oil from the Nare and Cocorna Association Contracts.

The company's net proved reserves are 157 million barrels.

Meanwhile, OVL has hired Gaffney Cline Associates as the technical consultant. Denton Wilde Sapte and UBS are engaged as the legal and financial consultants respectively.