Date:08/07/2006 URL: http://www.thehindubusinessline.com/2006/07/08/stories/2006070803480900.htm

ONGC-Mittal combine eyeing properties in 21 countries

Our Bureau

ONGC willing to spend $25 billion on overseas acquisitions

THE CHAIRMAN and CEO of Mittal Steel and Director of ONGC Mittal Energy Ltd, Mr L.N. Mittal, along with his son, Mr Aditya Mittal (extreme left), the Secretary, Ministry of Petroleum and Natural Gas, Mr M.S. Srinivasan (3rd from left), and the ONGC Chairman, Mr R.S. Sharma, at a press conference in the Capital on Friday. — Kamal Narang

New Delhi , July 7

The ONGC-Mittal combine is looking at buying oil and gas properties in 21 countries, steel baron, Mr L.N. Mittal, has said.

Addressing mediapersons in a joint press conference with the ONGC Chairman and Managing Director, Mr R.S. Sharma, Mr Mittal said the joint venture ONGC Mittal Energy Ltd (OMEL) would seek investment opportunities in 21 countries. The venture will restrict its investments to exploration and would not go into refining, he said.

OMEL is a joint venture between OVL and Mittal Investments Sarl where the two jointly hold 98 per cent of the equity and two per cent is with SBI Caps. The distribution of equity between Mittal and OVL is in the proportion of 49 per cent (Mittal) and 51 per cent (OVL). OMEL is registered in Cyprus.

`Various projects'

Asked about losing Petro Kazakhstan recently, he said, "Losing Petro Kazakhstan is not the end of world. We are working on various overseas projects that I cannot disclose."

On participation in the sixth round of New Exploration Licensing Policy (NELP) of India, Mr Mittal said, "We will discuss with our partners whether we can participate in oil and gas business in India."

Mr Mittal also held discussions with top ONGC officials to draw business plans for OMEL. The Mittal and ONGC venture is seeking investments in Kazakhstan, Sudan and Nigeria, ONCG Chairman, Mr R.S. Sharma, said. ONGC is willing to spend as much as $25 billion on overseas acquisitions over the next five to 10 years, he said.

Nigerian investments

OMEL would invest more than $6 billion in setting up a refinery, power plant and railway lines in Nigeria. OMEL is finalising the investment proposals for setting up a 15 million tonnes per annum export-oriented refinery, a 2,000 MW power plant and railway lines in the African country. These investments are part of an understanding between ONGC and the Nigerian Government, wherein OMEL would create the infrastructure and the African country would give them oil blocks.

The joint venture has recently won two lucrative oil fields in Nigeria. OMEL had won Blocks OPL 209 and OPL 212 in the Nigeria 2006 mini bid round. The recoverable reserves potential estimated from a few clearly delineated prospects in the blocks are expected to be over one billion barrels of oil and oil equivalent gas.