It has earmarked US$2 billion for the project and has, in it sights, the likes of Niko Resources, Cairn Energy Plc, Tullow Oil and Premier Oil amongst others.
According to an anonymous source close to the action, “IOC is looking for a medium-sized foreign firm with expertise in oil and gas exploration and production [and] a proposal for setting up an E&P subsidiary is listed for approval at the company’s board meeting on 28 April.”
Already the country’s largest refiner and holding 60% market share in the petrol retail market, having an E&P firm will allow IOC to become a fully integrated company. It will also cut the company’s dependence on crude imports as it would be acquiring its own oil and gas fields via the E&P unit.
Other rumblings in the sector also indicate the decision to acquire an E&P subsidiary comes on the back of the Indian government decision to turn down IOC’s request to split India’s overseas investment firm ONGC Videsh Ltd to accommodate IOC and gas GAIL India Ltd as partners.
