State-owned Oil India Ltd on Monday said it is in talks to buy 51 percent in billionaire Mukesh Ambani's privately owned firm Reliance Gas Transportation Infrastructure Ltd (RGTIL).
New Delhi: State-owned Oil India Ltd on Monday said it is in talks to buy 51 percent in billionaire Mukesh Ambani's privately owned firm Reliance Gas Transportation Infrastructure Ltd (RGTIL).
"We have expressed interest for buying 51 percent stake in RGTIL," Oil India Ltd (OIL) Director (Finance) T K Ananth Kumar told reporters.
OIL is one of the 11 firms -- five Indian and six foreign -- that have expressed interest to buy stake in RGTIL.
State-owned GAIL India Ltd and NYSE-listed energy major Enbridge are among the firms interested in buying stake.
"We have submitted a separate EoI," he said.
The stake sale is being managed by JPMorgan, Citi and SBI Caps.
Stating that OIL has ambitions to diversify into gas sector, he said the a financial bid would be made only after proper due diligence.
RGTIL was originally a subsidiary of Reliance Industries Ltd (RIL) and was incorporated in March, 2003 to transport natural gas from eastern offshore gas fields to consumption centres. Two years later, it was transferred to Mukesh Ambani, chairman of RIL.
It was said at that time that Ambani may sell stake in the company through an initial public offering (IPO) once RIL's eastern offshore KG-D6 field hit peak volumes of 80 mmscmd.
But with KG-D6 output plummeting to less than 34 mmscmd, he wants to sell the gas pipeline business.
RGTIL today operates a 1,396-km East-West gas pipeline. The 80 million standard cubic meters per day capacity, 48-inch pipeline from Kakinada in Andhra Pradesh to Bharuch in Gujarat ferries natural gas from KG-D6 fields.
Relogistics Infrastructure Ltd (Relog), a subsidiary of RGTIL, has won government authorisation to lay Kakinada- Basudebpur-Howrah pipeline, Kakinada-Chennai line, Chennai- Bangalore-Mangalore pipeline and Chennai?Tuticorin line.
RIL is the operator of KG-D6 block with 60 percent stake while UK-based BP Plc has 30 percent interest. Canada's Niko Resources owns the remaining 10 percent.
Ananth Kumar said OIL was also in talks to buy a stake in Chesapeake Energy Corp's Mississippi Lime unconventional oil assets in Oklahoma, US.
The Mississippi Lime play in northern Oklahoma is a conventional - if somewhat complex - carbonate reservoir that is rich in oil and natural gas liquids (NGL) like butane.
Chesapeake Energy is looking at stake sale in its unconventional liquid-rich Mississippi Lime play covering 2 million acres.