Union Petroleum Secretary Vivek Rae informed reporters that the government was yet to take a decision on whether to allow GAIL India to raise its shareholding in Petronet LNG.
GAIL India, which holds 12.5 per cent stake in Petronet LNG, has shown keen interest in buying an additional 39 million shares or 5.2 per cent stake held by Asian Development Bank in Petronet.
However, the management of Petronet is opposing GAIL’s intention as such a move would raise the stake held by public sector firms in the company above 50 per cent and this would turn the LNG importer into a government entity.
It may be noted that besides GAIL, Oil and Natural Gas Corp, Indian Oil and Bharat Petroleum hold a 12.5 per cent stake each in Petronet.
GAIL insist on buying ADB stake as its board believes that it is strategically important for the gas player to have a greater say in Petronet.
Petronet is registered as a private company even though public sector oil firms hold 50 per cent stake and Oil Secretary is its chairman.
Since 2004, ADB has been holding 5.2 per cent stake in Petronet . It had in fact first proposed to exit Petronet in 2008 but was persuaded to stay on as the four promoters made a strong pitch to buy the stake.
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