Oil India eyes overseas acquisitions

State-run Oil India Ltd has raised a war chest 1.5 to 2 billion dollars and is eying acquisition of small to medium sized oil producing companies overseas.

"There are companies who are facing cash problems because of the global economic meltdown. We are well placed with sizeable amount of fund and would like to use them to buyout these small to medium sized companies or any of their oil producing fields," Oil India Ltd (OIL) Chairman and MD N M Borah said here.

OIL, he said has over Rs 6,000 crore of cash surplus and is generating another about Rs 2,000 crore surplus every year.

"Yes, we are looking at certain companies or their assets. I would not like to divulge details at this moment as talks are at the sensitive stage," he said.

The Assam-based company is interest in exploration blocks in Egypt, Libya, Nigeria, Gabon, Iran, Yemen and East Timor.

Borah said the company has appointed US consultant PFC for suggesting an overseas acquisition strategy.

PFC would advice on the focus countries and the kind of assets OIL should be targeting.

"The report is expected in two months time," he said. OIL, currently, is the operator only in two properties overseas in Libya and Gabon.

It will drill its first exploration well in the Libya in the first half of 2009.

Domestically, the company is looking at 18 per cent growth in crude oil production at 3.5 million tonnes this fiscal.