BP may not sell stake in Vietnam gas fields to ONGC

UK's embattled energy major BP Plc today said it may not sell its stake in Vietnam gas fields to India's Oil and Natural Gas Corporation (ONGC) as it is looking at the possibility of transferring the stake to an affiliate company.

BP's new CEO Robert Dudley, on his first day at work, was in India to meet partners Reliance Industries' head Mukesh Ambani and Tata Power chairman Ratan Tata in Mumbai and Oil Minister Murli Deora here.

Dudley said that his meetings with Ambani and Tata were to review on-going projects that BP has with the two companies.

He will make a courtesy call on Prime Minister Manmohan Singh tomorrow morning.

BP is a partner with RIL in an NELP Deep Sea Block (D17), where the two companies are preparing to shoot seismic service. With Tatas, BP has a solar project in Bangalore.

On ONGC's interest in buying BP's stake in a Vietnam gas project, Dudley said the company is yet to decide if it will exit from the project.

"We have made no decision (on exiting from Vietnam project)," he said.

If BP decides to exit Vietnam project, "we may think of transferring the interest to an affiliate company", Dudley said.

Asked if the affiliate could be TNK-BP, he said, "That is an affiliate company and that is a possibility".

He said that he along with outgoing CEO Tony Hayward did not discuss the sale of any of BP's assets worldwide with Mukesh Ambani.

OVL, the overseas investment arm of state-run ONGC, wants to buy BP's 35 per cent stake in the $1.3 billion Nam Con Son gas project in Vietnam.

OVL has roped in Vietnam's PetroVietnam for buying BP's stake in two offshore gas fields, a pipeline and power project -- together referred to as Nam Con Son.

Block 06.1, where the Lan Tay and Lan To fields currently produce about 14 million cubic metres of gas per day, was originally allocated to OVL, but due to the foreign exchange crisis of the 1990s, it had to farm-out some of its stake to BP. OVL has a 45 per cent stake in Block 06.1, where the balance 20 per cent is with PetroVietnam.

The Nam Con Son project's upstream part is Block 06.1, located 370 km South–East of Vung Tau on the southern Vietnamese coast. The 955 sq km block holds the Lan Tay and Lan To gas fields.

OVL has so far invested $217 million on the gas fields and has government approval to invest up to $377.46 million.