L N Mittal pulls out of Kazakh oil field

L N Mittal pulls out of Kazakh oil field

New Delhi: Signalling end of his oil and gas odyssey, steel magnate Lakshmi Mittal has pulled out of a project to develop an oil field in Kazakhstan in partnership with Oil and Natural Gas Corp and is looking to sell his stake to another company.

Days before the joint venture of ONGC Videsh and Mittal Investment Sarl was to sign agreement for taking 25% stake in the Satpayev oilfield in the Caspian Sea, the holding company of Mittal family decided to pull out of the Kazakhstan block, sources in know said.

It has also decided to sell 50% stake in Caspian Investments Resources (CIR), which produces less than 40,000 barrels per day of oil from four fields in Kazakhstan.

Mittal, in April 2009, walked out of an exploration block ONGC-Mittal Energy Ltd -- one of the two joint ventures he formed with the state-run firm for a foray into oil and gas space in 2005, had won in Trinidad and Tobago.

In Mumbai, ONGC chairman R S Sharma confirmed Mittal’s pullout. OVL had anticipated such a move and had a few months back sought Cabinet approval to invest all of the $400 million in the Satpayev on its own in case Mittal walked out.

Sources said Mittal has had strained ties with ONGC as the state-run firm look little interest in ONGC-Mittal Energy Services Ltd - the alliance for energy trading and shipping. These reflected in Mittal dumped OVL to acquire stakes in oil firms like CIR and Ophir Energy in regions that were exclusively reserved for OMEL to operate.