ONGC loses Angola bid to Chinese consortium

NEW DELHI: The Oil and Natural Gas Corp (ONGC) has lost out on a bid for an oil block in Angola to a Chinese-led consortium.

The Indian firm offered $310-million signature bonus for becoming a partner in Block 18, but its bid fell short of $725 million offered by a 75-25 Sino-Angolan joint venture, Sonangol-Sinopec International (SSI), industry sources said.

ONGC had bid lower than even Angola’s Grupo Gema ($400 million). Sources said pre-qualified operators for Block 18, Petrobras of Brazil and Chevron of US bid only $276 million and $272 million, respectively. However, Petrobras has been made operator taking a 30% interest with SSI getting a 40% stake.

Angola’s Falcon Oil and Gema Group have 5% working interest each. Angola had offered seven blocks — three in shallow water and four in deep water — in its first offshore licensing round.

Sources said Total of France is likely to get operatorship of Block 17 with 35-40% share, leaving SSI with 27.5% and three Luanda-based juniors-Angola Consulting Resources, Falcon Oil and Prodoil-and perhaps even Portugal-based Partex Oil&Gas to share the remaining interest, each with stakes of about 5%.

For Block 15, Eni offered $902-million signature bonus to take 35% stake. SSI will have 20% interest and Angola’s Sonangol P&P with 15% carried interest. Total will have 15% stake and Statoil of Norway, Petrobras and Falcon Oil would each hold 5%.

Petrobras landed operatorship of Block 26 (80%) and Block 6 (40%), the latter in partnership with Norway’s InterOil E&P, Falcon Oil and another Angolan junior Initial Oil&Gas. InterOil is also a partner in Block 5, which was won by US-based Vaalco Energy, while London-headquartered Tullow Oil will control Block 1.