Oil PSUs plan asset monetisation through InvITs
OIL & GAS

Oil PSUs plan asset monetisation through InvITs

After the power sector PSUs, the country's oil sector PSUs would now float an infrastructure investment trust (InvIT) as a part of the government's asset monetisation programme and mobilise resources for new capital investment.

As part of the programme, gas transportation utility Gail India is expected to set up the gust InvIT in the oil sector in the next financial year (FY). The proposed InvIT will house some of the gas pipeline infrastructure created by the company.

The Ministry of Petroleum and Natural Gas (MoPNG) told the media that this would help Gail to mobilise over Rs 20,000 crore through this route that could help develop new pipeline infrastructure that would help the country develop a gas-based economy.

Two other oil PSUs—Indian Oil Corporation Ltd (IOCL) and Hindustan Petroleum Corporation Ltd (HPCL), may also set up InvIT later. While HPCL and GAIL will focus on monetising their pipeline infrastructure through the investment trusts, Indian Oil proposes to do so in the case of its hydrogen-producing units as well as product pipelines that would be hived off into an InvIT.

The investment trust scheme may be new for the oil sector, but power sector transmission utility Power Grid Corporation has already put some of its assets for monetisation under the InvIT set up by it earlier. Other large PSUs will also be encouraged to take this route. Asset monetisation is an important aspect of the disinvestment exercise for FY22.

An InvIT is an investment vehicle created to hold income-generating and operational infrastructure assets such as roads, power transmission lines, and gas pipelines. These are like mutual funds. Instead of financial securities, InvITs hold bankable assets with long-term contracts with strong counterparties that provide a steady cash flow over the long term.

Image Source


Also read: Infrastructure ministries list assets for monetisation

Also read: GAIL may split, to launch InvIT

After the power sector PSUs, the country's oil sector PSUs would now float an infrastructure investment trust (InvIT) as a part of the government's asset monetisation programme and mobilise resources for new capital investment. As part of the programme, gas transportation utility Gail India is expected to set up the gust InvIT in the oil sector in the next financial year (FY). The proposed InvIT will house some of the gas pipeline infrastructure created by the company. The Ministry of Petroleum and Natural Gas (MoPNG) told the media that this would help Gail to mobilise over Rs 20,000 crore through this route that could help develop new pipeline infrastructure that would help the country develop a gas-based economy. Two other oil PSUs—Indian Oil Corporation Ltd (IOCL) and Hindustan Petroleum Corporation Ltd (HPCL), may also set up InvIT later. While HPCL and GAIL will focus on monetising their pipeline infrastructure through the investment trusts, Indian Oil proposes to do so in the case of its hydrogen-producing units as well as product pipelines that would be hived off into an InvIT. The investment trust scheme may be new for the oil sector, but power sector transmission utility Power Grid Corporation has already put some of its assets for monetisation under the InvIT set up by it earlier. Other large PSUs will also be encouraged to take this route. Asset monetisation is an important aspect of the disinvestment exercise for FY22. An InvIT is an investment vehicle created to hold income-generating and operational infrastructure assets such as roads, power transmission lines, and gas pipelines. These are like mutual funds. Instead of financial securities, InvITs hold bankable assets with long-term contracts with strong counterparties that provide a steady cash flow over the long term. Image Source Also read: Infrastructure ministries list assets for monetisation Also read: GAIL may split, to launch InvIT

Next Story
Equipment

Handling concrete better

Efficiently handling the transportation and placement of concrete is essential to help maintain the quality of construction, meet project timelines by minimising downtimes, and reduce costs – by 5 to 15 per cent, according to Sandeep Jain, Director, Arkade Developers. CW explores what the efficient handling of concrete entails.Select wellFirst, a word on choosing the right equipment, such as a mixer with a capacity aligned to the volume required onsite, from Vaibhav Kulkarni, Concrete Expert. “An overly large mixer will increase the idle time (and cost), while one that ..

Next Story
Real Estate

Elevated floors!

Raised access flooring, also called false flooring, is a less common interiors feature than false ceilings, but it has as many uses – if not more.A raised floor is a modular panel installed above the structural floor. The space beneath the raised flooring is typically used to accommodate utilities such as electrical cables, plumbing and HVAC systems. And so, raised flooring is usually associated with buildings with heavy cabling and precise air distribution needs, such as data centres.That said, CW interacted with designers and architects and discovered that false flooring can come in handy ..

Next Story
Infrastructure Urban

The Variation Challenge

A variation or change in scope clause is defined in construction contracts to take care of situations arising from change in the defined scope of work. Such changes may arise due to factors such as additions or deletions in the scope of work, modifications in the type, grade or specifications of materials, alterations in specifications or drawings, and acts or omissions of other contractors. Further, ineffective planning, inadequate investigations or surveys and requests from the employer or those within the project’s area of influence can contribute to changes in the scope of work. Ext..

Advertisement

Advertisement

Subscribe to Our Newsletter

Get daily newsletters around different themes from Construction world.

STAY CONNECTED

Advertisement

Advertisement

Advertisement

Advertisement

Talk to us?