Oil India Ltd (OIL) in consortium with Engineers India Ltd (EIL) has decided to bid for acquiring a 61.65 percent stake of Bharat Petroleum Corporation Ltd (BPCL) in Numaligarh Refinery Ltd (NRL).
The bid is to be submitted through a formal process. The exact percentage of the stake of OIL and ElL will depend on the extent of the right of the first offer to be exercised by the state government of Assam which holds a 12.35 percent stake in NRL.
Last year, the Assam government had given a no-objection certificate to the NRL deal on the condition that another 13.65 percent stake in NRL will be sold to the state. This will increase the state government’s stake in the company to 26 percent.
NRL is the largest customer of OIL’s crude produced from its northeastern fields. The acquisition is expected to improve synergy in OIL’s portfolio, it said in a statement.
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 new financial year beginning April 1 (FY2021-22).
OIL, a navratna public sector undertaking, is a fully integrated exploration and production company in the upstream sector and is the second-largest national oil and gas company in India as measured by total proved plus probable oil and natural gas reserves and production.
It is engaged in the business of exploration, development and production of crude oil and natural gas, transportation of crude oil and production of LPG. The company already has a 26 percent stake in NRL.