The assets owned by EOGIL are 30 per cent interests in the Tapti gas field and the Panna/Mukta oil and gas field, and a 62.64 per cent interest in the CB-OS/1 exploration licence. All are located on the west coast of India. These operations, which include important development and exploration opportunities, are operated by EOGIL. The sale, which is subject to a number of consents and conditions including confirmation from joint venture partners of EOGIL's continuation as operator after completion, is expected in the coming weeks. Frank Chapman, Chief Executive, BG Group, said: "On completion of this transaction BG Group will have significantly enhanced its position as a leading player in the large and rapidly growing Indian energy market. Gas exploration and development opportunities will enable further growth of BG Group's gas strategy, reinforcing expansion plans, premised on the recent Lakshmi gas purchase. Furthermore, we see the building of gas markets in Gujarat and Maharashtra States as an important stepping-stone in realising our long-term goal of importing liquefied natural gas through our Pipavav project. We are now driving hard to complete this new acquisition which will establish India as another core area of operations for the Group."
Jeff Sherrick, President and Chief Executive Officer, Enron Global Exploration and Production (EGEP), said: "Today's announcement represents another significant step for Enron in selling assets not integrated into our wholesale or retail energy businesses."
Equity production from these fields, in the year to March 31, 2001, totalled an average of approximately 70 million standard cubic feet of gas per day and 8,200 barrels of oil per day. As at March 31, 2001, EOGIL had estimated net proved and probable reserves of over 170 million barrels of oil equivalent. These reserves are, therefore, being acquired at a cost of less than $2.30 per barrel of oil equivalent.
As at 31 March 2001, EOGIL had proforma net assets of $419 million. In the twelve-month period to 31 March, the company's proforma profit after tax was $60 million, on revenue of $160 million. Further development of both the Panna/Mukta and Tapti fields is expected over the next few years, subject to Government and partner approval. The other partners in the Tapti and Panna/Mukta offshore operations are Oil and Natural Gas Corporation Limited (ONGC), which holds 40 per cent and Reliance Industries Ltd., with a 30 per cent stake. The other partners in the CB-OS/1 licence are Hindustan Oil Exploration Company (17.36 per cent), Tata Petrodyne (10 per cent) and ONGC (10 per cent). The consideration is payable in cash once the transaction has been completed.
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