OIL lines up $1 bn for acquisitions

Oil India Ltd (OIL) has lined up a war chest of Rs4,000-5,000 crore, for the acquisition of a producing oilfield abroad for which it is scouring major oil-producing regionss, chairman N M Borah said today.

According to OIL director (finance) T K Ananth Kumar, the company has a cash balance of Rs12,700 crore, most of which would go into its current operations. He added that for inorganic growth, the company could go up to Rs4,000-5,000 crore (spending) and also borrow if required.

OIL, which is the country's second-largest explorer after ONGC, is on the lookout for a medium-sized oil properties that are already in production to supplement its present operations.  

Borah said the company was looking in Southeast Asia, Africa, South America, Australia and the CIS and into some properties but at this point in time he would not be able to specify which company OIL was acquiring. The company reported a 30 per cent increase in its fourth quarter profit in spite of its fuel subsidy burden.

OIL net profit rose 30.5 per cent at Rs562.6 crore in the last quarter of the previous fiscal year ended 31March despite a 140 per cent jump in subsidy outgo to help state-run oil marketing companies in keeping prices of diesel, kerosene and cooking gas below market rates, according to Borah.

The company grossed an annual profit for 2010-11 of 2,887.73 crore registering a 10.62 per cent growth.