The Hindu Business Line : KG basin: GSPC final bids for stake dilution by Nov likely

Stake moves
GSPC plans to dilute 20-30 per cent stake in the block to a strategic foreign partner.
The company is hopeful of awarding the stake to the chosen partner once the new government is in place after elections in December.

Pratim Ranjan Bose

Kolkata, Oct. 2 GSPC (Gujarat State Petroleum Corporation) may invite the final bids for dilution of 20-30 per cent stake, towards a strategic foreign partner, in its KG basin offshore gas find, latest by mid-November.

As the State is expected to go to polls in the first week of December, the company is hopeful of awarding the stake to the chosen partner once the new government is in place.

At a board meet on September 29, the company decided to invite all eight foreign E&P companies, who had expressed initial interest in picking up stake in the GSPC operated KG-OSN-2001/3 block, for a pre-bid conference in London between October 10 and 12.

According to sources, depending upon the outcome of the pre-bid conference the company will set the schedule for submission of the final bids. The companies which are expected to take part in the conference are: British Petroleum, BG Group, Chevron, Exxon Mobil, Repsol YPF of Spain, France’s Total, Husky Energy Inc of Canada and Statoil of Norway.

It may be mentioned that GSPC was planning to invite the final bids by October, well before the model code of conduct comes into force in November. The term for the present Assembly in Gujarat ends on December 26.

Data access

However, according to sources, the foreign E&P companies are still accessing the GSPC data room and are yet to complete the techno-economic study of the KG block.

Accordingly, it might be difficult for the interested parties to submit bids by October.

“Once they (foreign E&P companies) complete techno-economic evaluation of the find, they may have to go back to their respective boards for securing the guidelines to participate in the final bidding process. Accordingly, we have to adhere to the prospective participants before finalising the schedule for submission of bids,” a GSPC official said.

“We are planning to invite the final bids latest by mid-November and wrap up the entire process of selecting the partner as soon as the new government is in place, hopefully by end-December,” he added.

GSPC, at present, holds 80 per cent operating interest in the KG block. Geoglobal (and its associates) holds the remaining 20 per cent participatory interest.