Wednesday, December 27, 2006
Indian rival oil companies plan to share southern oil field
Oil
State-run Oil and Natural Gas Corp (ONGC) and its private competitor Reliance Industries Ltd (RIL) are in talks to jointly develop Tuba oil field in southern Iraq, top ONGC officials said on Tuesday. ONGC, through its overseas investment arm ONGC Videsh Ltd, along with RIL and Algeria's Sonatrach tried in 2000 to secure the field in Iraq for production of crude oil. A senior company official, who did not wish to be identified, said ONGC had initiated talks with RIL and Sonatrach to revive the consortium and pursue the opportunity jointly. ONGC chairman and managing director R. S. Sharma confirmed the project was being discussed, and said: "Yes we are in talks with Reliance on Tuba field."
A Reliance official declined to comment. The ONGC official who declined to be named said discussions were still at a preliminary stage. He said ONGC and RIL were expected to hold a 30 per cent stake each in the project-specific consortium and Sonatrach would hold the remaining 40 per cent. Iraq is expected to enact an oil law that would allow the regions to negotiate oilfield contracts with foreign investors. Analysts say if the consortium works out, it will be the first time that two arch rivals, ONGC and Reliance, work together abroad rather than competing. India imports 70 per cent of its crude oil demand.
