Deora in Sudan: Seeks to resolve OVL's payment dispute

On his maiden African Safari, Petroleum Minister Murli Deora today pitched for more oil acreage for ONGC in Sudan while seeking resolution of dispute over payments for a pipeline that the state-owned firm built in the oil-rich nation.

Deora, who arrived here yesterday on the first leg of his whirlwind four-nation tour, raised the issue of payment defaults on the pipeline ONGC Videsh (OVL)built in the African nation with the Sudanese Minister for Energy and Mining Awad Ahmed Al Jazz.

Sudan, which had in 2007 defaulted on payment of installments towards the cost of building 741-km pipeline from Khatroum to Port au Sudan, agreed to form a working group to resolve the issue within a month, official sources said.

The overseas investment arm (OVL) of state-owned Oil and Natural Gas Corp (ONGC) built the project at a contracted price of $194 million. Repayments to OVL were to be made by Sudan over a period of nine years in 18 half yearly equated installments, the first installment being due on December 30, 2005.

OVL, which has interest in four blocks in Sudan which gives it 2.4 million tons of crude oil annually, wants to consolidate its operations and acquire more acreage in the African country.

Sources said Sudan invited the Indian firm to view data for exploration acreage it will be offering in licensing round this year. It offered exploration blocks to OVL.