Petroleum Minister favours merger of CPCL with IOC

Centre is expecting more co-operation from the state government, says Minister

Union Minister of State (Independent Charge) for Ministry of Petroleum and Natural Gas Dharmendra Pradhan on Saturday said that the Chennai Petroleum Corporation Ltd (CPCL) had to be merged with its parent company Indian Oil Corporation Ltd (IOCL).

Addressing a gathering at the CPCL refinery in Manali, near Chennai, as part of its golden jubilee celebrations, the minister said, “When the next stage of expansions happen, it should be within the umbrella of IOCL. I am for CPCL’s merger with IOCL.”

He added the Centre’s vision was to bring all the energy companies under one umbrella. The minister, however, said that there were some technicalities, such as those related to the shareholding of the National Iranian Oil Company. He said that during his visit to Iran and the US, he had discussed the issues with the authorities concerned and that after the sanction on Iran was lifted, the scenario was changing.

The Iranian company holds around 14 per cent share in CPCL, and due to the sanction, the funding for the expansion of CPCL was stuck. The government has been looking at buying the stake and merging the refinery with IOCL.

Pradhan said that the government wished to develop the refinery to a greater level and that there were positive signs towards this. “When we will expand this refinery, it will look into the future market of south India,” he said.

It will be a petrochemical hub catering to the local requirements of Tamil Nadu and south India, he added. IOCL has already invested around Rs 1000 crore and has more plans to invest.