New Delhi, July 19: In order to implement the idea of an integrated oil company union cabinet today ratified the proposal of merger of state-owned Oil and Natural Gas Corp (ONGC) and Hindustan Petroleum Corp Ltd (HPCL). Earlier in his Budget speech, Finance Minister Arun Jaitley had suggested the idea of an integrated oil company.
Finance Minister, Road and Transport Minister and Oil Minister will be a part of the merger panel which will complete the process of the merger within this financial year. The state state-owned company HPCL will remain listed as a subsidiary of ONGC after its merger. According to oil minister Dharmendra Pradhan ONGC had sent a proposal to acquire HPCL.
Currently, the government owns 51.1 percent stake in HPCL. HPCL will add 23.8 million tonnes of annual oil refining capacity to ONGC's portfolio, making it the third-largest refiner in the country.