Indian consortium pulls out of bidding war for Cove Energy

City A.M. Reporter
AN INDIAN consortium said yesterday it was no longer considering making an offer for Cove Energy, confirming the battle for the Mozambique-focused explorer is a two-horse race between PTT and Shell.

India’s Oil and Natural Gas, through its Videsh unit, and GAIL India said in February they had teamed up to look at making an offer for Cove before saying yesterday, after three months of silence, that they were no longer mulling a takeover approach.

The withdrawal of the Indian consortium leaves Shell and PTT vying for Cove, with the latter currently in pole position.

PTT’s £1.2bn, 240p per share offer for Cove is higher than Shell’s, although a number of analysts expect the oil major to return with a higher bid, possibly before the first closing of PTT’s offer on Friday.

At stake is access to East Africa’s huge gas resources through Cove’s 8.5 per cent ownership of a block off the coast of Mozambique. East Africa is set to become one of the world’s largest gas exporters to Asia, after a string of discoveries across Mozambique and Tanzania.