Glencore to supply crude to IOC from Sandesara Group’s Nigerian assets

Indian Oil Corporation (IOC) has tied up a deal with global trader Glencore to procure Okwuibome oil, which is produced by Sandesara Group in Nigeria.

Sandesaras’ privately held Sterling Energy and Exploration Production Company (SEEPCo) operates four blocks covering over 2,000 square miles in Niger Delta. The group is claiming to be the first Indian operator and oil producer in Nigeria.

According to reports, Glencore will supply 5 million barrels, including a million barrels of Okwuibome oil, to IOC’s subsidiary Chennai Petroleum Corporation. A group executive confirmed that SEEPCo sells its produce to Glencore that has tied up with IOC.

“SEEPCo has the potential to emerge as a promising Okwuibome oil producer for Indian refiners as more wells go online. Okwuibome is an established Brent crude oil grade, which attracts premium over market prices due to its popularity among refineries in the western world because of its low sulfur and sweet crude quality. Our assets also have potential to produce natural gas from,” the executive said, according to Economic Times.

He added that currently SEEPCo is producing 10,000 barrels of oil a day and has more than 250 million barrels of confirmed reserves and one TCF of natural gas.

Sandesara Group was in talks with ONGC Videsh Limited to sell 25-30 percent stake in select blocks to fund its expansion plans and offer India access to sweet crude. They inked confidentiality agreement early this year. The status of the negotiations is not known yet.

In 2005, SEEPCo won a reconnaissance license for OPL 277 in Nigeria and now aiming to acquire assets in other countries. Besides oil and gas, Mumbai based diversified Sandesara Group has interests in pharmaceuticals, healthcare, engineering and infrastructure.

By: FEMI ASU