New Delhi: Steel baron Laxmi Mittal's acquisition of 49 per cent stake in Hindustan Petroleum's $3 billion Bhatinda refinery has violated his pact with ONGC to pursue hydrocarbon opportunities.
Mittal inked a joint venture agreement in July 2005 with the state-run firm to form ONGC-Mittal Energy Ltd for acquisition of oil and gas fields, refinery business and LNG projects, but recently he decided to go it alone in investing Rs 3,300 crore in the Bhatinda refinery.
However, Mittal has on his own bought 50 per cent stake in a Kazakhstan oil firm from Russia's Lukoil for 980 million dollars and acquired three per cent stake in the $6 billion Chevron-operated Olokola LNG (OK-LNG) project in Nigeria.
"The July 24, 2005 agreement had earmarked 27 countries for exclusive pursuit of hydrocarbon opportunities by OMEL. For the rest of the world, it clearly stated that Mittal shall offer ONGC Videsh Ltd a partnership in any venture or business opportunity it wishes to undertake in the hydrocarbon sphere," PTI quoted ONGC official as saying.
But there was no such restriction placed on ONGC, he said, adding Nigeria and Kazakhstan fall under the 27 exclusive countries marked for OMEL.
Clause 2.4 of the 2005 agreement reads: "In the event Mittal or any of its affiliates is desirous of undertaking any venture or business opportunity in the hydrocarbons business in areas other than the Territories (27 countries), Mittal shall invite OVL, to the extent permissible and in the manner and with such information about such venture or business opportunity as it deems fit, to participate in such venture or business opportunity together with Mittal."
With agency inputs
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