GSPC plans IPO in 6-12 months

Gujarat State Petroleum Corporation (GSPC), which has discovered India's largest-ever gas field, is planning an initial public offer (IPO) of 10-20% of equity to part fund the Rs 1,500 crore investment for beginning production from the Bay of Bengal field by 2007-end.

"We plan to invest Rs 1,500 crore in developing the gas field. The funds would be raised through debt, internal resources and IPO in equal proportion," D J Pandian, managing director of GSPC, said today.

He said GSPC, which is currently 100% owned by the Gujarat
government, plans to dilute 10-20% equity through an IPO in the next 6-12 months.

Pandian, however, did not give the amount GSPC plans to raise through the IPO. "It will depend on the premium we can command."

GSPC yesterday claimed to have found 20 trillion cubic feet of gas reserves in the third well in the block KG-OSN-2001/3, some 6-km from the Andhra coast.

The initial estimates of the find are more than Reliance Industries' 14 trillion cubic feet find in deepsea in the same Krishna-Godavari basin, and ONGC's legendary Bassein field, off Mumbai coast, which has 10 TCF of proven reserves.

GSPC plans to begin production from the gas field by 2007-end beginning with an initial production of 5-7 million standard cubic meters.

Pandian said the reserves announced yesterday were only an initial estimation based on testing of one of the five zones in the well and 3D seismic survey done previously. "We are not saying these are proven reserves."