Union Petroleum and Natural Gas Minister Hardeep Puri has said that the disinvestment plan for Bharat Petroleum Corporation Limited, India’s second largest oil refining and fuel retailing firm, is not on the table yet.
Last month, the government said it would take a decision on resuming the process of strategic sale of BPCL based on a review of the situation.
In a written reply in the Lok Sabha, Bhagwat Kishanrao Karad, Minister of State for Finance, informed about the Covid-19 pandemic, energy transition issues and geo-political conditions affecting several industries globally, especially the oil and gas industry.
“The Government of India has decided to discontinue the current EOI process for strategic disinvestment of BPCL. The decision to restart the strategic disinvestment process of BPCL depends upon an appropriate timely review of the situation,” Karad said.
The government in May withdrew its offer to sell its entire 52.98% stake in BPCL, saying most of the bidders have expressed their inability to participate in the current privatization process due to prevailing conditions in the global energy market.
The government had planned to sell its entire 52.98% stake in BPCL and had invited Expression of Interest (EoI) from bidders in March 2020. There were at least three bids till November 2020.
However, the privatization was stalled after two bidders ran into issues like lack of clarity in fuel pricing, with only one bidder left in the fray.
“…Most of the Qualified Interested Parties (QIPs) have expressed their inability to continue with the current process of disinvestment of BPCL,” Karad said.
Mining mogul Anil Agarwal’s Vedanta Group, US venture fund Apollo Global Management Inc and I Squared Capital Advisors had expressed interest in buying the government’s stake in BPCL.
But both funds withdrew after failing to engage global investors amid declining interest in fossil fuels.
The government had not invited financial bids.
BPCL targets net zero by 2040
The state-refiner plans to increase its renewable energy portfolio to 10 GW by 2040 – the year it is targeting net-zero carbon emissions, chairman Arun Kumar Singh has said.
Addressing the company’s annual shareholders’ meeting, he said that BPCL is diversifying and expanding into adjacent and alternative businesses, which will not only provide additional revenue sources but also offer a hedge against any dip in the oil and gas business. Will do
“The company has identified six strategic sectors – petrochemicals, gas, renewables, new businesses, i.e. consumer retailing, e-mobility and upstream – which will serve as pillars of future growth and create sustainable value for all stakeholders. while the core business of refining and marketing petroleum products continues to provide stability and funding bandwidth,” he said.
He said this is with a view to achieve net-zero emissions by 2040.
In the renewable energy sector, BPCL plans to increase its portfolio from as low as 50 MW today to 1 gigawatt (GW) by 2025 and to 10 gigawatt by 2040.
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