Date:21/06/2007 URL: http://www.thehindu.com/2007/06/21/stories/2007062150771700.htm

Business

Decision on HPCL-Mittal JV today

Sujay Mehdudia

NEW DELHI: The Cabinet Committee on Economic Affairs (CCEA) will take up on Thursday the proposal of the Petroleum Ministry for a joint venture between the L N Mittal group and Hindustan Petroleum Corporation Limited for construction of the Bhatinda refinery at an investment of Rs. 17,000-crore, the biggest foreign direct investment (FDI) in the petroleum sector, Petroleum Minister Murli Deora said here on Wednesday.

Talking to newsmen at Noida on the outskirts of New Delhi, Mr. Deora said the Cabinet would take up on Thursday the investment proposal for approval. The Petroleum Ministry had granted project-specific approval to Mittal Investments Sarl, the holding company of L. N. Mittal, to pick up stake in Hindustan Petroleum’s refinery. The proposal was required to be cleared by the CCEA as per the current policy that restricts FDI in public-sector petroleum refineries to 26 per cent. The current policy also restricts PSU holding to 26 per cent in such projects and makes it mandatory for the balance 48 per cent to be offered to the public.

HPCL had on March 2 signed an agreement with Mittal Investments for the nine million tonne refinery in Punjab. Mittal Investments will acquire 49 per cent stake in the refinery for Rs. 3,365 crore.