Oil PSU sell-off on case-by-case basis

Oil PSU sell-off on case-by-case basis
ENS ECONOMIC BUREAU

MUMBAI, JAN 12: The disinvestment in oil sector PSUs will be decided on a case-by-case basis instead of any blanket sell-off, Petroleum Minister Ram Naik said here today. The Oil Minister was responding to Finance Minister Yashwant Sinha's announcement yesterday in New Delhi that the Government will bring down its equity in 12 oil sector PSUs to 26 per cent.

``Of the 12 PSUs, we will complete the sale of four stand alone refineries before March this year to Bharat Petroleum Corp and Indian Oil. Besides, the government has already announced that it will not reduce its stake below 51 per cent in Gas Authority India Ltd, Indian OIl, and Oil and Natural Gas Commission. The rest, which includes BPCL and HPCL... it would be decided on a case-to-case basis,'' he added.

On IBP, Naik said the bids would be invited by this month and depending upon the response, we will like to complete the sale before March this year,'' he added.

On OIL & Natural Gas Corporation (ONGC), Naik said the corporation will be generating funds from its internal resources to invest in the Rs 7,500 crore Mumbai High redevelopment programme.

The redevelopment programme is expected to enhance the crude oil recovery by an additional of 4 to 5 per cent. ``As per our plan, we would be able to produce crude oil worth Rs 110,000 crore from the re-development plan,'' Naik said.

The oil gain as a result of this technologically-aided programme would be around 75 million metric tonnes over the project life of 6 to 7 years.

The redevelopment programme which is being implemented in association with international oil field consultant Gaffney Cline and Associates from Germany, have reduced the cost in development of each well by Rs 2 crore.

The programme involves drilling of 74 new wells spreading over both Mumbai High North and Mumbai High South reservoir, covering an area of 12,00 sq. Kms. The gas recovered from the new oil fields would be exclusively provided as feedstock to major industries in Maharashtra, Naik said.

``Our oil import bill for the current fiscal would increase to Rs 80,000 crore from Rs 53,000 crore recorded last year... it's, therefore, necessary for us to increase our own production,'' Naik added.

In order to get good response to the 25 new oil blocks for sale by the government, Naik said that he himself is leading an official team to conduct roadshows in major world cities like Houston in US, London, Tokyo and Singapore to attract international investors in exploration and production of hydrocarbons in the country.

Beginning from January 17 in London, the Minister will lead the roadshow in US on January 21 and 22 and in Japan and Singapore by the second week of February.

The Centre has announced the second round bids for 25 blocks from Indian as well as international firms on December 15 which included deep sea exploration and on-shore oil fields. The recent breakthrough in the offshore deepwaters in the Krishna Godavari basin on the east coast and in shallow waters in the Gulf of Khambat has opened up new vistas in hydrocarbon exploration.