IOC and OIL had offered approximately $1.5 billion, which is $66 million more than the existing offer made by ENI of Italy.

The bid was placed through Burren Energy of the UK.

ENI is a minority partner in Congo assets and holds pre-emptive rights.

According to sources, Burren had previously shown sufficient interest in IOC-OIL`s offer and was considering to use its pre-emptive rights to help the Indian companies to acquire M&P's stake.

As per the proposal, Burren was expected to block an existing agreement between M&P and ENI for transfer of interests at a total consideration of $1.434 billion.

Burren, instead, withdrew from negotiations with IOC and OIL.

"Originally, Burren Energy, which had 31.5-per cent stake in M'Boundi field and 35 per cent interest in Kouilou, was opposed to M&P selling its stake to ENI. Burren wanted operatorship of the fields and was in advanced stage of talks to rope in IOC and its partner Oil India Ltd after it stops the sale by exercising pre-emption rights," reports quoting sources said.

IOC-OIL combine had no problems with Burren taking over operatorship and they had even agreed to assign a portion of M&P stake to the UK firm. But, Burren reached an agreement with ENI earlier this week wherein the Italian firm will retain the operatorship.

M&P holds 48.6-per cent stake in M'Boundi oil field and 66 per cent in Kouakouala- A oilfield in Congo. The oil fields hold 1.4 billion barrels of in-place reserve and produce high-quality oil. The company holds 50 per cent operating stakes in the Kouakouala (B, C, D) and Kouilou exploration blocks.

ENI will sell 5.5 per cent out of the 48.6 per cent M&P stake it is acquiring in 56,000 barrels per day M'Boundi oil field and two per cent out of the 50 per cent M&P interest it is taking over in the surrounding Kouilou exploration licence for $154 million.