Bangalore: Oil and Natural Gas Corporation (ONGC) has decided to take over the ailing Mangalore Refinery and Petrochemicals Limited (MRPL) by pumping Rs 660 crore into it, in a move that would make it the first integrated company in the country's hydrocarbon sector with access to its own crude, refinery and retail network.

Announcing this to reporters on February 1, Union Minister for Petroleum and Natural Gas Ram Naik said the Public Investment Board under the Ministry of Finance has approved the Rs 660 crore investment by ONGC to help revive MRPL, which faced the prospect of turning sick.

The investment would give ONGC a 51 per cent stake in MRPL, which was set up as a joint venture between Hindustan Petroleum Corporation Limited (HPCL) and Aditya Birla Group.

ONGC, he said, would pick up the share of the Aditya Birla Group at Rs 2 per share (total Rs 60 crore) and the financial institutions who have given loan had agreed to restructure it by reducing the interest rate, converting part of the loan into equity and giving a four-year moratorium on payments.

Naik said the issue would go to the Cabinet in seven or eight days. Once the Cabinet cleared it, the ONGC would follow "whatever conditions are put", he said in reply to a query.

He said MRPL, which was technologically among the finest refineries in the country, would have become sick had the ONGC not intervened.

MRPL, set up with an initial capacity of three million tonnes, has now nine million tonne capacity.

PTI