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| Oil India to hit capital market on Sep 7 |
| Press Trust of India / Mumbai Aug 28, 2009, 17:34 IST |
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Oil India (OIL), the nation's second-largest state-run explorer, will hit the capital market with its initial public offer (IPO) on September 7.
The offer will be open from September 7 to 11 and the price-band has been fixed between Rs 950 and Rs 1,050 per equity share.
OIL, which produces 3.5-million tonnes of oil annually, will offer 2.64-crore equity shares to the public through the IPO.
An 11 per cent fresh equity will be sold through the issue while the government would divest 10 per cent of its stake at the IPO price.
Post-IPO and disinvestment, the government's stake in the company will drop from 98.13 per cent to 78.5 per cent.
Proceeds from the issue would be used to fund capex requirement for 2009-10 and 2010-11 when it has planned Rs 2,300-crore and Rs 2,400-crore expenditure, respectively.
"We have laid down a capex of around Rs 4,500 crore for exploration, development, production and transportation of crude oil over the next two years," OIL Director (Finance) T K Ananth Kumar told reporters here today.
Besides, the company will also expend the capital to purchase equipment, fund a 650-km crude pipeline in the north- east and in its city gas distribution venture with Bharat Petroleum Corporation (BPCL).
Oil India Chairman and Managing Director N M Borah, said the company is confident of doubling its natural gas production to 4.54-billion cubic metres (bcm) annually in the next 5-6 years.
OIL currently produces 3.57-million tonnes of crude and 2.27-bcm gas annually.
"We are confident of continuance of positive growth in our total production. Natural gas production, as a matter of fact, we are confident that we are in a position to more or less double our production in the next 5-6 years time," he said.
"There is a potential for gas production to go up by 8 per cent and crude output to further rise by up to 12 per cent," Borah said.
The explorer, which has hydrocarbon interest in seven countries, including Iran, Egypt and Nigeria, said it is on the look-out to bid for assets abroad.
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