Bharat Petroleum Corporation (BPCL) plans to submit a $350-million, non-binding bid to acquire a 10% interest in the lucrative M?Boundi oil field in the Republic of Congo. If successful, it will mark the state-owned oil major?s entry into oil- and gas-rich Africa. Standard Chartered is the financial adviser for the bid.
Sources said BPCL?s board has already considered the proposal and has advised the company to carry out thorough due diligence on crucial aspects like reserve certification by independent experts. The expert will also study the political environment in the country.
This is especially significant to determine the rights of the successful bidder on the oil extracted from the field. The other issues to be considered include pricing the crude blend, the capacity of the pipeline and the rights and cost of using the pipeline for transport of crude.
Other Indian companies that have forayed into the African oil and gas sector include ONGC Videsh, IOC and Engineers India Ltd. OMEL, the joint venture company of OVL and LN Mittal, has also chalked out plans for Africa.
BPCL recently bought Canadian company EnCana?s offshore assets in Brazil: EnCana Brazil Petroleo Limitida. BPCL submitted the bid jointly with Videocon Industries and the value of the bid, according to sources, ranged between $185 million and $255 million.
The bid was submitted by BPCL?s exploration firm, Bharat PetroResources Ltd (BRPL), and an overall limit of $100 million was set on BRPL?s share for bidding in the Brazilian property with Videocon.
BPCL has been striving to consolidate its presence in the upstream oil and gas sector, both in India and abroad. In consortium with other players, BPCL has been bidding for blocks in Oman, Australia and East Timor. BPC has also ‘farmed-in’ on an on-land block at Cachar in Assam. In addition, BPC has participated in the recently concluded Nelp-VI bidding round and in the bidding for two blocks in Egypt.