New Delhi, Nov 26: Energy-hungry India and China,
often fierce rivals in the race for global oil and gas
supplies, have agreed to form a joint venture company for
acquisition of hydrocarbon assets in Africa and Latin America.
While the November 20-23 visit to India by Chinese
President Hu Jintao produced plenty of economic commitments,
the concept of increased collaboration on securing energy
assets was clearly missing from the official agenda.
But this did not deter Petroleum Minister Murli Deora
from using his old friend Chinese Commerce Minister Bo Xilai
to get a midnight audience with Ma Kai, the all powerful
chairman of the National Development and Reform Commission,
China's top planning agency.
Sources said Deora's unscheduled meeting with Ma Kai,
who looks after seven key economic portfolios, including
energy, brought about the critical meeting of minds on the
need for the two countries to bid together for oil assets so
as to avoid a price war.
"Both countries have in-principle agreed to work out a
mechanism to bid jointly for oil and gas properties in Africa
and Latin America. Indian and Chinese flagship companies will
pool resources together to form a special purpose vehicle or a
joint venture company to scout for assets in third countries,"
a source said.
An agreement for the purpose is likely to be signed in
Beijing next month when Deora will visit to attend a
ministerial meeting of oil importing countries.
China is hosting a meeting of energy ministers of US,
Japan, Korea and India on December 15.
Bureau Report
First Published: Sunday, November 26, 2006, 00:00