NEW DELHI (Dow Jones)
Oil & Natural Gas Corp. (500312.BY) is seeking producing assets in politically stable countries as it seeks to cut its geographical risks, the head of the Indian explorer's overseas investment unit said Tuesday.
"We have investments in many risky countries. We would be diversifying to more stable countries like North America," Joeman Thomas, managing director of ONGC Videsh Ltd., told reporters on the sidelines of a news conference.
The social and political upheaval in the Middle East and North Africa has drastically raised the risk profile of some prolific international basins that hold substantial hydrocarbon reserves, impacting investment plans of global oil and gas explorers, ONGC said in its annual report earlier this month.
OVL holds stakes in exploration blocks in places like Libya, Syria and Sudan, which have been hit by political unrest.
Thomas said the decision on re-adjusting the portfolio was taken about two years ago. He added that the company aims to acquire producing properties over the next two to three years as it has a mandate to source 20 million tons, or 400,000 barrels a day, of crude from overseas assets by 2020.
OVL expects its share of output from overseas assets at 8.75 million tons in the current financial year through March 2012, he said.
In March this year, India's top auditor had criticized OVL over its investments and joint ventures overseas saying that the explorer wasn't able to mitigate risks and leverage the benefits from the financial strength and expertise of the joint venture partners. The auditor said that OVL needed to improve its core competence in the evaluation of investment opportunities.Copyright (c) 2011 Dow Jones & Company, Inc.
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