08 July 2014, News Wires – India’s Oil & Natural Gas Corporation (ONGC) has raised more than $.2.2 billion in a bond sale to help pay for the company’s offshore asset purchases in Mozambique, according to a report.
The state-owned player sold bonds in two currencies with three different tenures to finance overseas arm ONGC Videsh’s two splurges in Area 1 last year, the Press Trust of India (PTI) reported.
ONGV sold $1.5 billion-worth of bonds in two tranches of $750 million each, with terms of five and ten years. It also sold €525 million ($713.65 million) of seven-year bonds, PTI reported, citing finance sources. This equates to a total of around $2.21 billion.
The bond sale was the largest ever undertaken in India, PTI said, with the dollar and euro sales $6 billion and €1.8 billion oversubscribed, respectively.
Last summer ONGC Videsh and OIL India jointly acquired a 10% stake in the gas-rich Area 1 off Mozambique from compatriot Videocon for $2.475 billion.
Just two months later ONGC Videsh struck a $2.6 billion, all-cash deal with Anadarko Petroleum for the US independent’s 10% stake in Area 1.
The huge volumes of gas in Area 1 are being developed as feedstock for the Afungi liquefied natural gas plant, which is due to come on stream in 2018.
ONGC Videsh said last year its involvement in the block would help provide LNG to India at competitive prices, while Anadarko has previously cited India as a key market for LNG from Area 1.
“The Area 1 LNG project is strategically located to supply LNG to India at a competitive price. Participation of Indian public sector utilities in the project will facilitate access of LNG to the growing Indian gas market,” ONGC Videsh in August.