SHRI RAM NAIK APPROVES INCREASE IN OIL’S EQUITY IN NRL
In a major initiative
for the benefit of the North East, Shri Ram Naik, Minister of
Petroleum and Natural Gas has approved the restructuring of the
equity of Numaligarh Refinery Limited (NRL) in Assam. Accordingly
the equity of Oil India Ltd. (OIL), an upstream Public Sector
Undertaking (PSU) under the Ministry of Petroleum and Natural
Gas would go up from 12.35% to 26% in NRL. The equity restructuring
is proposed to be achieved by transferring to OIL the 12.34% shares
held by the Oil Industry Development Board (OIDB) and 1.31% from
Bharat Petroleum Corporation Ltd.’s 61.5% holding in NRL.
It may be recalled
that Shri Ram Naik had earlier taken two important decisions benefiting
the North-Eastern States. These include increasing the royalty
on crude oil and allocating 1.5 million tons of Ravva Crude Oil
to Bongaigoan Refinery and Petro-chemicals Ltd. (BRPL). While
the royalty accruals to Assam have increased by about Rs. 200
crore a year, the allocation of Ravva Crude have brought about
a turn around of BRPL from a loss of Rs. 199 crore in 2001-02
to a profit of Rs. 178 crore in 2002-03.
The present decision
is expected to benefit OIL through vertical integration along
the entire value chain as has been the case of Oil and Natural
Gas Corporation (ONGC) with the take over of Mangalore Refinery
and Petro-chemicals Ltd in May, 2003. NRL with authorisation to
set up 510 retail outlets completes the linkage for OIL from exploration
to the marketing. OIL being a major supplier of crude oil to NRL,
would provide security of crude oil supplies to the Assam Accord
Refinery. The strengthening of OIL and NRL would benefit the North
East Region as a whole as OIL is the largest public sector company
with deep roots in the North East.
The decision also
re-inforces the commitment of the Central Government to promote
and develop NRL which came into existence under the 1984 Assam
Accord.
