Debt Restructuring of Essar Oil and Gas Exploration and Production Limited amounting to USD 198 million

  • Deal
  • January 19, 2023

JSA advised and assisted the pool of lenders comprising of Axis Bank Limited (Indian branch), Yes Bank Limited (Indian branch), Indian Overseas Bank (Indian branch), Axis Bank Limited (GIFT City branch) and India Infrastructure Finance Company (UK) Limited (“Lenders”) in relation to implementation of the resolution plan (by way of debt restructuring) for resolving the Indian rupee and foreign currency debt availed by Essar Oil and Gas Exploration and Production Limited (“EOGEPL”). The debt was originally availed by EOGEPL from the Lenders for development of the Raniganj CBM (Coal Bed Methane) block (“CBM Raniganj Block”), located in the Burdawan district of West Bengal, India. The total debt resolved under the resolution plan comprised of foreign currency loans for an aggregate amount of USD 82.05 Million (approx.), and Indian rupee loans for an aggregate amount of INR 976.60 Crores (approx.).

EOGEPL was awarded the CBM Raniganj Block in July 2002. Since then, EOGEPL has developed over 348 CBM production wells in the CBM Raniganj Block, along with an extensive network of infield pipelines, spread over 300 km, connecting the wells to four gas-gathering stations in the state of West Bengal. The facility is capable of handling over 2 MMSCMD of gas which, EOGEPL aims to progressively increase to 3 MMSCMD to cater to the projected production from the CBM Raniganj Block. EOGEPL is a significant fuel supplier for the region and provides gas feed to many industries. Furthermore, EOGEPL has also entered into a 15-year CBM gas sale and purchase agreement with GAIL (India) Limited, for sale of CBM gas up to 2.30 MMSCMD, being produced from the CBM wells. EOGEPL will be supplying this gas to GAIL and other industries through the 350-km Dhobi-Durgapur stretch of the Urja Ganga Pipeline, which was commissioned in May 2021.

Irwin Mitchell LLP and YKJ Legal acted as English law counsel and Mauritian Law counsel, respectively, to the Lenders. Samvad Partners acted as the counsel to EOGEPL

Deal Value: Approx USD 198 Million

Our Banking and Finance Team Comprised Lead Partner – Dina Wadia, Partner – Nand Gopal Anand, Senior Associate – Harshit Dusad, and Associate – Vrindesh Patel