IOC, OVL to acquire stake in Tullow’s $3.5bn project

New Delhi: Flagship refiner-retailer IndianOil has roped in ONGC Videsh (OVL), the overseas investment arm of state-run explorer ONGC, to revive talks for buying a stake in Tullow Oil’s Lokichar oil field in Kenya in a deal size seen at more than $2 billion, if finalised.
Sources said senior executives from the two Indian entities are in Kenya on an exploratory mission. The mission’s findings will decide whether IndianOil and OVL decide to proceed to formalise a proposal.
The sources said IndianOil had in March shown some interest in acquiring stake in the project, the size of which was then estimated at $3.5 billion. But those initial contacts with Tullow withered – perhaps because of the project and investment size. This explains IndianOil roping in OVL, which brings on the table expertise in operating oil fields.