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Reliance in talks to lease out petrol pumps: Report

Energy group Reliance Industries Ltd is in talks to lease out its shuttered retail petrol pumps to state-run Hindustan Petroleum Corp Ltd, the Business Standard reported today.

business Updated: Mar 05, 2009 11:24 IST
Reuters
Hindustantimes

Indian energy group Reliance Industries Ltd is in talks to lease out its shuttered retail petrol pumps to state-run Hindustan Petroleum Corp Ltd, the Business Standard reported on Thursday.

Refiner HPCL, which operates pumps across the country, has issued a limited tender to five merchant bankers to advise it on the deal, the newspaper said, citing a source familiar with the matter.

Reliance, controlled by billionaire Mukesh Ambani, had shut its pumps more than a year ago as government-set low prices of petrol and diesel caused heavy losses when crude oil prices climbed.

Only state-run marketers such as HPCL were compensated by the government through issue of bonds that companies could sell and raise cash.

The newspaper said a deal would help Reliance earn cash from the lease, while HPCL could claim compensation from the government when world crude prices rose.

Spokesmen for Reliance and HPCL declined to comment on the report.