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Assam Co in talks for global oil and gas tie-ups

Assam Co in talks for global oil and gas tie-ups
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First Published: Tue, Mar 06 2007. 12 06 AM IST
Updated: Tue, Mar 06 2007. 12 06 AM IST
Assam Company Ltd (ACL), the flagship company of the Duncan MacNeill group, is in negotiations for partnerships with oil and gas comapnies in Indonesia, Ukraine and Mongolia, to produce oil worth Rs1,000 crore a year.
The deals are expected to be firmed up in the next two months. “We are talking to prospective partners in these three countries at the moment. We expect to produce between 5,000 and 10,000 barrels a day of oil within a three-year time frame”, Abhay Chawdhry, director (finance) and chief financial officer, ACL, told Mint. He didn’t reveal the names of the prospective partners.
Once the deals are struck, the company will look at various options to raise funds for these operations. The amount to be raised will depend on the size of the oil fields and the local partner. Currently, oil sells at around $60 (Rs2,679) a barrel in the international market.
ACL, the first tea plantation company in the world (set up in 1839), forayed into the oil and gas sector in 2005. It began generating daily revenues of about Rs1 lakh from April 2006, after its Assam oilfields started yielding 400 barrels of oil a day. It has four oil and gas fields, two each in Australia and the United States.
In 2005, the company forged an alliance with Canadian firm Canoro Resources, for exploration and drilling in the development block of Amaguri, and exploration block AA/ON7 in Assam.
Canoro estimates ACL’s share of recoverable (over next 25 years) oil and gas reserves at around Rs16,418.80 crore. It also has three marginal oilfields in Assam from ONGC under service contracts.
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First Published: Tue, Mar 06 2007. 12 06 AM IST