Industry & Economy
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Petroleum
IOC threatens to set up overseas investment arm
Our Bureau
New Delhi
,
Nov. 14
IOC has threatened to set up a wholly owned overseas investment vehicle if the Government rejects the plan to replicate the successful ONGC Videsh Ltd with participation from the other Government-controlled downstream majors or give it a stake in OVL, a subsidiary of ONGC.
ONGC is not keen on taking on board any of the marketing companies. In a recent meeting convened by the Petroleum Minister, Mr Ran Naik, senior IOC officials conveyed their intentions.
They were miffed at the fact that ONGC was allowed into the downstream refining business through acquisition of MRPL while they were only offered participation in overseas acquisitions on a case-to-case basis.
IOC, HPCL, BPCL and GAIL have been petitioning the Government for entry into the overseas exploration and production projects.
GAIL, meanwhile, has been complaining about OVL's investments in gas blocks.
At the meeting, the ONGC chief and OVL Chairman, Mr Subir Raha, made it clear that he was not willing to offer equity in OVL to the other companies.
Then, the issue of floating `OVL II' was discussed. OVL II would involve participation by the oil marketing companies, GAIL and ONGC for investments in new projects.
This again met with resistance from ONGC, which was not willing to budge from its position of offering equity in projects on a case-to-case basis.
The Minister said that there must be one face of Indian investments in the overseas petroleum business.
With these contrasting positions and no solution in immediate sight, the Petroleum Secretary has sought time from the oil companies to work out a solution.
IOC is miffed at the fact that it was given a minority role in a pipeline and refinery project bagged by OVL in Sudan.
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