The latest statement by the Minister of Petroleum and Natural Gas Hardeep Singh Puri has for the time being put to rest any concerns over disinvestment of BPCL.

BPCL (Bharat Petroleum Corporation Ltd) can now focus on its long-term goals without the immediate pressure of privatisation, ensuring stability for its employees and stakeholders, according to those closely associated with the company.

Soon after taking charge as the Minister for Petroleum & Natural Gas for the second term, Hardeep Singh Puri was quoted as saying the Centre is not in favour of divesting the government’s stake in oil marketing companies. Thus, sending a signal of reassurance to the public sector oil companies.

The Centre had planned to sell its entire stake of 52.98 per cent in BPCL, which was expected to fetch an estimated Rs 45,000 crore in FY22, according to reports. The government had invited Expression of Interest (EoI), or initial bids, for these in March 2020. The plan was to complete the process by March 2021. But the process came to a standstill as there was just one bidder left in the fray after the two others dropped out due to their inability to tie up funds for the acquisition.

The government may have paused the privatisation of BPCL due to several potential reasons including Strategic Reassessment: Re-evaluating the strategic importance of BPCL in national energy security and profitability and Stakeholder Concerns: Addressing concerns from employees and other stakeholders about job security and operation, those in the know said.

According to a source “The structural changes already made in anticipation of privatisation was not major and it won’t affect much to companies’ operations / growth.”

An official told businessline that “The government’s halt on disinvestment clearly means BPCL will continue to operate under public ownership, retaining its existing structure and operational policies.”

However, there is a constant uncertainty that the government may just change its plan, another stakeholder said.

Talking about the challenges that still exist for the company, an official said, “BPCL still faces several challenges, including: Market Competition: Competing with private and international players in the oil and gas sector, Operational Efficiency: Improving efficiency and reducing costs amid fluctuating global oil prices.”

Investment in New Businesses/Technology: Entering into new business opportunities and investing in new technologies for sustainable growth, another area of focus now, the official added.

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