Indian group in talks with BP on Vietnam assets

India’s largest oil group is in talks with BP to buy its Vietnamese assets as the UK company works towards the $10bn of sales it has targeted in the wake of the Gulf of Mexico oil spill.

R.S. Sharma, chairman of the state-owned Oil and Natural Gas Corp, told the Financial Times that he would be in Hanoi on Wednesday with Murli Deora, India’s oil minister, to discuss the deal with the Vietnamese authorities and PetroVietnam, the state oil company. He said the matter would also discussed with David Cameron, the UK prime minister, on his official visit to New Delhi next week.

“BP has given its intention that they want to sell their stake in the Vietnam oilfield and we are discussing with them a way to reach a deal,” said Mr Sharma. “We will be talking with Cameron and his team . . . the [Indian] government is fully backing this deal.”

BP intends to sell all of its assets in Vietnam and Pakistan, except for its lubricants business, in its drive to raise $10bn to help pay for the Gulf oil spill clean up and compensation.

The Vietnamese assets are valued at about $966m and the Pakistan business at about $690m, according to UBS. ONGC said it was only interested in Vietnam, where it already has interests.

BP has been operating in Vietnam for more than two decades and its flagship asset is the Nam Con Son gas project in the South China Sea, in which it has a 35 per cent interest in two fields, with ONGC holding a 45 per cent stake and PetroVietnam owning a 20 per cent stake.

BP has a minority stake in the 371km Nam Con Son pipeline connecting the field to onshore terminals, and controls a third of the Phu My power plant.

“We would welcome interest from any parties and we’ll work towards a deal hopefully by the end of the year,” said BP, which declined to comment on ONGC’s interest.