Government-owned Oil India Ltd (OIL) is eyeing acquisition of overseas assets along with Indian Oil Corporation (IOC) for expanding operations outside India.
"We are in talks with three-four companies to buy producing assets abroad," OIL Executive Director (Corporate Affairs) Narendra Bhalla said on the sidelines of a conference on the company's forthcoming initial public offering (IPO). OIL has cash reserves of nearly Rs 6,500 crore.
"In all our eight overseas blocks, IOC is our partner. So if we go for downstream acquisition, they are going to be our partner," said Bhalla. The company plans to come out with an IPO worth Rs 2,800 crore for "pure exploration purpose, including seismic data acquisition and integration".
In addition, the company will start drilling its first well in its Libyan block by October, which will involve an investment of about $11 million, Bhalla said. All the four wells in Libya would be drilled by 2010-11, he added.
OIL was awarded Area 86 as a part of a consortium pursuant to the Libyan Exploration Production Sharing Agreement in 2004. The company holds 50 per cent participating interest in the block as operator. The other consortium member is IOC, which holds 50 per cent participating interest as non-operator.
Area 86 is located in south western Libya, approximately 700 km south of Tripoli, and covers an area of 7,807 km. The company had also acquired an indirect 17.50 per cent participating interest in a block called OPL-205, in Nigeria.
In Iran, the company has a consortium with OVL and IOC for an exploration service contract for the Farsi offshore block by the National Iranian Oil Company in 2002. The company holds a 20 per cent participating interest in the Farsi offshore block as a non-operator.