The Hindu Business Line : ONGC Videsh in talks for buying stake in Sudan blocks

More stakes sought: The Minister for Petroleum and Natural Gas, Mr Murli Deora, the External Affairs Minister, Mr Pranab Mukherjee, and the Sudanese Minister for Energy and Mining, Mr Awad Ahmed Al-Jaz, at a conference in the Capital on Tuesday. ONGC Videsh is in talks for buying stakes in more Sudan blocks.

Our Bureau

New Delhi, Nov. 6 ONGC Videsh Ltd (OVL), the overseas investment arm of ONGC, is eyeing more exploration assets in Sudan. The company is in talks to acquire stakes in two oil blocks in the African country.

“OVL is present in three blocks in Sudan and is on the way to joining a fourth one. It is also applying for a fifth property,” the Sudan’s Energy Minister, Mr Awad Ahmed al-Jaz, said on the sidelines of the India-Africa Hydrocarbon Conference here.

OVL is seeking a 30 per cent stake from Petronas of Malaysia in Block 8 in Blue Nile Basin, northeast of prolific Melut Basin. Petronas Carigali Overseas has a 77 per cent interest in the block. The remaining equity is with Sudan’s national oil company Sudapet (15 per cent) and High Tech Group (8 per cent). “Petronas has undertaken some seismic surveys in the block, and drilling is yet to begin,” Mr R.S. Butola, Managing Director, OVL, said.

The company has also shown interest in taking the unallocated 32.5 per cent stake in Block B where French major Total is the operator. Total has 31-32 per cent stake in the block. The block also has White Nile as a partner.

OVL already has three blocks in Sudan — 5A, 5B, and 1,2,& 4. Petronas had waived off its pre-emption rights to allow OVL to buy Austrian firm OMV’s stake in Block 5A and 5B. OVL acquired OMV’s 26.125 per cent stake in exploration block 5A, and 24.5 per cent stake in Block 5B for $115 million.

Petronas Carigali Overseas Sdn Bhd (Petronas) is the operator of Block 5A, with the remaining five per cent with Sudapet.

The block is spread over an area of 20,917 sq km and consists of discovered reserves and unexplored acreages. Considerable exploratory drilling has been carried out in the block by the consortium and two fields namely Thar Jath and Mala have been put on production and cluster of discoveries around Mala are in the stage of development.

The Thar and Mala Field started production in 2006, while production from Mala satellite will commence in 2008. Block 5A, that contains the undeveloped Thar Jath field with gross proven and probable oil reserves of 149.1 million barrels, is producing 25,000 barrels per day.

In Block 5B, Petronas has 41 per cent, Sudapet 10 per cent and Swedish oil firm Lundin Petroleum AB 24.5 per cent.

The total resource of the block is estimated at 3.5 billion barrels. Block 5B is a large block and is located in the Sudd swamp.

Blocks 5A and 5B are located in the Muglad basin and are adjacent to the Greater Nile Oil Project, where OVL has 25 per cent stake, which comprises Blocks 1, 2 & 4, is currently producing 2,55,000 barrels of oil per day.

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