1. ON FEBRUARY 24, 1976, THE GOI FINALIZED ITS TAKE OVER OF
BURMAH SHELL'S REFINERY AND MARKETING COMPANY IN INDIA AT A
TOTAL COST OF RS. 431 MILLION (EQUIVALENT TO ABOUT 23.6 MILLION
POUNDS STERLING). THIS INCLUDES RS. 92.5 MILLION (5.1 MILLION
POUNDS STERLING) FOR THE TRANSFER TO GOI OF THE BURMAH SHELL
REFINERIES LTD., BOMBAY AND RS. 338.4 MILLION
(18,548,421 POUNDS STERLING INCLUDING PRINCIPAL AND TAX FREE
INTEREST) FOR THE ACQUISITION OF BURMAH SHELL STORAGE
AND DISTRIBUTION COMPANY OF INDIA LTD. PARLIAMENT'S PASSAGE OF
THE BURMAH SHELL (ACQUISITION OF UNDERTAKINGS IN
INDIA) ACT, 1976. CALLS FOR FOUR EQUAL ANNUAL INSTALLMENTS OF
THE PRINCIPAL OF 3,802,443 POUNDS STERLING
TO BE PAID TO BURMAH SHELL IN LONDON BEGINNING MARCH 30, 1977
PLUS A DECLINING INTEREST PAYMENT.
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2. THE NEW PUBLIC SECTOR COMPANY TO OPERATE THE BS
REFINERY HAS BEEN NAMED THE BHARAT REFINERIES LIMITED. A SEVEN
MEMBER BOARD OF DIRECTORS INCLUDING A CHAIRMAN HAS BEEN ESTAB-
LISHED TO OPERATE THE NEW COMPANY. IN ADDITION TO CHAIRMAN
DR. S. KRISHNASWAMI, WHO WILL CONTINUE TO SERVE
CONCURRENTLY AS CHAIRMAN AND MANAGING DIRECTOR
OF HINDUSTAN PETROLEUM, THREE FORMER BURMAH SHELL OFFICIALS
HAVE BEEN RETAINED - J.B. MALIK, RATTAN DAYAL, AND A.K.
DESAI AND THREE GOI OFFICIALS HAVE BEEN
APPOINTED - MR. RAMASWAMI, JOINT SECRETARY, MINISTRY
OF PETROLEUM; R. NARASIMHAN, DIRECTOR, MINISTRY OF FINANCE AND
B. KASIM, AN OFFICIAL IN THE BUREAU OF PUBLIC ENTERPRISES TO
SERVE ON THE BOARD.
3. ACCORDING TO KRISHNASWAMI SINCE ESSO RETAINS 26 PERCENT
EQUITY IN HINDUSTAN PETROLEUM THERE ARE NO IMMEDIATE PLANS TO
MERGE THE TWO COMPANIES, BUT HE SAW ECONOMY IN SUCH A MOVE
AT A LATER DATE. HOWEVER, IN VIEW OF THE PRESENT
TREND FOR THE GOI TO GAIN COMPLETE CONTROL
OF THE COUNTRY'S PETROLEUM SECTOR ESSO MAY BE PROMPTED
TO SELL OUT SOONER THAN ITS SCHEDULED DEPARTURE DATE
OF MARCH 1981. THE GOI NOW CONTROLS ABOUT 95 PERCENT OF
INDIA'S PETROLEUM REFINERY AND MARKETING FACILITIES.
4. THE TAKE OVER OF BURMAH SHELL COINCIDES WITH THE OFFSHORE
DEVELOPMENTS OFF THE BOMBAY HIGH AND THE EXPECTED ON-STREAM
PRODUCTION OF CRUDE FROM THIS FIELD BY MID-APRIL WHICH HAS BEEN
EARMARKED INITIALLY FOR THE BURMAH SHELL REFINERY. THE
CAPACITY OF THE REFINERY IS AROUND 5.2 MILLION METRIC TONS.
THE GOI HAS ADVANCED A SUM OF RS. 20 MILLION (DOLS 2.4 MILLION)
FOR MAKING MINOR ALTERATIONS TO THE REFINERY TO ACCOMMODATE
THE SWEET BUT WAXY BOMBAY HIGH CRUDE. THE
INSTALLATION OF A DESALTER IS ALSO CALLED FOR AT A COST OF
RS. 9 MILLION (DOLS 1.1 MILLION).
5. WITH THE PATTERN NOW SET BY BURMAH SHELL, NEGOTIATIONS ARE
UNDERWAY FOR THE GOI TAKEOVER OF CALTEX AND ASSAM OIL, THE TWO
REMAINING PRIVATE SECTOR OIL COMPANIES IN INDIA.
THERE IS TALK OF TRYING TO WIND UP THESE NEGOTIATIONS
DURING THE CURRENT FISCAL YEAR ENDING MARCH 31, 1976.
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THERE IS NO INDICATION AS YET WHETHER OR NOT THE GOI INTENDS
TO MOVE ON OIL INDIA LTD. IN WHICH THE GOVERNMENT OF INDIA AND
BURMAH OIL COMPANY LTD. OF THE U.K. HAVE EQUAL SHARES.SAXBE
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