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Government-owned ONGC Videsh Ltd's (OVL) purchase of 25 percent equity in a crude oil producing field in Sudan is finally through after some arm-twisting by the Khartoum government. Sudanese ambassador to India, Abdalmahood Abdalhaleem, confirmed that the agreements were signed today between the project promoters and the Sudanese government allowing OVL to acquire the share in Greater Nile Oil Project from Canada's Talisman Energy.
However, he declined to comment on his government's pressure tactics in clinching the issue for OVL. ''All I can say is that the mood in Khartoum is very jubilant as we would be restarting economic partnership with our long-time ally, India.'' OVL will pay Talisman $720 million for the stake and will receive three million tonnes of crude oil each year as equity oil from the block.
The acquisition, first signed between OVL and Talisman in October, should have been ratified by January 6 but got delayed as China National Petroleum Corp and Malaysia's Petronas - the other partners in the Greater Nile Oil project - staked their claim to buy Talisman equity at the price negotiated by OVL. Sources said CNPC was willing to waive its Right of First Refusal and give consent to OVL's entry into the project provided Petronas also withdrew its claim. But Petronas continued insisting on buying 10 percent of Talisman's equity to reach CNPC's share level of 40 percent. It was only after Sudan Government threatened Petronas that it relented.
According to sources, Sudan's Minister for Energy and Mining Dr Awad Ahmed El Jazz told Petronas that its positive image would be affected if it persisted with its demand. In a meeting with Petronas President during his visit to Kuala Lumpur for the NAM summit, Dr Awad warned that the Malaysian firm could lose out on new business opportunities if it continued to oppose OVL's entry. That prompted Petronas to send a letter to Sudan government on Thursday confirming that it would not exercise its first right to buy equity. CNPC submitted a similar letter last week, sources said.
Talisman is moving out of the oilfield as it has been under fire from rights groups that the revenue from the field was being used to fund the civil war.

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