GAIL in talks to buy $500 mn E&P company

GAIL India is scouting to acquire a mid-sized oil exploration and production (E&P) company worth $500 million, and is in talks with three companies for the purpose.

The acquisition is aimed at gaining expertise in areas like reservoir engineering and geophysics, and is in talks with three companies for the purpose.

The acquisition is aimed at gaining expertise in areas like reservoir engineering and geophysics, an area where GAIL lacks expertise.

As part of the development, GAIL executives are in discussions with companies based in Oman, Malaysia, Australia, Qatar and Abu Dhabi. However, nothing has been finalised yet.

"We are evaluating the skill and expertise of the companies in E&P, as GAIL is novice in this segment. After the acquisition, the entity will spearhead GAIL's exploration activities worldwide," GAIL chairman and managing director Prashanto Banerjee told reporters here.

However, he has declined to divulge any details of the companies.

GAIL has participation interest in 12 exploration blocks, but is yet to begin work. The company has planned to use its cash surplus to fund the acquisition. The is bidding for oil and gas blocks in Australia, which will be decided in January.