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Home > Business > PTI > Report

Mittal to pay $980 mn for Kazakh oil firm pie

December 13, 2006 16:51 IST

India-born billionaire Lakshmi Mittal will pay Russia's Lukoil $980-million (Rs 4,410 crore) to buy 50 per cent stake in a Kazakhstan oil firm and may later transfer it to ONGC-Mittal Energy Ltd, his venture with state-run Oil and Natural Gas Corp.

Separately, OMEL plans to give Total of France and Royal/Dutch Shell a stake in its two Nigerian deep-sea blocks.

"Mittal Investment will buy 50 per cent stake in the Russian company's wholly owned subsidiary in Kazakhstan, Caspian Investments Resources. If approved by local authorities and Lukoil, the acquisition will go to OMEL at a later stage," an industry official said.

Late last year, Caspian Investments Resources served as the vehicle for Lukoil's purchase of Nelson Resources, a Canadian firm with assets in Kazakhstan.

The deal with Mittal Investments, planned for completion in early 2007, also covers debt of $160-million held by the venture. Caspian Investments Resources has reserves totalling 270 million barrels of crude.

The official said OMEL will give Total of France 18 per cent stake in Block 279 and 26 per cent in Block 285 in Nigeria, the only country where the joint venture between the world's largest steel producer and state-run ONGC has been successful till date.

Shell will also be roped in as a partner in the block with 10-15 per cent stake, he said.

OMEL had agreed to pay $50 million to the Nigerian government for Block 285 and $65 million for Block 279. Total and Shell will have to bear this payment in proportion to their shareholding.

As part of deal with Total, OMEL will have the right to take a stake in the French company's Block 215.

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