Mumbai: London-based private equity and venture capital firm 3i Group Plc. is scouting for investments in the Indian oil and gas sector.
In addition to small and medium-sized exploration companies, 3i is also looking at investing in service providers in pipelines and technical support services, said a company executive, who did not wish to be named because he is not the authorised spokesperson for the firm.
3i recently picked up a 6.6% stake in B.K. Goenka-promoted Welspun Gujarat Ltd, which supplies undersea pipes to global oil majors such as Exxon Mobil Corp. and Royal Dutch Shell Plc.
The 3i executive said that the investment in the Indian oil and gas sector would come out of a $300 million (Rs1,179 crore) annual growth fund allocated for India. 3i recently announced its plan to invest $700-800 million across Asia annually. He said that the Indian fund is a part of the larger Asia investment fund.
Earlier this year, 3i invested an undisclosed sum in Franklin Offshore International Pte Ltd, a Singapore-based company that provides marine equipment and services to energy companies.
The company’s other energy-related investments in Asia include the exploration company Pearl Energy, which was acquired by Abu Dhabi-based Aabar Petroleum Investments Co. (PJSC) in January 2006, and the London Stock Exchange-listed Salamander Energy Plc., an upstream oil and gas exploration and production company.
Yogesh Garg, chief executive officer of Infraline Energy Research and Information Services, a New Delhi-based energy consultancy firm, pointed out that with 160 blocks currently under exploration in the country, the services segment in the oil and gas industry in India of is set to boom.
“Companies which provide two-dimensional and three-dimensional seismic surveys to explorers, erect platforms and provide other marine services or provide drilling services are set to grow two-threefold in the next couple of years and will continue to attract private equity players,” Garg said.
3i’s other investments in India include Adani Power Ltd, Mundra Port and SEZ Ltd, Nimbus Communications Ltd, UFOMoviez, and International Tractors Ltd.