NEW DELHI: Privatisation of India’s second-largest state-run refiner and fuel retailer Bharat Petroleum Corporation Ltd (BPCL) has suffered yet another delay, with the government extending the deadline for submission of EoI (expression of interest) for the fifth time to November 16 amid falling fortunes of global oil majors.
A notification by DIPAM (department of investment and public asset management) on Wednesday, the deadline set after the fourth extension, cited “requests from interested bidders and the prevailing situation arising out of Covid-19 pandemic” as the reason for the latest postponement.
The government had invited EoIs for selling its entire 52.98% stake in the company for the first time on March 7 with a deadline of May 2. Subsequently, the deadline was extended four times on March 31, May 26, July 29 and August 14 citing same reasons.
The stake is worth roughly Rs 50,000 crore at today’s market value and the successful bidder will have to spend another Rs 30,000 crore for making an open offer.
The selloff was to be the largest till date and first sale of government stake in a profitable company through bidding since 2003 when the NDA-1 government under PM A. B. Vajpayee privatised companies such as fuel retailer IBP and zinc manufacturer HZL.
Disinvestment of BPCL is crucial at this juncture for the cash-strapped government and finance minister Nirmala Sitharaman’s budget plan to raise Rs 2.1 lakh crore from selling stakes in government-run entities in 20120-21 financial year.
BPCL’s 65% stake in Numaligarh refinery in Assam has been kept out of the selloff process since it was built as part of the Centre’s accord with the state government. This stake will be bought by other state-run oil companies, which have been barred from bidding for BPCL.
The company will give the buyer ready access to 14% of India’s oil refining capacity, almost a quarter of the fuel retail market in the world’s fastest-growing energy market and a huge land bank across the country.
BPCL operates four refineries in Mumbai (Maharashtra), Kochi (Kerala), Bina (Madhya Pradesh) and Numaligarh (Assam) with a combined capacity of 38 million tonnes per annum, or 15 per cent of India’s total refining capacity of 249 million tonnes. It also owns 15,177 petrol pumps, 6,011 LPG distributorships and 51 LPG (liquefied petroleum gas) bottling plants. The company distributes 21 per cent of petroleum products consumed in the country and owns a fifth of the 250 aviation fuel stations in the country.
Any private company having a net worth of $10 billion is eligible to bid. Consortiums of not more than four are also allowed to bid but the lead member must hold a 40% stake in the grouping, while others must have a minimum net worth of $1 billion. Changes in the consortium are allowed within 45 days of bidding but the lead member cannot be changed.



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