Hindustan Petroleum Corporation Ltd (HPCL) on Tuesday said it has bought out its partner SP Ports in the firm that was building an LNG importer terminal in Gujarat, for Rs 397 crore.
HPCL and SP Ports Pvt Ltd held 50 per cent stake each in HPCL Shapoorji Energy Pvt Ltd (HSEPL), the firm that is building the 5 million tonne a year liquefied natural gas (LNG) import terminal.
In a stock exchange filing, HPCL said it had entered into a share purchase agreement with SP Ports on March 28 for the acquisition of the private firm's 50 per cent stake in HSEPL.
"It is now informed that the said transaction is completed on March 30, 2021 with the transfer to HPCL 25.70 crore number of equity shares held by S P Ports Private Limited in HSEPL for a total consideration of Rs 397.06 crore," it said.
Later in a statement, HPCL said post-acquisition, the firm's stake in HSEPL has risen to 100 per cent and it has now become a wholly-owned subsidiary of the company.
HSEPL is constructing a 5 million tonne a year LNG terminal at Chhara in the Gir-Somnath district of Gujarat at a project cost of about Rs 4,300 crore which is likely to be completed by the end of the calendar year 2022.
The terminal will have all facilities for receipt of LNG through ocean-going tankers, marine unloading, storage, LNG Road Tanker loading, regasification, and supply of regasified LNG to the gas grid, the statement said adding the project is further expandable to a capacity of 10 million tonne per annum in future.
"The acquisition is in line with the overall future strategy of HPCL to diversify its product portfolio and is an important step in the direction of having a strong presence in the total natural gas value chain," the statement said.
Unlike the stock exchange filing, the statement did not give the value of the deal.
The government is targeting raising the share of natural gas in India's energy basket to 15 per cent by 2030 from the current 6.2 per cent with a view to cutting carbon emissions and make the economy more efficient.
HPCL, along with its joint venture companies, has a presence in the city gas distribution (CGD) business in 20 Geographical Areas (GA) made up of 34 districts in nine states.
It owns and operates 674 CNG stations as on date which it plans to expand further, the statement said without giving details.
It is also making a foray into setting up of LNG dispensing stations.
"These, together with the focus on enhanced use of natural gas in refineries of HPCL and its joint ventures/subsidiaries add to the strategic value of the acquisition," it added.
The Chhara LNG terminal will be located within the boundary of all-weather direct berthing Chhara port being developed by Simar Port Private Limited (SPPL), a wholly-owned subsidiary of SP Ports.
