A MYSTERY BUYER FOR ENRON OIL & GAS

Vol 3, PW 1 (03 Feb 99) Exploration & Production
     

Who is the mystery suitor stalking Enron Oil & Gas (EOG) Thats the question everybody is asking on news that the company is to be sold by its parent, Enron Corporation.

One rumour coming out of Mumbai has it that Occidental is the "unsolicited third party" which made an approach in December last year. Both Enron and Oxy strenuously refuse to confirm or deny the report.

A statement from Enron reads: "An unsolicited third party has indicated an interest in purchasing EOG and has begun its evaluation process of EOG assets in anticipation of making an offer. EOG has formed a Special Committee of its Board of Directors to evaluate this potential offer and any other offer that may be forthcoming.

The process is in its early stages and there is no way to know at this time whether this offer or any other offer will be acceptable and that a transaction will be consummated, or that there will be a significant impact on EOG's oil and gas production operations offshore India". Enron tells this report it expects several companies to come forward with offers.

In India, developments will be watched closely by Reliance Petroleum and ONGC, Enrons joint venture partners for the Panna/Mukta/Tapti oil and gasfields on the Bombay Offshore. One report suggesting ONGC or Reliance may emerge as interested bidders for Enrons India assets is misleading.

It is highly unlikely that Enron Corporation wants a buyer for just its India assets. It is looking for a buyer for Enron Oil & Gass global assets.

No Indian company could afford to put up the money for that. EOG is a separately traded public company on the New York Stock Exchange with 47% of its shares held by individual investors and institutions.

Enron Corporation holds the balance 53%.