INDIA BUSINESS WORLD - OCTOBER 21st - NOVEMBER 15th
- 2007
IVRCL ACQUIRES OIL E&P CO FOR $50 M
Hyderabad-based IVRCL Infrastructures and Projects has acquired Alkor Petroo, an unlisted oil and gas E&P company, for $50 million.
This marks the maiden acquisition for IVRCL in oil and gas sector. It has, in fact, joined the bandwagon of several other infrastructure companies eyeing opportunities in oil exploration, following the recent oil finds by companies such Reliance Industries, Cairn Energy and GSPL.
At present, IVRCL only builds oil pipelines for state-owned companies such as BPCL and IOC. It has been scouting for partners to bid for the seventh round of the National Exploration and Licensing Policy (NELP) programme.
Alkor holds five exploration blocks in the Republic of Yemen and Arab Republic of Egypt along with Gujarat State Petroleum Corporation (GSPCL) and others. It has a 25% participating interest in each of the three blocks in Yemen and 20% each in both the blocks in Egypt.
IVRCL has tied up with GSPCL which will operate all the five blocks. "We will invest about $50 million during the exploration phase. The acquisition marks a new beginning for us as we want to expand beyond just building pipelines", IVRCL managing director E Sudhir Reddy said.
Based on the best estimates of the resources from an internationally reputed agency Block 19 (Yemen) and Block 6 (Egypt) have a potential to earn revenues of over $1 billion for the company during the life of the respective blocks. The revenues for the other blocks are under evaluation, he said.
IVRCL has also tied up with Russia based oil and gas exploration and pipeline company Podvodtruboprovodstroy (PTPS). Plans are on the cards to forge a partnership with a Nigerian oil company as well.
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