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Our Bureau

New Delhi , March 30

THE Saudi Arabian oil company, Saudi Aramco, is likely to pick up stake in Hindustan Petroleum Corporation Ltd's (HPCL) Visakhapatanam refinery as part of a cross investment plan where HPCL will get equity in Aramco's upcoming refinery at Yanbu, on the Red Sea coast.

In a teleconference from Dammam in Saudi Arabia, the Petroleum Minister, Mr Mani Shankar Aiyar, told presspersons here that India has offered stakes in HPCL's refinery in Visakhapatnam, and the proposed Paradip refinery of Indian Oil Corporation.

Mr Aiyar also said that HPCL has been offered a stake in Saudi Aramco's proposed 20 million tonne a year project at Yanbu.

"We have reached an in-principle agreement for HPCL taking stake in the (20 million tonnes) Yanbu refinery that is planned for export of petroleum products to the West and Saudi Arabia's investment in Vishakapatnam refinery that will be oriented for export to the East," the Minister stated

When asked about the extent of equity stake to be offered to Saudi Aramco, the Minister said that it would be decided by the respective companies.

The Minister said that Indian officials would stay behind to negotiate the deal.

"I am leaving behind (in Riyadh) the HPCL Chairman and Managing Director, Mr M.B. Lal, and the IOC Director (Business Development), Mr N.K. Nayyar, for negotiating commercial terms for the criss-crossing equity arrangement," he said.

Saudi Arabia will supply crude oil to the Visakhapatnam refinery and possibly also to the proposed Paradip refinery, which will export refined petroleum products to markets in the East.

Mr Aiyar also did not rule out the possibility of other Saudi companies investing in India.

On whether there would be any changes in the long-term agreement on Saudi supplies, the Minister said, "Saudi Arabia had given assurances there would be no changes to India's long-term agreements on Saudi supplies."

He added that India expects its crude purchases from Saudi Arabia to double to 50 m.t. a year in 20 years.

The Minister also said that Saudi Arabia has invited OVL and GAIL to bid for gas blocks that they are putting on offer by year-end.

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