The government on Wednesday more than doubled the price of natural gas produced by state-owned Oil and Natural Gas Corp (ONGC) and Oil India Ltd to $4.20 per mmBtu, at par with the rate at which Reliance sells its gas.
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Ministry to propose a new subsidy mechanism to cap upstream firms' share.
The oil explorer's IPO received bids for 80.93 crore (809.3 million) shares against 2.64 crore (26.4 million) on offer as on 1600 hrs. Investment banking sources said that the portion reserved for qualified institutional buyers got subscribed 54 times, while the non-institutional and retail investors bid 9.77 times and 1.14 times respectively.
The Union petroleum ministry has proposed a 44 per cent increase in prices of natural gas sold under the administered price mechanism by state-owned Oil & Natural Gas Corporation and Oil India Ltd.
Oil ministry had previously proposed a 30 per cent hike in price of gas produced by Oil and Natural Gas Corporation and Oil India Ltd to $2.3 per mmBtu but finance ministry wants these rates to be brought on par with RIL, sources in the know of the development said.
The gas price revision will add to the bottomline of the two public sector companies -- Oil and Natural Gas Corporation and Oil India Ltd -- and will also yield additional revenue for the central and state governments.
ONGC Videsh Ltd, the overseas arm of the state explorer, Reliance, IOC and Oil India Ltd had in April this year come together to consider jointly bidding for a 40 per cent stake in a field in the vast Orinoco heavy crude oil belt. To make up for the loss of Reliance, OVL has opened talks with global energy firms and is even willing to take a smaller role in case a major company joins the consortium.
The Reserve Bank on Thursday relaxed norms for overseas investment by Indian corporates by raising their borrowing limit.
A proposal for extension from the Oil Ministry is pending clearance from Central Vigilance Commission and the Central Bureau of Investigation, which is probing allegations that he favoured Mukesh Ambani-led RIL in lieu of personal benefits.
Iran had in September 2008 approved the commerciality of the discovery in the Farsi block. The discovery, which was subsequently named Farzad gas field, may hold inplace reserves of up to 21.68 trillion cubic feet (Tcf), of which recoverable reserves may be 12.8 Tcf. The Indian firm want to liquefy the gas and ship it to India in the form of liquefied natural gas.
Lines up a $1-billion capital expenditure plan for exploration purposes abroad.
The draft note proposes raising gas price for ONGC to Rs 3,765 per thousand cubic meters from current Rs 3,200 per thousand cubic metre. For OIL, the gas price has been proposed at Rs 4,205 per thousand cubic metres. The price would change by Rs 55 per thousand cubic metre for every 10 points change in Wholesale Price Index.
Oil India Ltd, the second state-run firm to hit the market with an offering of equity shares this year, may price its IPO that opens on September 7 at Rs 1,000-1,100 a share.
The Indian firms want to liquefy the gas and ship it to India in the form of liquefied natural gas. OVL, which holds 40 per cent interest and is the operator of the block, has also submitted a feasibility report for the one billion barrel oil discovery it made in 2006.
Investors in international funds should have a horizon of more than five years. Not only will this help them overcome equity and currency volatility, it will also help them enjoy better tax treatment, says Sanjay Kumar Singh.
A drastic reduction in expenditure has boosted the net profit of Essar Oil, India's second largest petroleum refiner, to Rs 169 crore, a jump of 450 per cent in the first quarter ended June 30, 2009. The company, which processed 2.76 MMT of crude in the same quarter, had reported a profit of Rs 30 crore for the corresponding quarter a year ago.
Presently, state-run Oil and Natural Gas Corporation and Oil India Ltd have to bear roughly one-third of the losses on sales of petrol, diesel, domestic LPG and kerosene by way of giving discounts on crude oil they sell to refiners. ONGC and OIL reaped huge profits as crude oil prices rose internationally, prompting the government to consider taking away any earnings over and above $75 per barrel through a WPT.
The list mostly contains PSUs which were up for sale in the last fiscal.
