This would mean that those seeking to partner with HPCL would have to pick up stake in more than one of its projects.
New Delhi, Aug. 24
HINDUSTAN Petroleum Corporation Ltd (HPCL) is actively considering the concept of a chain offer for equity participation in its projects. This in effect would mean that those seeking to partner with HPCL would have to pick up stake in more than one of its projects.
For instance, interested parties will be offered stake in both its Bhatinda and Vishakhapatnam projects, instead of having different partners for each of them.
Interest has been shown by overseas companies including Total and Saudi Arabia national oil firm Saudi Aramco for equity participation in its Visakhapatnam refinery, according to a senior HPCL official.
Incidentally, HPCL recently lost out in the race for an equity stake in Saudi Aramco's 20 million tonnes Yanbu refinery project.
HPCL's stake in Aramco's project on the Red Sea Coast was expected to be a part of a cross investment plan, in which the Indian firm was to get equity in the Saudi firm's project.
On whether the company would hive off the Visakhapatnam refinery project into a subsidiary company to bring in the joint venture partner, the HPCL official said negotiations were on for striking a partnership. Subsequent to the joint venture, the exact structure of the company will be decided.
The talk with the Saudi company was initiated during the visit of the Petroleum Minister, Mr Mani Shankar Aiyar, to that country in March. Mr Aiyar had offered Saudi Aramco a stake in HPCL's 7.5 million tonnes Visakhapatnam refinery or Indian Oil Corporation's upcoming 12 million tonnes Paradip refinery in Orissa to get an Indian firm on board the Yanbu refinery.
The barter deal was aimed at strengthening co-operation between the two nations in the hydrocarbon sector.
Aramco had offered a minimum of 25 per cent and up to 50 per cent stake in the 4,00,000 barrels per day (20 million tonnes per annum) Yanbu refinery to international investors depending on their commitment to offtake products.
Besides IOC and HPCL, Saudi Aramco was in dialogue with about half a dozen global firms including Chinese and European oil companies for a strategic partnership in the refinery. Saudi Arabia accounted for one-fourth of Indian crude oil imports of just over 90 million tonnes in 2003-04. Saudi Arabia has also assured to supply as much crude as India requires.
HPCL has been considering expanding the capacity of the Visakhapatnam refinery to 15 million tonnes.