October 4, 2022

Currently there is no proposal to privatize BPCL, said the Petroleum Minister

The government had initiated plans to sell its stake in BPCL in 2019. However, due to the pandemic and challenges in the energy sector, the government did not succeed in this.

Currently there is no proposal to privatize BPCL

Petroleum Minister Hardeep Singh Puri on Thursday indicated that state-run petroleum company Bharat Petroleum Corporation Limited. (BPCL) cannot be privatized in near future. Besides, he said, no such proposal is under consideration yet. The government had in November 2019 proposed to sell BPCL under its asset monetization scheme. At that time the government had said it would sell 52.98 per cent stake in the public sector petroleum company. The government received three initial bids for BPCL, but only the Vedanta Group made a financial bid. In such a scenario, in May 2022, the government announced to put BPCL’s privatization plan on hold.

BPCL has no offers for sale

Asked about the government’s future plans in this regard, Puri said, “When there is only one bidder, how will the sale be done under the competitive tendering process? You are aware that not only the administrative ministry is involved in the implementation of the investment plan, DIPAM is also involved. But as per my knowledge, At present, no proposal to sell BPCL is under consideration. The same DIPAM said in a statement, “Given the current state of energy markets across the world, many investors are staying away from the investment process. This statement by the Union Minister put an end to speculations that the central government would disinvest BPCL.” The process is about to restart.

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What has happened so far in the privatization process

In early 2020, the government was confident that BPCL would be privatized even before Air India. Given the company’s profitable position at the time, the government expected investors to be very excited about BPCL. However, due to the pandemic, the privatization process of BPCL was not only delayed, it also did not get the expected response from the investors. BPCL suffered a loss of around Rs 6,300 crore in the first quarter due to higher crude oil prices and no change in petrol and diesel rates. However, during this period the income increased from around Rs 90 thousand crores to Rs 1.38 lakh crores.

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