Sahara enters oil and gas sector with EnSearch buy

Sahara enters oil and gas sector with EnSearch buy

New Delhi: The Sahara group, which is involved in a range of businesses, including entertainment, media and real estate, has entered the oil and gas sector with the purchase of EnSearch Petroleum Pvt. Ltd from Vinay Maloo-promoted Enso Group.

“Sahara is planning its play in hydrocarbon exploration and production, and has acquired EnSearch Petroleum," said a person aware of the development, who did not want to be identified. Mint could not ascertain the value of the transaction.

While Abhijit Sarkar, head of corporate communications at Sahara India Pariwar did not respond to an email sent on Friday, another person familiar with the development confirmed the group’s move into the hydrocarbon sector.

According to information available on the Enso Group’s website, EnSearch Petroleum has 13 assets in its portfolio with a net combined acreage of around 33,207 sq. km. It is the operator in four blocks, and apart from having one block in India is present in countries such as Australia, Jordan, Nigeria and Georgia.

The Sahara group publishes a Hindi-language newspaper that competes in some markets with Hindustan, published by Hindustan Media Ventures Ltd, a unit of HT Media Ltd, which publishes Mint.

Maloo is one of the founders of Himachal Futuristic Communications Ltd and quit to run the Enso Group, which also has other businesses such as infrastructure development and technology.

The group also has another company in the oil and gas business—Sonoran Energy (Jordan) Ltd, which has the Azraq block.

Repeated phone calls and email queries to Enso Group’s office in Mumbai on Friday remained unanswered at press time. Maloo did not respond to phone calls or to a message left on his cellphone.

Sahara has been looking at diversification plans. Mint had reported on 20 May about the group’s plan to launch a retail chain called Sahara Q Stores.

The group was also present in the aviation sector, but exited after Naresh Goyal-promoted Jet Airways (India) Ltd bought Air Sahara.

India’s oil and gas sector has attracted interest from investors such as London-based BP Plc and Vedanta Resources Plc this year. While Mukesh Ambani-owned Reliance Industries Ltd has offloaded a 30% stake in its hydrocarbon blocks to BP for $7.2 billion, Vedanta Resources plans to acquire a majority stake in Cairn India Ltd for $8.71 billion.

“Oil and gas is a prospective space. While the demand is going up, supply is not keeping pace. The outlook for the sector remains very strong," said Anish De, chief executive at Mercados EMI Asia, an energy consulting firm.

The entry of Sahara group into the hydrocarbon sector comes at a time when Sahara India Financial Corp. Ltd, India’s largest residuary non-banking company, has decided to wind up deposits and pay all its customers by December, about four years before a deadline set by India’s central bank.

In 2008, the banking regulator had asked Sahara India Financial not to accept fresh deposits and wind up the Rs20,000 crore of public deposits it had in seven years. It had also banned the company from accepting fresh deposits maturing beyond June 2011.

The Indian government is concerned about energy security and wants a large number of companies to participate in hydrocarbon exploration in the country under the new exploration licensing policy (Nelp), which kicked off in January 1999, to step up domestic oil and gas exploration and reduce India’s overwhelming dependence on hydrocarbon imports.

Sahara has filed a defamation case in a Patna court against Mint’s editor and some reporters over the newspaper’s coverage of the company’s dispute with the Securities and Exchange Board of India. Mint is contesting the case.

Shauvik Ghosh contributed to this story.