Foreign oil cos eye GSPC's gas

MUMBAI: A number of foreign oil majors including Exxon Mobil, Shell and BP have expressed interest in buying a stake in Gujarat State Petroleum’s gas field in the KG basin. GSPC had struck gas in the offshore block ‘Deendayal’ in June ’05.

The size of the reserve, was placed at 20 trillion cubic feet, enough to supply 70-80m cubic metres/day of natural gas. The company is reportedly been looking for partners to help in developing the gas field. DJ Pandian, managing director, GSPC, refused to comment.

GSPC is also scouting for drilling rigs for further drilling in the KG OSN-2001/3 block, where it had made the discovery. Canada-based GeoGlobal and Jubilant Enpro are partners in the block with a total stake of 20%.

GSPC, which has an 80% stake in the block, has budgeted a total spending of $262m for the block during FY07. Four wells have been drilled in the block so far, two of which were abandoned. The third well, KG#8, hit paydirt in June ’05, when the Deendayal field was announced publicly.

During FY05, GSPC recorded a turnover of Rs 1,296 crore and a net profit of Rs 281 crore. GSPC needs additional resources to meet further E&P expenses. Therefore, the company’s scouting for partners.

GSPC has interests in 23 other oil fields and blocks in India, in partnership with various Indian and foreign companies. This includes 12 discovered oil & gas fields, 10 exploration blocks and 1 coal bed methane block. Most of GSPC’s revenue comes from the Hazira gas field in Gujarat, where it has a 66.67% stake.

GSPC is an unlisted company — the government of Gujarat holds a 95% stake in it while the remainder is held by other state government companies. Of these, Gujarat Mineral Development Corporation, Gujarat Narmada Valley Fertilizer, Gujarat State Fertilizers, Gujarat Alkalies and Gujarat Gas are listed.

The first three stocks were up by 0.22%, 2.29% and 0.37% on Thursday while GGCL was down by 1%. GNFC, GMDC and GACL have a 0.95% stake each in GSPC.