New Delhi: State-run Oil and Natural Gas Corp. Ltd and GAIL (India) Ltd plan to take a 12.5% stake in the $2.01 billion (around Rs9,385 crore) gas pipeline that China is building in Myanmar to transport natural gas found in the Bay of Bengal.
People close to the development said the cabinet committee on economic affairs is likely to soon consider a proposal allowing ONGC Videsh Ltd (OVL), the overseas arm of the state explorer, and GAIL to invest $251.2 million in the 870km pipeline China National Petroleum Corp. (CNPC) is laying in Myanmar to supply gas found in offshore blocks A-1 and A-3 to mainland China.
Expansion mode: A file photo of an ONGC offshore platform. Bloomberg
ONGC has agreed to lend around Rs4,000 crore to OVL to fund its share of cost of developing the gas fields in A-1 and A-3 blocks and the pipeline to China.
Officials said that CNPC has offered a 49.9% stake to the consortium developing gas fields in blocks A-1 and A-3.
South Korea’s Daewoo Corp. holds 51% stake each in Block A-1 and A-3 while OVL has a 17% stake. GAIL and Korea Gas Corp. (KOGAS) have 8.5% each while the remaining 15% is with Myanmar’s Myanma Oil and Gas Enterprise (MOGE).
The consortium is investing $3.61 billion in bringing to production gas fields in the two blocks. Officials said Daewoo too was inclined to participate in the 40-inch pipeline and final shareholding in the pipeline project would be CNPC-50.9%, MOGE-7.37%, Daewoo-25.04%, OVL-8.35%, GAIL and KOGAS-4.17% each.