India gets Sudan government, World Bank cover for oil deal
By Lola Nayar, Indo-Asian News Service
New Delhi, June 26 (IANS) India is protecting a controversial plan to secure oil equity in Sudan by making the country's government party to major investment guarantees and getting a risk cover.
"The Sudanese government is party to all major investment guarantees. Moreover, India and Sudan are slated to sign an agreement for promotion and protection of investment next month during the India-Sudan joint ministerial meeting," Sudanese ambassador Abdalmahood Abdalhaleem told IANS.
As a further protection measure, India is taking a risk cover from the World Bank-affiliated Multilateral Investment Guarantee Agency.
For India, which imports 70 percent of its crude oil requirement, Sudan could be a good source if security concerns are addressed.
"Sudan has one of the largest oil reserves. We invited India to join the exploration and production when the Greater Nile Petroleum Operating Company consortium was formed but India was preoccupied with other investments," Abdalhaleem said.
China National Petroleum Corporation holds 40 percent stake in the consortium, Malaysia's Petronas 30 percent, Canada's Talisman 25 percent and Sudan's Sudapet the remaining five per cent.
Talisman is discussing offloading its stake with Oil and Natural Gas Corporation Videsh Ltd (the overseas arm of Indian exploration major Oil and Natural Gas Corporation).
Last week the Indian cabinet gave the nod for the acquisition of the 25 percent stake in a $750 million deal.
The consortium project currently produces 12 million tonnes annually -- equal to what India's biggest oilfield at Bombay High yields. India's share in the production would be three million tonnes.
After the deal is finalised next month, the Canadian company would have to inform the Sudanese government formally about it, the envoy said.
Sudan also wants India to bid for oil concessions among several blocks offered for exploration and production along the Red Sea coast and the northwest region.
"We are looking at Indian companies stepping up investment in all areas, particularly independent power production and setting up refineries," Abdalhaleem added.
Bilateral trade between the two countries has increased four-fold since 1998-99 to over $200 million.
Several Indian majors like Kirloskar and Aptech have successful operations in Sudan.
"We also have lot of Indian investment in the sugar industry. The Kenana sugar factory, one of the largest in the world, has sent its project manager here to scout for boilers and meet sugar consultants," Abdalhaleem said.
Indo-Asian News Service
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