HPCL steps back on Shell stake buy
HPCL, which was in race to acquire a substantial stake in Royal Dutch Shell’s LNG terminal at Hazira, has now backed out.
By Piyush Pandey, TNN |
MUMBAI: State-owned Hindustan Petroleum Corp (HPCL) which was in race to acquire a substantial stake in Royal Dutch Shell’s LNG terminal at Hazira has now backed out. This was after submitting a non-binding offer and completing the due diligence of the terminal.
People familiar with the development attributed the move to Shell’s inability to give a commitment of assured LNG supply on a long-term basis. Besides HPCL, Bharat Petroleum Corp (BPCL), Indian Oil Corp (IOC) and GAIL are said to be in talks with Shell for buying stake in the terminal.
“There is no point of investing money when we do not have assured long-term gas supplies. Therefore, we have dropped the plan,” HPCL’s chairman and managing director, MB Lal told ET.
Total of France has 26% interest in each of the three companies that comprise the Hazira LNG terminal and the port: the port company, the LNG terminal company and the marketing company.
“We are unaware of any substantive discussions between Shell and HPCL and therefore, cannot comment,” a Shell official spokesperson said. The company is now thinking of developing a 5-MMTPA (metric millions tonnes per annum) LNG import terminal at Mundra on its own.
ADVERTISEMENT
HPCL has already conducted a detailed feasibility study for this project and the project cost is pegged at around Rs 2,600 crore. The scope of developing LNG terminal at Mundra also includes associated gas evacuation pipelines from Mundra to Delhi. “Discussions are in progress to source LNG for this project,” Mr Lal said.
Start a SIP with as low as ₹500 with ET Money App!
Download
The Economic Times News App for Quarterly Results, Latest News in ITR, Business, Share Market, Live Sensex News & More.
The Economic Times News App for Quarterly Results, Latest News in ITR, Business, Share Market, Live Sensex News & More.
ADVERTISEMENT
