KOLKATA (miningweekly.com) - Indian Oil Corporation Limited (IOC), the country’s largest oil refiner and marketer with predominantly domestic operations, planned to acquire oil exploration and production (E&P) assets overseas.

As a majority government-owned oil company, IOC has sought government approval to invest over $800-million in acquiring E&P asset overseas, particularly equity stakes in shale gas and liquefied natural gas resources, a company official said.

Over the past year, the oil refiner had set aside a corpus of around $1-billion to fund such acquisitions but the government’s approval would be necessary prior to any board level decision on such acquisitions, the official added.

An Empowered Committee of Secretaries, comprising representatives from the Foreign Affairs, Law, Finance and Petroleum Ministries had been constituted to scrutinise and approve the proposal that the IOC expand overseas, the official said.

While awaiting the government’s nod, IOC was already in talks with Petronas, in Malaysia, to acquire a 10% equity stake in the latter’s shale gas assets in Canada. The Malaysian oil major was seeking around $1.5-billion for hiving off a 10% equity in Progress Energy Resources Corporation, through which Petronas held its Canadian shale gas assets.

The focus on foreign asset acquisition would be on the US, Canada, Africa and Australia, the official said, adding that the company’s board had approved floating a wholly owned subsidiary company to exclusively focus and fund overseas assets while simultaneously limiting IOC liabilities and risk involved in foreign oil and gas assets, the official said.

IOC’s current overseas portfolio includes nine oil blocks in Libya, Gabon, Nigeria, Timor-Leste, Yemen and Venezuela.

IOC and its group companies operated 10 of India’s 22 oil refineries with combined capacity of 65.7-million tonnes a year, including a countrywide oil and crude transportation pipeline spanning 11 214 km and 10-million standard cubic feet a day of gas.