Oil India, Engineers India to jointly bid for BPCL's stake in Numaligarh Refinery
NRL is the largest customer of OIL’s crude produced from its North Eastern fields. The deal is likely to happen before the privatisation process of BPCL is over.
February 18, 2021 / 08:29 PM IST
State-run Oil India (OIL) and Engineers India (EIL) have decided to jointly bid for acquiring Bharat Petroleum Corporation's (BPCL) stake in Numaligarh Refinery (NRL).
The companies said in a statement on February 18 that a bid will be submitted through a formal process. "The exact percentage of the stake of OIL and EIL will depend on the extent of Right of First Offer (ROFO) to be exercised by Government of Assam which already holds 12.35 per cent stakes in NRL," said an OIL statement.
Last year, the Assam government had given a no-objection certificate to the NRL deal on condition that another 13.65 per cent stake in NRL will be sold to the state. This will increase the state government's stake in the company to 26 per cent.
At present, BPCL holds 61.65 per cent and OIL another 26 per cent in NRL. OIL and EIL had approached the BPCL management and the Department of Investment and Public Asset Management (DIPAM) stating that the companies are keen to acquire around 48 per cent stake in NRL. This is likely to cost around Rs 5,500 crore. Out of this 48 per cent, EIL is expected to hold 10 per cent. This would take OIL stake in NRL to 64 per cent.
NRL is the largest customer of OIL’s crude produced from its North Eastern fields. The deal is likely to happen before the privatisation process of BPCL is over. The sale of BPCL is expected to be key in achieving the Rs 1.75 lakh crore disinvestment target set for the upcoming financial year. Already, Anil Agarwal-led Vedanta Group and private equity players like Apollo Global, and I Squared Capital have expressed their interests in BPCL.