GVK Power will seek a partner for oil & gas

Infrastructure major GVK Power & Infrastructure Ltd is likely to rope in a partner for furthering its plans for tapping the potential in oil & gas sector.

The company has already won seven deepwater oil and gas blocks under the NELP VII on the west coast in 2008. The company has partnered with the Australia-based global resources company BHP Billiton.

“We are working on a plan. We have a meeting shortly and we will decide on the future plan during the meeting,” G V Krishna Reddy, the GVK group chairman, said.

Reddy was not willing to divulge the desired plan of action for furthering the oil and gas foray.

“We have a partner (BHP-Billiton). We have to decide jointly. For now, work is in progress. It is a long-term project. We can’t do it just like that...Our partner is doing some work on seismic data analysis. It is in progress at Houston in the US,” he said.

Sources, however, said the focus has been on development of the allotted blocks and funding the further exploration. “There are several options including roping in a partner either through fresh equity or by one of the partners divesting a part of the equity. Nothing can be confirmed at this point,” the source said. GVK-BHP Billiton consortium has been awarded seven deepwater blocks under the New Exploration Licensing Policy (NELP) VII.

Of the seven blocks, one is located in the Kerala-Konkan region and the rest of the six deepwater blocks off Mumbai. GVK has estimated a capital outlay of `220 crore over the next three years. Though it is too early for the group to count on the findings of its seismic survey of the blocks for finalising the expansion of its power generation capacities, sources said it was a gamble of sorts. “If it works, it works fully and the group will have an aggressive roadmap in the power sector. Otherwise, it is a risk,” the source said.