NEW DELHI: ONGC Videsh Ltd has entered into a definitive agreement to buy cash-strapped Australian company FAR’s stake in the $4.2-billion Rufisque-Sangomar offshore oil project of Senegal, marking its bid to buy into an asset in a distress sale prompted by the oil price crash.
But ONGC Videsh succeeds in breaking the four-year-long hiatus in acquisitions will depend on Woodside Energy, an Australian pioneer in LNG (liquefied natural gas) and the operator of the Sangomar project, waiving its first right of refusal in the next 30 days. Woodside has 68% in the project.
On Wednesday, ONGC Videsh said the definitive agreement is for buying FAR Senegal SSD SA’s 13.6% stake in the “exploitation area” (Sangomar project) and 15% in the “remaining contract area” (exploration area) of what is officially identified as Rufisque, Sangomar Offshore and Sangomar Deep Offshore block.
FAR is selling out to get out of a financial corner after defaulting on cash call for the project as its debt financing fell through in the wake of the oil price crash.
Capricorn Senegal Ltd, a subsidiary of Scottish explorer Cairn Energy, and Senegal’s national oil company Petrosen are the other partners in the block, besides FAR and Woodside.
