Bharat Petroleum Corporation Ltd (BPCL), the state-owned oil refining and marketing company, will soon initiate talks with Indian Oil Corporation and Reliance Industries on a long-term product supply contract after 2004, when it ceases to be a public sector undertaking.
The government has said it wants to sell its 35.2 per cent equity in BPCL through a market offering.
Post-divestment, BPCL will have to buy petroleum products to meet its marketing requirements. Besides, other state-owned companies will not be obliged to swap products with it.
As a public sector unit, BPCL is allowed to swap products at ex-factory prices with Indian Oil and Hindustan Petroleum Corporation Ltd, ensuring higher margins.
Explaining the post-float scenario for BPCL, the executive added that Indian Oil was unlikely to supply products at ex-refinery prices.
