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Petronas of Malaysia and CNPC of China have cleared the way for ONGC Videsh to acquire Talisman Energy Inc's 25 per cent stake in a Sudan oil field for $720 million.

"Petronas and CNPC on Sunday signed an agreement with Sudan waiving off their pre-emption right," informed sources said here on Monday. With this, OVL, the overseas arm of ONGC, will now make payment of $720 million plus interest from September 1, 2002 to Talisman and sign the final farm-in-agreement.

While Sudan had supported the Talisman's sale to OVL, the deal could not be completed as partners in the Greater Nile Oil Project - Petronas (30 per cent ) and CNPC of China (40 per cent ) - exercised their first right of refusal. Sudan's state firm Sudapest holds the remaining 5 per cent in the project.

India would get 3 million tonne crude oil annually from the stake in the producing field, sources said, adding OVL would take over all the 80-odd employees of Talisman to step into the Canadian firm's job of managing the 1,500km pipeline connecting the producing fields to Port Sudan on the Red Sea.

Talisman's share of revenue from the sale of oil produced from Greater Nile project is being escrowed to OVL account from September 1, 2002, the date on which the sale price of $720 million dollars was frozen. OVL would pay interest on $720 million from September 1 till the payment is made, sources said, adding OVL will make cash payments to Talisman in April.

ONGC, which has put in place a team headed by A.K. Mehra to take over Talisman's operations, is exploring shipping the light crude oil products from the Sudan field for processing at its latest acquisition, Mangalore Refinery and Petrochemicals.

"For an initial period of three four months, the existing contracts would be honoured to sell India's share of crude. By then MRPL would be configured to process Sudan crude, " sources said. The Greater Nile Project consists of four blocks in the Muglad basin and a 1,500km pipeline from the producing fields to Port Sudan on the Red Sea. It currently produces 12 million tonne oil annually (240,000bpd) from the 600-1200 million barrel Heglig and Unity fields.

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