Reports suggest that Indian oil companies that attempt to acquire overseas energy assets may find stiff competition from Asian countries like Japan and China.
Oil companies in Japan are said to be on a quest for upstream assets overseas, often with strong state support as the government tries to reduce reliance on atomic power after the Fukushima disaster.
China, which was a major crude oil importer from Iran, had to reduce reliance on oil from the Gulf company following the sanction imposed by the Western countries on Iran.
Indian oil companies want to acquire overseas oil assets in order to meet the soaring demand and also to diversify from Iranian crude imports lost to Western sanctions.
State-run ONGC Videsh agreed to pay about $5 billion for 8.4 per cent of the Kashagan field in Kazakhstan, the world’s largest oilfield discovery in four decades — which could boost its output by about 16 per cent within a year.
Should ONGC complete the purchase of the Kashagan stake — existing partners in the project have a right of first refusal on it — it could be working alongside Japan’s biggest energy explorer, Inpex, which has a 7.56 percent share.
The deal adds to a stable of assets that span some of the trickiest territories in the world — Sudan, Iran, Iraq, Syria and Libya among them — accumulated as parent ONGC struggled with domestic output.
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