Norsk Hydro seeks 30-per cent stake in ONGC gas block

25 August 2008

Mumbai: Norsk Hydro of Norway is seeking to hike its stake in Oil and Natural Gas Corp's gas discovery block in Krishna Godavari basin to around 30-per cent from the current 10 per cent it holds.

Norsk Hydro has the right to double its interests in the KG-DWN-98/2 block before the gas discoveries are put to production, ONGC sources said.

State-run explorer ONGC has agreed for a joint operatorship of the block, but is willing to give only 22-24 per cent stake to Norsk Hydro.

ONGC, which needs deep water production technology for the project, may have to agree to an increased equity stake for the partner, sources said.

Besides Norsk Hydro, Petrobras of Brazil has 15 per cent stake in the block, which is close to Reliance Industries' D6 block, while Cairn India has 10 per cent.

Petrobras too has right to double its stake to 30 per cent. Sources said, in the event of Norsk Hydro being given 30 per cent and Petrobras also doubling its stake, ONGC would be left with just 30 per cent stake and would be on equal footing with the Norwegian and Brazilian companies.