INDIA’S LARGEST oil group is in talks with BP to buy its Vietnamese assets as the UK company works towards the $10 billion of sales it has targeted in the wake of the Gulf of Mexico oil spill.
RS Sharma, chairman of the state-owned Oil and Natural Gas Corporation (ONGC), said that he would be in Hanoi with Murli Deora, India’s oil minister, to discuss the deal with the Vietnamese authorities and PetroVietnam, the state oil company.
He said the matter would also be discussed with David Cameron, the UK prime minister, on his official visit to New Delhi next week.
“BP has given its intention that they want to sell their stake in the Vietnam oilfield and we are discussing with them a way to reach a deal,” said Mr Sharma. “We will be talking with Cameron and his team . . . the government is fully backing this deal.”
BP intends to sell all of its assets in Vietnam and Pakistan, except for its lubricants business, in its drive to raise $10 billion to help pay for the Gulf oil spill clean up and compensation.
The Vietnamese assets are valued at about $966 million and the Pakistan business at about $690 million, according to UBS. ONGC said it was only interested in Vietnam, where it already has interests.
BP has been operating in Vietnam for more than two decades and its flagship asset is the Nam Con Son gas project in the South China Sea, in which it has a 35 per cent interest in two fields, with ONGC holding a 45 per cent stake and PetroVietnam owning a 20 per cent stake.
BP has a minority stake in the 371km Nam Con Son pipeline connecting the field to onshore terminals, and controls a third of the Phu My power plant.
“We would welcome interest from any parties and we’ll work towards a deal hopefully by the end of the year,” said BP.
BP Plc should be required to specify in writing how it will fund,protect and replenish a $20 billion fund dedicated to paying cleanup and damage claims from the Gulf of Mexico oil spill, lawyers suing the company said in a motion filed with US District Judge Carl Barbier in New Orleans.
Barbier is presiding over more than 30 spill-damage cases.
One fund is the $20 billion spill-claims escrow account and the other is a $100 million companion fund for oilfield workers. – (Copyright the Financial Times Limited 2010/Bloomberg)
