The Hindu Business Line : Essar plans to invest in oil exploration sector in Vietnam

Kolkata. Oct. 3 Close on the heels of announcing its plans to invest in a steel plant in Vietnam, Essar group is now looking forward to invest in oil and gas exploration sector in the country.

According to sources, Essar Energy Holdings Ltd – the group oil and gas outfit – has recently participated in the ‘2nd international bidding round for open blocks in Song Hong Basin’, offshore northern Vietnam.

The bid was submitted for one block on a standalone basis. The sources, however, did not disclose the name of the block. When contacted Essar official sources denied comment on the issue.

Vietnam Oil & Gas Group, known as PetroVietnam, had launched the bidding round — inviting global participation in oil and gas exploration in seven offshore blocks (namely 105-110/04,111/04,114,115,116,120 and 121) — in June this year.

The blocks are located at average water depths of 60-100 metres covering 50 square km area at 50 to 100 km distance from the shoreline. According to PetroVietnam, the hydrocarbon potential of the blocks may reach five billions barrels of oil and oil equivalent.

The last date for submission of the bid was September 21. The award is expected this month.

Essar has already submitted bids for one onshore block in Syria in consortium with Gujarat State Petroleum Corporation (GSPC). The award for the same is expected shortly.

Bids are also submitted for two onshore and one shallow-water offshore block in Iran.

Myanmar unrest impact

Meanwhile, the fate of Essar’s scheduled commencement of a two-well $10-million exploratory drilling programme in the onshore block (L) in Myanmar beginning November will depend on the future course of civil unrest in the country.

“The unrest in the country has impacted Essar’s work programme for last one week,” a source said adding that they were expecting the situation to improve sooner than later.

Essar is also awarded the contiguous shallow water block (A2) in the Rakhine coast in Myanmar. The company is currently scouting for a suitable rig to commence exploratory drilling in the block before May 2008.

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