Page 9 - AsianOil Week 11 2023

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Indian Oil Corporation to take over

Mumbai’s Mercator Petroleum

MUMBAI MUMBAI-BASED Mercator Petroleum (MP) publicised Mercator collapse over a period of
saw a vote put to its lenders last week given several years, leading to claims against the com-
Mercator has been in unanimous approval, with the result being the pany of at least $35.4mn.
dire financial straits for one-time household name, in all but name only, It is suspected this figure could increase as
the past few years. being taken over by the state-owned energy giant further details of unknown business operations
Indian Oil Corporation (IOC). are revealed in the coming days.
A firm in dire financial straits for the past few Full issues surrounding claims owed and fees
years, MP just weeks ago saw its securities sus- payable are still being finalised in Mumbai, but
pended as liquidation proceedings were ordered with the IOC just one of a trio of agencies look-
by a court in the firm’s home city of Mumbai. ing to take over the once hugely profitable firm,
This in turn led to a rare move by a govern- interest does remain in former Mercator gas and
ment body in India taking the necessary steps to oil interests around India at the very least.
acquire a publicly traded company. Most prominent amongst these is a major
The action by IOC was taken under the block in the Cambay Basin in the state of Gujarat
authority of the government’s Insolvency and in the north-west of the country.
Bankruptcy Code (IBC), according to sources The Cambay field is believed to contain up
in New Delhi familiar with the case. to 930bn cubic feet (26.3bn cubic metres) of gas
As a result, it is understood the deal with IOC and an estimated 61mn barrels of condensate
has now seen a recovery of losses to the tune of across the whole site.
at least 46% for those left out of pocket by the At present, the Mercator block in the basin
suspension in securities. is known to be awaiting development, having
Mercator employees too, as well as trade cleared all administrative hurdles, meaning that
related creditors, will also now benefit from a two existing wells on site could start commercial
$607,000 payout by IOC, some local media are operations in the very near future.
now saying. Storm clouds had been gathering for some
At least one media source in the country has time for Mercator’s parent company Merca-
also reported that the IOC takeover will include tor Limited, with a number of insolvency and
the stipulation that the state is willing to share winding-up cases making headlines in recent
earnings brought about as a result of future gas years; subsidiary closures in Singapore and
and oil ventures for a period of 15 years. No firm efforts to sell ocean-going tankers of late have
details have been released as of yet on how this been attracting media attention for all the
will be facilitated. wrong reasons.
Business media in India have, however, now Still listed in India as the second-biggest ship-
indicated that this action will push personal rates ping company in the country, until 2010, Merca-
of recovery to somewhere significantly north tor was once known throughout Asia as one of
of the initial 46%, albeit not immediately. This the most profitable oil and gas exploration firms
ultimately depends on court proceedings in the on the subcontinent.
meantime. Online links to the firm’s homepage, however,
Triggering the court moves and subsequent now lead to a website auction page signalling just
IOC takeover was a slow-motion and highly how far India’s gas and oil giant has fallen. ™

Week 11 17•March•2023 www. NEWSBASE .com P9