‘ONGC moves to acquire oil company active in Russia’

July 15th, 2008 - 8:11 pm ICT by IANS  

New York, July 15 (IANS) Indian public sector petroleum company Oil and Natural Gas Corp (ONGC) has made an approach to acquire Imperial Energy Corp, a London-listed company focussed on Russia, Wall Street Journal (WSJ) reported Tuesday quoting people familiar with the matter. Imperial Energy said in London Monday that it has been approached by an unnamed party. Its shares rose 18 percent to $18.10 after the announcement.

ONGC, a Fortune 500 company, has said it is looking to expand its overseas operations, especially into Russia and other eastern European countries. But its spokesman declined to confirm or deny that the company approached Imperial, WSJ said.

The financial daily quoted an analyst at UniCredit investment bank, Artyom Konchin, saying that Imperial stock was valued quite cheap and was expected to be sold at a premium.

However, noting Russia’s recent stance toward foreign investments in its energy sector, he said: “I’m not entirely convinced it will be as simple as that. In Russia it’s not just a matter of ONGC making an offer and buying the company.”

In November, Imperial declined an offer from the banking arm of Russia’s state-owned gas firm OAO Gazprom, which had been seeking a 25 percent stake.

Imperial’s shares have been volatile recently as the company has been seeking funding in the financial markets.

Since 2006, its reserves have grown sharply as the company has started an exploration and production programme and made capital investments in the Tomsk region.

Imperial produced an average of 10,000 barrels a day at the end of 2007 and is aiming for 25,000 barrels a day by the year end, the paper said.

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