Essar Energy sells 50 % stake in Vietnam gas block to ENI

Essar Energy plc, the India-focused integrated energy company, today announced that its subsidiary Essar Exploration & Production Limited has agreed to sell a 50-per cent stake in Vietnam's offshore gas exploration block 114 to Italy's ENI International BV.

The company did not disclose financial details of the deal.

Block 114, located in shallow waters off the coast of Vietnam, has undiscovered inplace gas reserves of about 1 trillion cubic feet of gas, according to Essar Energy's web site.

Essar Energy acquired 100 per cent stake in block 114 in 2007 and had since signed a production sharing contract with the Vietnam government in 2010.

The reduction in Essar Energy's stake in block 114 is in line with the strategy for its exploration and production business of introducing strategic partners to help manage risk and of focusing on the development of its core assets, the company said in a release.

Essar Energy said further investment would be required to establish gas reserves in the block and no gas is being produced at present.