ONGC not to revise Imperial bid amid falling fuel rates

ONGC not to revise Imperial bid amid falling fuel rates

New Delhi: “Oil and Natural Gas Corporation (ONGC) will not revise its $2.59 billion bid to acquire UK-listed Imperial Energy because of fall in oil prices and despite global financial turmoil, company has enough liquidity to fund the transaction," Chairman RS Sharma said.

“No, we don’t foresee revision in the bid (because of fall in oil prices)," he said.

International oil prices averaged around $115 to $120 a barrel in August when ONGC made the 1,250 pence a share successful bid to acquire Imperial that has oilfields in Russia. The crude oil prices have since fallen below $70 a barrel. Crude prices decide the value of acquisitions in oil and gas sector as they indicate the monetary value of the reserves in ground.

Sharma further said that the company had enough liquidity to fund two more such transactions.

“We are zero debt company. We do not rely on borrowings for our investment plans. We have adequate liquidity to meet our requirements," he said, adding that the global financial crunch would have a very limited impact on ONGC.

For Imperial ONGC had arranged for a $1 billion bridge loan to boost confidence. “If situation arises (where foreign debt is not available), we have liquidity available (to fund the acquisition).

ONGC had not slowed down on overseas acquisition because of slide in crude oil prices. “We have not slowed down. We in fact feel it is suitable time for stepping up the ante," he said, adding the company at any given point of time would be looking at 6-10 opportunities.

He however refused to elaborate on the opportunities.