The NSE 50-share Nifty spurted 97.25 points, or 0.92 per cent, to 10,715.50
Divestment in major state-run firms is set to perk up the IPO space, with about six PSUs including Air India, BSNL, Oil India and NHPC, gearing up to sell equity sale in the primary market.
The Petroleum Ministry has proposed a 33 per cent hike in the price of natural gas produced by ONGC and Oil India and gradually increase it to $4.20 per mmBtu set for gas from Reliance Industries' KG-D6 fields.
The Oil and Natural Gas Corporation will pay Rs 852 crore (Rs 8.52 billion) for subsidising petrol and diesel during January-March quarter but state gas utility GAIL India has been spared from the subsidy burden.
State-owned oil producers are planning to upgrade security arrangements protecting their oil installations in Assam following a series of bomb blasts on Thursday that left many dead and injured.
As fuel prices surged in September, the government's decision to ask companies to cut price by Rs1 each on a litre of petrol and diesel came as a dampner for private players.
Oil and Natural Gas Corp, Reliance Industries and Indian Oil Corp, the nation's biggest companies, are coming together for the first time, to bid jointly for a vast oilfield in Venezuela, which will require an investment of $16-18 billion.
While some bankers said that responses to the Sebi are being delayed deliberately in some of the cases in view of the turbulent market conditions prevailing on the bourses, those associated with some of these deals said these are 'routine' clarifications and would be responded in the due course. According to the latest processing status as on March 14 of draft offer documents filed with Sebi, clarifications are currently awaited from lead managers in relation to 20 IPOs.
The government on Monday fixed the issue price of the initial public offer of state-run explorer Oil India at Rs 1,050 per share, raising a cumulative Rs 4,982 crore.
The deployment of the special forces, however, will come at a cost for the industrial houses and tea companies. They will have to pay to utilise the services of the special government security forces that will operate under the state director general of civil defence and home guards.
The government allocated Rs 650 billion for petroleum subsidies in FY14, of which Rs 450 billion was used to pay oil marketing companies for the subsidy gap incurred in the previous financial year.
There were about 290 bandhs, blockades called by numerous organisations during fiscal 2012-13.
The petroleum ministry has prepared a draft Cabinet note for raising prices of natural gas produced by ONGC from fields given to it on nomination basis to Rs 3,765 per thousand cubic metres (or $1.98 per million British thermal unit) from current Rs 3,200 per thousand cubic meter ($1.68 per mmBtu). For OIL, the gas price has been proposed at Rs 4,205 per thousand cubic meters, a senior ministry official said.
OIL, the nation's second biggest state-run oil and gas explorer, was to launch its IPO of 2.64 crore equity shares on November 10, but the reversal of fortunes on the stock markets led to its deferment by a few weeks. It now has been put back for at least a couple of months.
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Agnelo Colaco struck in the second half as Vasco SC stunned Mohun Bagan 1-0 to throw open Group D in the 30th Federation Cup at the floodlit Vidyasagar Krirnagan in Barasat on Sunday.
Oil and Natural Gas Corporation and GAIL India are likely to give 33 per cent lesser discounts on crude oil and cooking gas to the state-owned refining and marketing companies than estimated as oil prices have tumbled in the last three months and the refiners have started making profits.
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While the measures are aimed at moderating outflows, RBI added that genuine requirement beyond these limits will continue to be considered under the approval route.
A price reduction may be considered if crude oil falls to $61 per barrel, he said. The basket of crude oil India buys was at this year's lowest of $68.81 per barrel. Indian Oil, Bharat Petroleum and Hindustan Petroleum are currently losing about Rs 280 crore (Rs 2.8 billion) per day on sale of petrol, diesel, domestic LPG and kerosene as government has not allowed them to align retail prices with cost of production.
OIL's initial offering of 2.64 crore equity shares was to hit the market on November 10, but the reversal of fortunes on the stock markets has led to a re-think on the timing. Government holds 98.13 per cent stake in OIL, which produces close to four million tonnes of crude oil a year.
