India GSPC Hopes Offshore KG Basin Stake Sale by End-Jan

KG Block
(Click to Enlarge)
NEW DELHI, Nov 17, 2006 (Dow Jones Newsires)

Gujarat State Petroleum Corp. hopes to sell up to 30% of its equity in its natural gas block off India's eastern coast by the end of January, company managing director D.J. Pandian said Friday.

"The bidders have asked for some more data. We are planning another round of testing at our well later this month. We will provide the data to the bidders and hope to sell the stake by end-January or February," Pandian told Dow Jones Newswires.

GSPC is looking for a partner that will buy up to a 30% stake in its gas discovery in India's Krishna-Godavari basin.

GSPC is a wholly-owned enterprise of the Gujarat state government. The company is involved in domestic oil and gas exploration ventures.

Separately, a GSPC executive said four companies have been shortlisted to partner the company in developing the gas find.

"The companies we have shortlisted are BP PLC (BP), BG Group PLC (BRG), Chevron Corp. (CVX) and Italy's Eni SpA (E)," said the executive, who did not wish to be identified.

As many as 11 companies had initially shown interest in purchasing a stake in the GSPC gas discovery.

"We lack technical expertise. More than the financial strength of the partner, we are looking at a company which can bring in technological expertise," said the executive.

GSPC struck gas in the Krishna-Godavari basin in June 2005, where it estimates reserves to be around 20 trillion cubic feet.

The company is also planning an initial public offer after it completes the sale of the stake in the gas block.

"We are planning an IPO, but there is no time schedule. We are working on is still at a preliminary stage," said Pandian.

Pandian declined to say how much the company hopes to raise through the stake sale and IPO.

Copyright (c) 2006 Dow Jones & Company, Inc.

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