(Repeats story published on Tuesday with no changes to text)
NEW DELHI/MOSCOW, Sept 29 (Reuters) - Rosneft and Saudi
Aramco are unlikely to bid in the privatisation of Indian
refiner Bharat Petroleum Corp, sources familiar with
the matter said, as low oil prices and weak demand curb their
Russia's Rosneft had expressed an interest in
buying the federal government's 53.29% stake in Bharat Petroleum
(BPCL) when its chief executive Igor Sechin visited New Delhi in
February, while India's trade minister has said that Saudi oil
giant Aramco was enthusiastic about the stake sale.
A Rosneft source, however, said it will not buy BPCL, while
another said the Russian oil major would only be interested in
BPCL's marketing business, which is comprised of fuel depots and
more than 16,800 fuel stations.
"For this, India has to sell BPCL in parts," the source
India's government, which is looking to finance welfare
schemes and bridge a fiscal deficit that has already topped the
annual target, had aimed to raise $8 billion to $10 billion
through the sale of its stake in BPCL.
But BPCL's share price has plunged by nearly 30% over the
past year to trade at about 386 rupees on Tuesday.
"This is not the time to invest in refining ... demand would
be there for oil to chemicals and not conventional products,"
one of the sources familiar with Aramco's thinking said.
Rosneft and India's finance ministry did not respond to
requests for comment.
"We continue to explore potential growth opportunities in
Asia, including India, and will make appropriate updates as and
when necessary," Aramco said, declining further comment.
The Saudi government discussed BPCL's privatisation with an
Indian oil ministry official in July, an oil ministry document
However, a second source familiar with Aramco's thinking
said that after initially showing interest Aramco had not
submitted a formal expression of interest (EoI), even though the
process was extended by two months to Sept. 30.
A third source said that Aramco has halted most of its India
investment plans because of the oil price and is unlikely to bid
"India will not get the deserved price for the BPCL stake
sale in the current environment," a fourth source familiar with
Aramco's thinking said.
This means India may have to pursue other avenues to raise
funds to meet its spending commitments, Kiran Jadhav, who runs
his own asset management firm with a 2 billion rupee ($27
million) portfolio, said.
"If big firms are backing out, this will definitely hurt the
share price and valuation of BPCL," he said.
Sources said that neither Rosneft nor Aramco see much value
in refining because the government in the Indian state of
Kerala, home to BPCL's biggest refinery, might challenge the
privatisation in court and BPCL's two other refineries are in
cities, leaving little scope for revamps and expansion.
Reuters reported last week that India's efforts to privatise
BPCL could spill into the next fiscal year, citing a government
document and sources.
"Aramco has not participated in the EoI so far. Initially we
had expected them to show interest. We are weighing our
options," a source familiar with India's stake sale programme
($1 = 73.7460 Indian rupees)
(Additional Reporting by Rania El Gamal in Dubai
Editing by Susan Fenton, David Goodman and Alexander Smith)