Mumbai/New Delhi: The government wants all the three oil marketing companies ( OMCs) — IndianOil Corporation ( IOC), Bharat Petroleum Corporation ( BPCL) and Hindustan Petroleum Corporation ( HPCL) — to merge their pipelines and aviation assets to bring these under the umbrella of a single joint venture company. Although the government’s rationale is to control budget in creating a similar infrastructure by the three companies, the proposal has not found favour with IOC, the biggest marketer of petroleum products in the country.
IOC had a near-monopoly in aviation assets, with 101 aviation fuel stations and wherever the other two companies did not have such stations, it charges exorbitantly, said senior executives in BPCL and HPCL.
Through its subsidiary IndianOil Aviation Service, IOC provides aviation turbine fuel ( ATF) or jet fuel to major international and domestic airlines, refuelling over 1,500 flights. “IOC is present at 100 airports and if you have multiple suppliers, the price will become competitive for IndianOil. Though there may not be much difficulty in creating new assets, one has to figure out how to merge the existing ones,” said an HPCL executive.
The Ministry of Petroleum and Natural Gas has held a couple of meetings on the issue, but a move to have separate company for pipelines has not been successful.
10/01/13 Kalpana Pathak & Jyoti Mukul/Business Standard
