Varun Shipping to invest Rs 450cr in offshore biz

Varun Shipping is planning to invest Rs 450 crore in the offshore sector by the end of calender year 2006.

"Varun Shipping will acquire oil rigs and infrastructure facilities to support offshore exploration activities. An oil rig costs anywhere between $150-200 million," sources said.

They added that the company would use a part of the proceeds from its proposed Singapore Depository Shares (SDSs), which would be listed on the Singapore Stock Exchange by June, for an offshore project.

Yudhishthir D Khatau, managing director of Varun Shipping, said the company is planning further investments in the offshore sector, but declined to comment on plans to acquire oil rigs. "We have no such plans at this point of time," Khatau added.

The company currently has two anchor handling, towing and supply (AHTS) vessels to support offshore-related activities. "The company will acquire second-hand offshore supply vessels (OSVs), platform supply vessels (PSVs) and multi-support vessels (MSVs) for Rs 450 crore. The acquisition will also coincide with the soon-to-be floated tenders of Oil and Natural Gas Company (ONGC)," sources said.

The vessels would also be deployed with other players including BG group and Reliance, they added.