State-run Oil India Ltd (OIL), in consortium with Engineers India Ltd (EIL), have placed their bid for acquiring 61.65 per cent stake of Bharat Petroleum Corporation Ltd (BPCL) in Numaligarh Refinery Ltd (NRL), an IANS report said on Friday citing sources privy to the matter.

With the submission of the bid, the transaction for Numaligarh refinery may now be targeted for closure before the end of March.

Another report suggested that the interested companies have submitted bids on February 20. However, it is still not clear whether Assam government will participate in the process.

An OIL statement had earlier said that its bid for the NRL will be submitted through a formal process. The exact percentage of the stake of the OIL and the EIL will depend on the extent of Right of First Offer (ROFO) to be exercised by the Assam government which already holds 12.35 per cent stake in the NRL.

Sources indicated that the state government may pick up additional equity in the refinery so that its holding increases to 26 per cent which gives it effective control over the operation of the refinery. The balance 48 per cent of the BPCL’s equity may be divided between the OIL and the EIL with the latter picking up 10 per cent stake.

In the current structure of Numaligarh Refinery, while the BPCL holds 61.65 per cent stake, the OIL holds 26 per cent and the Assam government 12.35 per cent.

The NRL is the largest customer of the OIL’s crude produced from its northeastern fields. The acquisition is expected to improve the synergy in the OIL’s portfolio and it develop an integrated oil operation involving exploration, refining, and marketing.

A Navratna PSU, the OIL is a fully-integrated E&P company in the upstream sector and is the second largest national oil and gas company in India as measured by total proved plus probable oil and natural gas reserves and production. Engaged in the business of exploration, development and production of crude oil and natural gas, transportation of crude oil and production of LPG, the OIL also provides various E&P related services.

Besides being a pan-India E&P company, the OIL also has overseas presence including in Russia, Mozambique, the US, Venezuela, Gabon, Bangladesh, Nigeria, Libya etc. Besides 26 per cent stake in the NRL, it also has stake in the Brahmaputra Cracker and Polymer Ltd (BCPL) in the downstream business.

The NRL has been carved out from the BPCL and is not part of assets that is being sold as part of its privatisation plan.

The government in 2019 had cleared the proposal for strategic sale of its 53.29 per cent stake in BPCL. At the time of the announcement the government had made it clear that the process of privatisation will be excluding the company’s interests in Numaligarh Refinery.