ONGC, PetroVietnam to bid in weeks for BP asset

India's state-run explorer Oil and Natural Gas Corp (ONGC.BO) and PetroVietnam are expected to submit a joint formal offer within weeks to buy BP's stake in the Nam Con Son gas project, Oil Secretary S. Sundareshan said.

ONGC has a 45 percent share in Block 6.1 in the Nam Con Son basin, off Vietnam's southeast coast, operated by BP, which has a 35 percent stake. The remaining 20 percent is owned by state-run PetroVietnam.

Hanoi said last week that BP should give priority to its partners in the project.

"We met with the prime minister of Vietnam and we had said that we will work with PetroVietnam (to buy BP's stake). We are discussing it with BP. Petrovietnam is also discussing it," Sundareshan told reporters on Tuesday.

The oil major said last week it planned to sell its stake in the Nam Con Son project, part of its goal of selling $30 billion in assets over the next 18 months to cover costs related to the oil spill in the Gulf of Mexico.

The stake would be a welcome acquisition for India, which has been lagging China in the hunt for natural resources to feed the fast economic growth in both countries.

BP' stake, which includes interest in the Lan Tay and Lan Do gas fields, the Nam Con Son pipeline and the Phu My power generation project, is worth $966 million, UBS analysts have said.

Others Keen to Join

Oil India Ltd another state-run Indian explorer, was also keen to partner with ONGC and PetroVietnam to buy BP's stake in the gas field, its chairman, N.M. Borah, said.

Borah said a group of Oil India, and two other state-owned companies, GAIL India and Indian Oil Corp would join the two companies.

"The approach and goal is to combine our strengths together with PetroVietnam," Borah told reporters.

Asked why Indian firms were keen to partner with the PetroVietnam, Borah said PetroVietnam had the first right of refusal on BP's Vietnam assets.

"Partnership with a local firm there will help us in exploring new opportunity in Vietnam and in third countries," he said.

Borah also said details of the likely approach had not yet been worked out.

China's CNOOC and Sinopec and Thailand's PTTEP are also likely to express interest in the stake, bankers and analysts told Reuters earlier this month.

[Source: By Nidhi Verma, Reuters, New Delhi, 27Jul10]

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