India keen to buy BP’s assets in Vietnam
With BP Plc looking at selling interest in some fields to fund its the Gulf of Mexico oil spill liability,
Oil Minister Murli Deora flew into the Vietnamese Capital this morning with heads of bluechip Indian oil firms to lay a claim with
“This is a great opportunity for us. The gas fields were originally allocated to us but due to foreign exchange crisis of 1990s, we had to farm-out (give away) some stake to BP. We will like to get back that stake,” Deora said ahead of his meetings with Vietnamese Prime Minister Nguyen Tan Dung and Government-run PetroVietnam.
BP is considering selling fields in
A 370-km pipeline ships the gas produced from the fields to onshore power plants. BP has 32.33 per cent stake in the USD 565 million pipeline where its other partners are ConocoPhillips (16.7 per cent) and Petrovietnam (51 per cent).
The gas produced from the fields is supplied to a 720 MW, USD 412 million power plant where BP, NI of Japan and Semb Corp of
While OVL along with state-owned Oil India Ltd may takeover BP stake in the gas fields, gas utility GAIL India was interested in the British energy giant’s stake in the pipeline. GAIL and refiner Indian Oil Corp (IOC) can together manage the power plants. Nam Con Son project’s upstream part is the Block 06.1, located 370 km south–east of Vung Tau on the southern Vietnamese coast. The 955 sq km block has Lan Tay and Lan Do gas fields. Lan Tay currently produces around 14 million standard cubic meters per day of gas while Lan To is being developed currently.
OVL recouped all its investment in the project in 2006 and currently earns USD 35-40 million of net revenues, officials said. OVL has so far invested USD 217 million in the gas fields and has government approval to invest up to USD 377.46 million.
ONGC Chairman and Managing Director R S Sharma, OVL Managing Director R S Butola, GAIL Chairman and Managing Director B C Tripathi, OIL Chairman and Managing Director N M Borah and IOC Director (Refineries) B N Bankapur are part of the high-level delegation Deora is leading. “There are reasonable expectations that BP may exit its project in
If Nam Con Son was put on the auction block, Asian interest would be strong, especially from
Chinese oil majors could come up against political opposition in
Besides Nam Con Son, BP also owns 75.9 per cent operating interest in Block 5-2 with Petrovietnam holding 24.1 per cent. It partners ConocoPhillips and PetroVietnam in Block 5-3. OVL also has two other exploration blocks – 127 and 128 in
The gas fields in Block 06.1 were discovered in 1998 and were put on production in January 2003. The field produced an average of 12 mmscmd in 2009 and with additional compressors being put, the output will rise to 15 mmscmd.
22 July 2010