Shirish Nadkarni
OGJ Correspondent
MUMBAI, June 16 -- State-run Indian Oil Corp. (IOC) and Oil India Ltd. (OIL) are to spend $27 million each in picking up 12.5% equity stakes from Reliance Industries as farm-in partners in the latter's offshore oil block in East Timor.
The two Indian companies have approached the East Timor government for formal approval.
Reliance, which had won the block in area "K" of East Timor in May 2006, will continue to hold the majority stake and operatorship in the block spread over 2,384 sq km. The block is purported to have proven reserves in the Australian North West Shelf. The region contains discoveries such as Bayu-Undan (which commenced production in 2004) and Greater Sunrise.
Although the consortium of IOC and OIL has been working in acquiring hydrocarbon assets abroad, this is the first time the two have joined with Reliance.
Under the first phase, covering 3 years of exploration activity, the companies will shoot 3D seismic surveys and drill one exploratory well.
