Financial Daily from THE HINDU group of publications
Saturday, Dec 18, 2004

Cross Currency

Group Sites

Corporate - New Projects
Industry & Economy - Petroleum

ONGC approaches bankers to raise $ 600 m for Sudan project

Archana Chaudhary

Mumbai , Dec. 17

OIL and Natural Gas Corporation has approached Indian and foreign bankers to raise $600 million for financing a refinery expansion project in Sudan, which was awarded to its subsidiary, ONGC Videsh Ltd.

The company has asked banks to help raise a "non-recourse" debt to revamp and expand a three million-tonne refinery in Sudan and lay a 740 km pipeline, a senior company official said. A non-recourse debt would mean that in case of default, lenders would have to recover money from the asset itself and OVL would be directly responsible.

This is one the first major borrowings for ONGC, which had become a debt-free company since 2002-03. Mr Subir Raha, Chairman and Managing Director, ONGC, and senior officials of ONGC and OVL, including Mr R.S. Sharma, Director (Finance) and Dr C.M. Lamba, President (Projects) among others met representatives of 20-odd banks and lending institutions on December 10.

The total value of the expansion and pipeline project is $1.2 billion. Of this, OVL will bring in $600 million while a consortium of lenders will bring in the other half.

"The Cabinet had approved a budget of $1 billion for ONGC investments in Sudan. Since ONGC has already invested roughly half that sum in the Greater Nile project, it cannot bring in the entire investments needed for this expansion and pipeline project on its own," the official said.

VL's first project in Sudan was the Greater Nile Oil Project, joint venture with China National Petroleum, Malaysian company Petronas Carigali and Sudan National Oil Company, located at the Muglad basin. It is estimated to have a reserve of more than one billion barrels spread over 10 fields.

The Port Sudan refinery expansion and pipeline project is the second project that it won late last year. The pipeline, from Khartoum refinery to the Port of Sudan, was estimated to cost $200-300 million. The refinery revamp and expansion from 34,000 barrel a day to 71,000 barrels a day was valued at $400-500 million.

More Stories on : New Projects | Petroleum

Article E-Mail :: Comment :: Syndication :: Printer Friendly Page

Stories in this Section
Ashok Leyland sets up logistics company

BHEL declares 35% interim
Ranbaxy gets tentative US FDA nod for seizure drug
SEBI plans changes in calculation of preferential issue pricing
Devaki Hospitals ropes in two new investors
Ambani battle may enter the bourses
Zee-Turner snaps signals to Asianet
Tata Chem board nod to raise $ 150 m
Tamil Nadu Newsprint bags ICSI award
TPM award for TVS Motor
Award for Synergies-Dooray
HC remits back Glaxo patent issue
Who will say cheers to Mallya on Monday?
Nirma to take over Core Healthcare
NPIL to acquire Rhodia's inhalation anaesthetics biz
NatSteel shareholders okay sale
Bay-Forge to inaugurate ring rolling mill
Emami Paper firms up Rs 300-cr expansion
ONGC approaches bankers to raise $ 600 m for Sudan project
Bonfiglioli Transmissions plans to expand capacity
Santi Arts plans Rs 5-cr unit to hike production
Mayar to open facility in Himachal
Finolex pact over electricians
Grandix ties up with UK, US firms
BPCL conducts medical camps for auto drivers
New President - Finance for Lupin
Tata Motors ED wins CFO award

The Hindu Group: Home | About Us | Copyright | Archives | Contacts | Subscription
Group Sites: The Hindu | Business Line | Sportstar | Frontline | The Hindu eBooks | The Hindu Images | Home |

Copyright 2004, The Hindu Business Line. Republication or redissemination of the contents of this screen are expressly prohibited without the written consent of The Hindu Business Line