Monday, October 17 2005 15:12 Hrs (IST) - World Time -

New Delhi: Petroleum Minister Mani Shankar Aiyar today (Oct 17, 2005) charged investment banker Goldman Sach with 'foul play' in the auction of PetroKazakhstan, saying India's ONGC Videsh-Mittal combine had bid higher than China's CNPC but the Chinese were given 'unfair' chance to revise their bid.

Aiyar alleged that ONGC-Mittal combine's 3.98 billion dollar bid was the highest when the bids for Kazakhstan's third largest oil producer closed on Friday August 19 but China National Petroleum Corp (CNPC) was allowed to revise its bid to 4.18-billion dollars on the following days and the sale was announced before office hours on Monday August 22.

"Goal posts were changed after the match started," he told reporters here.

"When you have a process of bidding by auction, and party A (ONGC-Mittal combine) comes up with the highest bid when it gets closed. In this case, however, party B (CNCP) was invited to submit a revised bid and party A was told that they too can submit a revised bid by such and such time. But before that time came, an announcement of sale was made," he said.

Aiyar said he had held talks with his Kazakh counterpart V Shkolnik on October 4 to see if Indian firms can be involved in PetroKazakhstan after the Kazakh government passes a new law allowing the state to intervene in the sale of oil assets to foreigners.

"When PetroKazakhstan gets restructured and a legal framework worked out, perhaps we can start talking about how we can acquire an Indian participation in assets run by PetroKazakhstan," he said.

Aiyar said the OVL-Mittal combine had time till tomorrow to make a revised bid.

Shareholders of PetroKazakhstan meet on October 18 to ratify the CNCP bid. As per the Canadian law, PetroKazakhstan will have to inform its shareholders of any better bid than CNCP made before the shareholders ratification.

"It is not for me to take the next course of action. It is for the concerned companies. I do not know (if the combine will rebid)," he said.

The Indians were clearly ahead of Chinese in the first round. The Goldman Sach, merchant bankers acting on behalf of the seller PetroKazakhstan, had even sought certain clarification on OVL-Mittal bid on Friday August 19. The Indians were to submit the clarifications on August 22 but the sale announcement came before that.

PetroKazakhstan made the sale announcement at 0730 hours London time, atleast a couple of hours ahead of the scheduled filing by ONGC-Mittal combine at the London office of the merchant banker.

PetroKazakhstan accounts for about 12 per cent of oil production in Kazakhstan and is the third largest oil producer in that country. It owns 500 million barrels of reserves, 150,000 barrels a day of crude output and a refinery in Kazakhstan.

State-owned KzaMunaiGas is the largest oil producer in Kazakhstan, followed by Chevron.