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OIL To Tap Overseas Mkts To Fund Mozambique Block Buy

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State-run explorer Oil India expects to raise 80-90 per cent of the $1 billion it has agreed to pay for a stake in a Mozambique offshore gas block through overseas debt, its chief financial officer said on Monday. The company has not yet decided the instruments it will tap to raise the debt, T.K. Ananth Kumar told reporters.

Last week, state oil firms ONGC and Oil India agreed to buy a 10 per cent stake in Rovuma Area 1 block off Mozambique's coast from India's Videocon Group for $2.48 billion. Oil India will pay $1 billion for a 4 per cent stake, while ONGC Videsh will hold the balance.

Anadarko Petroleum Corp, the operator of Rovuma's Area 1 block, in which it holds a 36.5 per cent stake, and Videocon had each launched an auction of a 10 per cent stake in the block earlier this year.

Ananth Kumar said ONGC's overseas business unit was in talks to buy Anadarko's 10 per cent stake, and Oil India was not in the fray for the same. Sources told Reuters last month the two Indian companies had also made a bid for Anadarko's 10 per cent stake.