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RIL, Essar in race to buy BP’s Africa assets

RIL, Essar in race to buy BP’s Africa assets
PTI
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First Published: Wed, Jul 28 2010. 02 34 PM IST
Updated: Wed, Jul 28 2010. 02 34 PM IST
New Delhi: Mukesh Ambani-run Reliance Industries and Essar Oil are among about half a dozen firms in race to buy crisis-hit British energy giant BP’s fuel marketing assets in east African countries.
BP is selling retail outlets, terminals and aviation fuel stations in Botswana, Tanzania, Namibia, Malawi and possibly also in Zambia, to cover costs related to the worst oil spill in US history, industry sources said.
Reliance and Essar have offered between $400 million to $500 million for BP’s assets in the East African nation, they said.
A South African firm and National Oil Corp of Libya are said to be other serious bidders among about half a dozen firms who have evinced interest.
While Essar Oil spokesperson did not offer any comments, a Reliance spokesperson said: “We do not comment on market speculation as per company policy.”
Sources said Reliance may be looking at supplying gas oil, gasoline and jet fuel from its twin refineries at Jamnagar in Gujarat to the east African nations.
It also exports fuel to Gulf Africa Petroleum Corp, a firm it had acquired in 2007. Gapco owns retail outlets in countries like Tanzania, Uganda and Kenya.
Essar Oil had last year acquired a 50% stake in 4 million tons a year Kenya Petroleum Refinery in Mombasa.
The British energy giant BP intends to sell $30 billion of assets -- mainly upstream oil and gas fields -- over the next 18 months to help pay for the Gulf oil spill clean-up and compensation.
BP owns retail outlets selling gasoline (petrol) and gas oil (diesel) as well as aviation refueling facilities at major airports in Botswana, Tanzania, Namibia, Malawi and Zambia.
The acquisition would give a company a ready market for auto and aviation fuel with scope for further expansion into neighbouring high growth countries, sources said.
In Botswana, BP operates 30 retail sites, mostly in the country’s main cities of Gaborone and Francistown and supplies fuel to the booming mining industry. Air BP in Botswana sells aviation fuel at Sir Seretse Khama Airport in Gaborone and Maun airport, on the edge of the famous Okavango Delta.
Besides selling fuel, lubricants and liquefied petroleum gas (LPG), BP is the largest aviation fuel supplier in Tanzania with about 92% market share.
BP owns half of BP Malawi, which operates 46 service stations. Press Corp has the remaining 50%. It is the sole supplier of aviation fuels and aviation lubricants to the nation’s two international airports at Lilongwe and Blantyre.
BP Namibia’s network includes 29 service stations, five depots and aviation services.
In Zambia, BP owns 53 out of the 196 pumps and a largest number of fuel storage and handling depots in the country. It sells aviation fuels at Lusaka International Airport and also Ndola, Livingstone and Mfuwe airfields.
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First Published: Wed, Jul 28 2010. 02 34 PM IST
More Topics: RIL | Essar Oil | Reliance Industries | BP | Oil |