State-owned oil marketing companies Hindustan Petroleum Corporation Limited, Indian Oil Corporation and Bharat Petroleum Corporation Ltd have inked a pact to form a joint venture company for the country's largest LPG pipeline project from Kandla in Gujarat to Gorakhpur in Uttar Pradesh. The 2,757 km long LPG pipeline, which is expected to provide reliability in the supply chain of LPG, would cover an overall distance of 1,063 km in Gujarat, 611 km in Madhya Pradesh, and 1,083 km in Uttar Pradesh.
"Indian Oil Corporation Limited (Indian Oil), Bharat Petroleum Corporation Limited (BPCL) and Hindustan Petroleum Corporation Limited (HPCL) signed an agreement on June 3, 2019 for formation of a joint venture company for implementation and subsequent operation of 2757 Km long LPG Pipeline from Kandla to Gorakhpur," HPCL said in a filing to the Bombay Stock Exchange.
As per the exchange filing, Indian Oil would own 50 per cent equity holding in the joint venture company, while BPCL and HPCL would have 25 per cent each.
The consortium of three PSU oil marketing companies (OMCs) plan to import LPG at Kandla in Gujarat and other LPG import terminals on West Coast and two refineries at Koyali and Bina and would directly link 22 LPG bottling plants in Gujarat (3), MP (6) and UP (13) owned by these three promoter companies.
Adding to it, the pipeline would feed LPG through road-bridging to additional 21 LPG bottling plants in Rajasthan, Gujarat, MP, Maharashtra and UP.
Besides economic benefit as compared to road transportation, movement of LPG by pipelines shall enhance safety as well, HPCL said in the exchange filing.
Shares of HPCL were trading at Rs 320.40, down 1.19 per cent, as compared to the previous close of Rs 324.15 on the BSE. The stock hit an intraday high of Rs 333.45 and intraday low of Rs 321.3.
Meanwhile, IOC share price was at Rs 169.15 as compared to the previous close of Rs 165.55, while BPCL shares were trading at Rs 415.8 as against the previous close of Rs 409.15 on the BSE.
Edited by Chitranjan Kumar