CCEA Approves BPCL Proposal for Additional Equity Investment and Mozmbique LNG Project
BY Tiya Chatterji 29.Nov.2019
The Cabinet Committee on Economic Affairs (CCEA) is envisaged to have given its approval for additional investment of $2,670 million by Bharat Petro Resources Ltd (BRPL), a wholly-owned subsidiary of Bharat Petroleum Corporation Ltd (BPCL), for a LNG project in Mozambique.
The cabinet committee which had met on Nov, 27 is also said to have given the green signal for additional equity investment of ₹10,000 crore by BPCL into the equity share capital of BRPL. There was however, no official communication on the decision by the government as of now.
These decisions are viewed as essential steps towards the enhancement of the potential valuation of the company. Business orientation in Oil and Gas sector requires time to time investment, while them being constant. The market watchers believe this step to upgrade the valuation of the stakes while also interest the prospective bidders, which look at multifaceted factors.
Currently, the industry presumes that depending on the competitive intensity during bidding, the government is likely to garner for a full-stake sale which could be in the range of ₹60,000-70,000 crore. The Department of Investment and Public Assessment Management (DIPAM) is in preparation for the stake sale. Previous month, DIPAM had requested for proposals for appointments of advisors for strategic disinvestment, legal and one asset valuer for the purpose.