Bhutan welcomes Indian investment

The Bhutan Government has invited Indian investments in hydroelectric power generation, information and communication technology, hospitality, education and health sectors as part of its economic liberalisation programme, which is under preparation.

Bhutan is currently allowing 100 per cent FDI in IT and 70 per cent in power (invested mostly by the Indian PSUs through a co-operation agreement between the two countries). The new policy is likely to be even more liberal. According to the India- Bhutan co-operation treaty, 10 hydel power projects are to be implemented by 2020. Until now one project (Punat Sangchu) of 1,200 MW has become operational recently and the country is hoping to implement the rest within the scheduled timeframe.

OVL refuses Zubair oil field offer

OVL and its consortium partners, O.A.O. Gazprom and Turkish Petroleum Corporation, have reportedly refused Iraq's offer of a service contract for the Zubair oil field. The offer has been declined on the issue of minimum remuneration that a service contractor earns for producing incremental oil from the field as well as maintaining the existing production. Iraq wanted the minimum remuneration amount to be reduced by $2-a-barrel, which was found to be not lucrative. Iraq had invited bids for 20-year-service contracts to dig out resources from four oil blocks, along with Zubair, and two gas blocks. Iraq is offering the oil fields on long-term contracts. The companies will be paid a flat fee for their services instead of productionsharing contracts, through which the companies and the Government share the oil and its profit. The Zubair oil field currently produces 2.3 lakh bpd of oil and the capacity can be raised to four lakh bpd. The other companies, which had also bid for the oil field were conglomerate led by BP plc, Exxon Mobil, and ENI Shell, Sinopec and Total S.A.

JSPL to acquire coal mine in South Africa

Jindal Steel & Power Ltd (JSPL) is in the process of acquiring coal mines in South Africa, according to sources. The mine is being acquired from South African mining firm ESF. The deal size is expected to be around Rs 350-400 crore depending on the quality and grade. The transaction is likely to be funded through a mix of debt and internal accruals. The mine has reserves of more than 50 million tonne of thermal coal, which is mainly used in power generation.

OVL-GAIL conglomerate plan capex for Myanmar gas fields

OVL and GAIL (India) in collaboration with Daewoo Corporation and Korea Gas Corporation (KOGAS) are planning to invest $3.73 billion (approx Rs 17,933.84 crore) for their natural gas find in Myanmar. The four partners are expected to invest $2.79 billion (approx Rs 13,141.32 crore) in the three gas fields in block A-1 and A-3 off the Myanmar coast and another $936.26 million (approx Rs 4,501.2 crore) for laying under-sea pipeline to take the gas to the shore. Daewoo holds 60 per cent stake each in block A-1 and A-3 while ONGC Videsh Ltd (OVL) has 20 per cent interest. Myanmar Oil and Gas Enterprise has right to take 15 per cent, subsequent to which Daewoo will have 51 per cent, OVL 17 per cent and GAIL and KOGAS 8.5 per cent each.

Daewoo has prepared a preliminary Field Development Plan (FDP) to tie-up Shwe and Shwe Phyu in block A-1 and Mya in block A-3 together to produce 500 million standard cubic ft per day of gas for 19 years. The field life is envisaged for 28 years. The final FDP is expected to be submitted by August 2009. As per the preliminary FDP, the gas fields are likely to be developed in phased manner, wherein Shwe and Mya (North) fields in Phase I, addition of Mya (South) field in Phase II, addition of Shwe Phyu field in Phase III and installation of future compressor once pressure declines at Central Process Platform. First gas production is likely to commence in first quarter of 2013. The produce from these fields is likely to be sold to China for $7.72 per million British thermal unit at the landfall point in Myanmar.

OVL keen to acquire stake in Ghana fields

OVL has evinced interest in acquiring 30 per cent stake in Jubilee oil fields in Ghana from the US based Kosmos Energy. The company is likely to join

hands with a foreign firm to submit its formal bid. The proposed bid is expected to be in the range of $3-4 billion (approx Rs 14,640 - 19,520 crore). The Jubilee oil fields are estimated to have oil reserves of 1.2 billion barrels and its commercial production is likely to start in June 2010. The other potential bidders include Royal-Dutch Shell, US based Exxon Mobil and Chevron Corporation, ENI of Italy, Ghana's national oil firm and China National Offshore Oil Company. Kosmos Energy has roped in Standard Chartered and Barclays as its advisors for the stake sale. The company owns 30 per cent in the Jubilee while the other partners include US based Anadarko Petroleum.

Tata Steel raises stake in Riversdale

Tata Steel Global Minerals Holdings, a subsidiary of Tata Steel, had raised its holding in Riversdale

Mining Ltd (RML), Australia, to 19.38 per cent through market purchases. Tata Steel subsidiary already holds about 15 per cent stake in RML. Riversdale Mining is a JV partner of Tata Steel for a coal project in Mozambique, where the production is slated to commence in 2011. RML has acquired coal exploration tenements at the Tete-Moatize area in Mozambique, whose combined size is now in excess of 250,000 ha. In Tete province, the Benga coal project is being developed as a JV between RML (65 per cent) and Tata Steel Global Minerals (35 per cent).

OVL's Phase I of Brazil project goes on stream

OVL along with Shell and Petrobras, Brazil, has commenced crude oil production at its multi-field Parque das Conchas project on 13 July 2009. Currently, the field is producing small volumes but the output is likely to be ramped up to 1,00,000 bpd shortly. Parque das Conchas is a two-phase project with initial production drawn from three fields: Abalone, Ostra and Argonauta B-West. The Phase I which has begun production, involves nine producing wells and one gas injector well. Phase II will focus on the Argonauta O-North field. Shell Brasil is the operator of the project with a 50 per cent stake while Petrobras has 35 per cent interest. ONGC Campos, a fully-owned subsidiary of OVL, owns 15 per cent.

CIL calls EoIs for coal mining in foreign countries

Coal India Ltd (CIL) has invited EoIs for selecting strategic partners for undertaking coal mining activities in foreign countries. CIL is looking for potential partners in Australia, USA, South Africa and Indonesia for undertaking joint business initiatives in coal mining. The company has division called Coal Videsh to facilitate its foreign operations and enhance energy security of the country. Coal Videsh will be dealing with potential strategic partners for coal mining in the four identified countries and it is also looking for acquisition of virgin coal blocks, opening of new mines and export the produce to India.

Tata Group to launch five-star hotel in South Africa

Tata Group is planning to open Taj Palace Hotel - its first five-star hotel - in Cape Town by December 2009. Currently, the 176-room hotel is being constructed and is likely to cost $65 million (approx Rs 312 crore). The newly planned hotel will incorporate the old Reserve Bank building and the former headquarters of Bank of England. The facades and many of the original features of the two 19th century buildings will be included in the new hotel. The rooms and suites will be in a tower block rising behind it. The proposed hotel is the first of a number of hotels the Tatas have planned in South Africa, with one more each in Johannesburg and Durban. The group prefers to own its own hotels, either alone or in partnership.