Videocon starts selling stake in Mozambique gas field

MUMBAI: Videocon Industries has initiated the process to sell its 10% stake in the Mozambiquebased Rovuma offshore gas field in a deal that may fetch the company $2.5-$3 billion, an executive involved in the development told ET. The company, along with USbased Anadarko Petroleum Corp, is in the process of together auctioning 20% stake in the oil field to raise an aggregate of $5-6 billion. The first round of bid is scheduled for March 14. In an email response to ET’s query, Anadarko Petroleum, which holds 36.5% in the property, said that it intends to sell up to 10% stake in the Rovuma Offshore Area 1 but would retain operatorship of the asset. Anadarko Petroleum did not confirm details of the auction; Videocon declined to comment.

Industry sources revealed that India’s Oil India Corporation, ONGC and international players like Shell, PetroChina, and Exxon Mobil Corp may acquire the stake in gas as the recent gas discoveries in Mozambique has renewed interest. This could not be confirmed individually by the probable suitors.

“Mozambique is gas rich and its proximity to India makes it a very attractive and strategic destination for India. Indian companies are interested in acquiring assets there . But this would not solve the energy problem immediately as gas supply from Mozambique would start only after 2018,” said Rahool Panandiker, principal, The Boston Consulting Group.

Mozambique, which is pegged to emerge as a major global supplier of liquefied natural gas, has had two significant gas discoveries in the Rovuma offshore field area in the recent past. With these discoveries, Mozambique’s gas reserves is pegged at 150 trillion cubic feet.