No divestment of energy majors: Shourie
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No divestment of energy majors: Shourie

Friday, 21 February 2003, 08:00 Hrs
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NEW DELHI: Disinvestment Minister Arun Shourie Wednesday ruled out the selling of government stake in three Indian energy majors.

"The Oil and Natural Gas Corporation (ONGC), Indian Oil Corporation (IOC) and Gas Authority of India Limited will remain public sector undertakings," Shourie told the Rajya Sabha during a discussion.

He said all security concerns would be taken care of while divesting stake in the Bharat Petroleum Corporation Ltd. (BPCL) and Hindustan Petroleum Corporation Ltd. (HPCL), adding the process would be completed in six to eight months.

Regarding supplies of petroleum products after privatisation, Shourie said about 80 percent of the retail outlets would still remain with state-owned companies.

All necessary provisions were being incorporated in the shareholders agreement of the two state-owned companies to ensure national security concerns were fully addressed, he told the house.

Under a compromise worked out after stiff opposition from within the ruling coalition of Prime Minister Atal Bihari Vajpayee, the government was planning to offer 34.01 percent in HPCL to a strategic partner and make a public offer of 35.2 percent in BPCL in domestic and international markets.

Several energy majors including the Reliance group and Royal Dutch/Shell are expected to bid for HPCL, in which the government holds a 51 percent stake.

Only companies with a combined net worth of over 25 billion and a good track record would be considered by the government for its stake in HPCL, the bids for which close March 17.

On the proceeds of sale, Shourie said a disinvestment fund would be set up soon.

This would channelise the proceeds from disinvestment for reducing public debt, infrastructure and social development, he told Parliament.

"The Mid-Year Review has already underlined the need for creation of a separate Disinvestment Fund and the Finance Minister will constitute the fund in the budget," Shourie said.

Source: IANS
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