GAIL, HPCL seek nod for Rs 300 cr overseas binge

GAIL India Ltd and Hindustan Petroleum Corporation (HPCL) have sought the government's approval for easy clearance for overseas investments of over Rs 300 crore.

Currently, ONGC Videsh, foreign arm of Oil and Natural Gas Corporation (ONGC) and the Indian Oil Corporation (IOC)-Oil India (OIL) combine are enjoying the special mechanism through an empowered group of secretaries (EGS), which ensures single point approvals for overseas investments exceeding Rs 300 crore. For other companies, the process is long and complicated.

"While India Inc is piling up overseas investments in oil sector, the GAIL-HPCL combine has to bear the brunt of Centre's sealing of Rs 300 crore for foreign investments. The combine has been pursuing the government for a level playing field with other global oil companies for equity investments overseas, but no decision has come out yet," a source close to the companies said.

Both the companies have lined up a handful of projects, but only one project has materialised so far. Last month a consortium comprising GAIL, HPCL, Videocon, Oilex Australia and Bharat Petroleum Corporation was awarded a block in Oman.

"For pursuing overseas exploration and production activities, GAIL had already signed a memorandum of understanding (MoU) with HPCL. Now, both the companies are running behind the government for a single clearance point for overseas investments," sources said.