Petroleos De Venezuela may buy big stake in MRPL refinery

Venezuela’s state-run oil company Petroleos De Venezuela SA (PDVSA) is looking to acquire a major equity stake in MRPL’s existing refinery as well as the 15 mmtpa refinery proposed to be set up in the Mangalore SEZ. Additionally, the company is seeking to pick up stakes in the discovered and producing assets of ONGC in India and abroad.

In MRPL, ONGC holds a majority stake of 71.62%, while HPCL holds 16.97% and is seeking to enhance its stake in MRPL to over 26%. Besides monetary considerations and offering them equity in their rich oil fields in Venezuela, PDVSA may enter into crude supply and product off-take arrangements with ONGC. PDVSA’s business development unit Corporacion Venezulana de Petroleo (Venezuelan Petroleum Corporation) will be negotiating the stake deal with the Indian government and ONGC.

PDVSA is also in negotiations with OVL, the overseas arm of ONGC, to offer a 30% stake in the San Cristobal block. The company is in the process of procuring certification for the reserves in the block, which may take another 18 months. Preliminary estimates of the in-place reserves are 1.3 trn barrels of oil. The oil found is heavy and only 20%, or 235 bn barrels, is recoverable.

Read The Economic Times article.

Qatar’s RasGas to acquire 10% in Petronet LNG; stake valued at Rs. 460 crores

RasGas from Qatar may buy around 10%s equity stake in Petronet LNG (PLL) for a consideration of around Rs. 460 crores. PSU oil majors ONGC, BPCL, GAIL and IOC each having a 12.5 % stake in the company will divest 2.5% each to RasGas. RasGas is doing the due diligence.

RasGas is the first supplier of LNG to India and currently supplies 7.5 mn tonnes a year to Petronet’s LNG terminal at Dahej in Gujarat. RasGas and Petronet are in a 25-year sale and purchase agreement for LNG supplies. After diluting 10% stake to RasGas, BPCL, IOC, GAIL, ONGC and Gas de France will have stakes of 10% each in PLL. ADB will retain its 5.2% stake, while the remaining 34.8% lies with the Indian public.

The company requires Rs. 1700 crores for the expansion of Dahej LNG terminal from 5 mmtpa to 12 mmtpa. The company has tied up for a debt of $300 mn ($100 mn through FCCBs) and the balance would be funded by internal accruals. The company also envisages building the Kochi terminal at a cost of Rs. 2500 crores by 2010. The company has also allocated Rs. 300 crores for vessels, Rs. 460 crores for new jetty and Rs. 150 crores for solid cargo port.

Read the article in The Economic Times.