RIL says Niko can raise KG block stake to 13 per cent
22 February 2011
Close on the heels of its sale of 30 per cent equity stake in 23 oil and gas blocks in a $7.2 billion deal, Reliance Industries has now offered its partner Canada's Niko Resources a 30 per cent increase in its current stake in all or any one of the KG D6 and D4 blocks and the NEC 25 block in the Orissa basin.
Niko, which currently has a 10 per cent stake in the KG D6 and D4 blocks, can raise its stake to 13 per cent while it may raise stake in the NEC 25 block off the Orissa cost from 15 per cent to 19.5 per cent, Reliance said in a statement.
Reliance said it has informed Niko of the new relationship with BP and that Niko is expected to review the new opportunity over the coming weeks.
"Niko Resources was informed about our partnership with BP. As per the contractual provision, Niko can increase by 30 per cent of their current holdings," Reliance said in a statement.
With the sale of 30 per cent stake to British Petroleum, RIL will be left with a 60 per cent stake in blocks where its partner Niko Resources of Canada also has 10 per cent holding, and 70 per cent in the rest of the blocks.
The sale of an additional 3 per cent stake would leave Reliance with a 57 per cent stake in the KG block.
Niko Resources has participated in most of the New Exploration Licensing Policy (NELP) rounds of auction of oil and gas blocks by the government and three of these blocks are producing and comprise the majority of the company's production.