Essar and Petrom wait for return of $2m bank guarantee

Vol 7, PW 5 (21 May 03) News in Brief

Essar Oil and Petrom of Romania are waiting for the return of their $2m bank guarantee, two months after they returned Mumbai offshore block BB-OS/5 to the government.

Why the delay Differences between ONGC and the consortium over the interpretation of Article 27 in the PSC concerning surplus equipment such as brand new drill bits, casings and shoe casings worth $150,000. ONGC says 'free of charge' means 'free of cost' while the consortium says they mean 'free of encumbrance'.

ONGC wants them free of cost, but the consortium is unwilling to play donor. The DGH is the arbiter in such cases, but the issue is being tossed around between itself and ONGC, with neither wanting to make a commitment.

Meanwhile, Essar and Petrom are still waiting for their money.