IPO: 'If P-LNG can so can we,' argues GSPC

Vol 18, PW 17 (23 Apr 15) Midstream & Downstream

GSPC and partner Adani are finding it so difficult to decide on a third strategic partner for their upcoming Mundra LNG terminal that they might abandon the idea and raise funds through the stock market instead.

“If Petronet-LNG could successfully have an IPO to set up Dahej we can also do it,” says a senior Gujarat government official. SBI had advised Petronet-LNG for its IPO in 2004 and last month (March) GSPC (50%) and Adani (25%) joint venture GSPC LNG asked the state-owned Indian investment bank to look into an IPO for Mundra.

SBI Caps will study the size of the IPO and what percentage of the remaining 25% to offer to the public and institutions. “SBI has lots of LNG experience,” we hear.

“We want to know if an IPO is the right choice. If yes then when should we tap the market? Timing is everything.

” In 2013, SBI shortlisted ONGC, IndianOil, GAIL, Petronet-LNG, BG, and BP and Reliance JV India Gas Solutions (IGS) to be the third Mundra partner. After due diligence, the list was trimmed to IGS, IOC and ONGC.

IGS is the favourite, “But some in GSPC, the Gujarat government and Adani don’t like IGS,” we learn. “Reliance and BP have this bossy image so no other partners are ready to work with them.

They are not team players.”