ONGC Videsh Ltd plans to raise about $ 1 billion through dollar bonds issue early next year. This is to fund OVL buy of Hess stake oil fields in Azerbaijan for $1 billion.

Sources said Citibank, RBS and Deutsche Bank will be the joint lead managers.

The overseas arm of ONGC, OVL plans to come out with the bond issue in the first quarter of 2013.

Most of OVL’s earlier funding has been through its parent ONGC. One of the reasons for raising fund overseas is because dollar debt is cheaper than rupee, sources said.

On September 8, OVL had announced that it has signed definitive agreements for acquisition of Hess Corporation’s 2.72 per cent participating interest in oil fields (Azeri, Chirag and Guneshli) in the Azerbaijan part of the Caspian Sea, and 2.36 per cent interest in the Baku-Tbilisi-Ceyhan Pipeline (BTC) for $1 billion.

The acquisition would mark OVL’s entry into oil rich Azerbaijan. “The acquisition is subject to relevant Government and regulatory approvals and is expected to close by the first quarter of 2013,” OVL had said in a statement.

(This article was published on November 21, 2012)
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