National Iranian Oil Co To Hike Stake In Mrl To 13%

The National Iranian Oil Company (NIOC) will hike its stake in Madras Refineries Ltd from the current 10 per cent to 13 per cent, its original stake in the company.

The company did not subscribe to Madras Refineriess rights issue that was made in 1994, owing to which its stake got reduced to 10 per cent. The unsubscribed portion is being picked up by the Iranian oil company now.

S N Mathur, chairman and managing director of Madras Refineries, said here yesterday that the companys equity base will thus remain undiluted, even as it will benefit from a capital inflow of about Rs 45 crore,

 

To keep pace with the opening up of the oil sector, Madras Refineries had appointed a restructuring committee in February to suggest ways to increase production and improve its financial prospects. The terms of reference include financial restructuring and operational improvements for the stand-alone refinery.

The report is expected to tabled by the end of next month.

Madras Refineries has roped in I-SEC to suggest ways of raising fund for its proposed projects in the next five years.

The proposed projects include the three million tonnes grassroots refinery, a power project and a diesel hydrodesulphurisation plant.

The diesel hydrodesulphurisation project will be set up to reduce sulphur content in diesel from the current 1 per cent to 0.25 per cent.

For 1997-98, Madras Refineries has allocated Rs 240 crore for the project.

Going by the current indications, profit before tax for the year is expected to be about Rs 120 crore while profit after tax has been projected at Rs 100 crore.

The desulphurisation proposal has already got the Stage I approval from the government and the detailed feasibility report will be commissioned soon.

The project is expected to be completed by 1999.

Mathur said Madras Refineries will have to get about Rs 200 crore (net) from the oil pool account.

On the controversial AROCHEM project, over which Madras Refineries is locked in a legal battle with co-promoter SPIC, the chairman said dialogue between the two partners has re-started. The two-man committee appointed by the promoters is ready, and will now be taken up for discussion by the two chairmen.

The Madras Refineries chief said that SPIC has now agreed to a joint re-evaluation of the AROCHEM project as opposed to its earlier stand.

Shamsunder top contender for chairmans post

The Public Enterprises Selection Board (PESB) has placed V Shamsunder, Indian Oil Corporation (IOC) executive director, at the top of the list of candidates for the post of chairman and managing director of Madras Refineries Ltd (MRL). S N Jha, another IOC executive director, is second on line in the list.

About 16 candidates are in the fray for the post, interviews for which were held on April 25. The formal selection is expected to be announced in about six weeks time.

The post had fallen vacant following the removal of N S Ravikumar about six months ago. Ravikumar is currently executive director of Centre for High Technology (CHT).