Deora pitches in to resolve OVL payment dispute with Sudan

Written by Press Trust of India | Khartoum | Updated: Jan 27 2010, 03:46am hrs
Petroleum minister Murli Deora on Monday pitched for more oil acreage for ONGC in Sudan while seeking resolution of dispute over payments for a pipeline that the state-owned firm built in the oil-rich nation.

Deora, who was on his maiden African Safari, arrived here on Sunday on the first leg of his whirlwind four-nation tour, raised the issue of payment defaults on the pipeline ONGC Videsh (OVL) with Sudanese energy minister Awad Ahmed Al Jazz.

Sudan, which had in 2007 defaulted on payment of installments towards the cost of building 741-km pipeline from Khatroum to Port au Sudan, agreed to form a working group to resolve the issue within a month, official sources said.

OVL built the project at a contracted price of $194 million. Repayments to OVL were to be made by Sudan over a period of nine years in 18 half-yearly equated installments, the first installment being due on December 30, 2005.

OVL, which has interest in four blocks in Sudan which gives it 2.4 mt of crude oil annually, wants to consolidate its operations and acquire more acreage in the African country.

Sources said Sudan invited the Indian firm to view data for exploration acreage it will be offering in licensing round this year. It offered exploration blocks to OVL.

Sudan gets 90% of its revenues from export of oil. Jazz, they said, sought Indian assistance in gas operations, biofuels technology, well stimulation and reservoir management and enhance oil recovery (EOR) schemes, a request that Deora readily agreed.

Sudan would send teams to India this year for training in these disciplines.