On the contrary, say top ministry sources, the team would be more inclined to present a proposal linking IBP with Bharat Petroleum Corporation, Cochin Refineries, Numaligarh Refinery and Bongaigaon Refinery and Petrochemicals. ``This is the most viable option and there is no way IBP can be merged with either MRL or CRL given its low equity base and poor presence in the South,'' they added.

In fact, a panel headed by former CRL chief, J Jayaraman, had prepared separate restructuring proposals for MRL and CRL and was of the view that these stand-alone refiners would be able to survive in a deregulated environment only if they entered into tieups with strong marketing companies.

The Jayaraman Committee is believed to have recommended an alliance leading to a merger, if needed, of MRLand IOC and of CRL and BPCL. ``Though IBP is a stand-alone marketing company, it would be wrong to assume that this status alone would permit a marriage with a sole refiner like MRL or CRL,'' sources said.

According to them, IBP's negligible presence in the southern market would not serve the two oil companies and it would make more sense for IOC and BPCL to step into the picture. Both the Navratnas have a strong marketing tie-up which would help CRL and MRL to have a ``realistic'' route for vending their products.

IBP is slated to subscribe to its 19 per cent equity in the three million tonne Numaligarh refinery and is well positioned in the eastern region to market its products. Likewise, this can also be done in the case of BRPL, a suggestion mooted by international consultant, Arthur D Little in its report on restructuring the Indian downstream sector four years ago.

The logic of roping in BPCL also stems from the fact that the oil PSU is the major promoter of Numaligarh refinery and will, hence,help market its products through its own retail outlets. And with the Jayaraman Committee suggesting a BPCL-CRL alliance, this would be the best bet for IBP in a deregulated scenario.

The five-member committee appointed by the government incidentally includes Jayaraman apart from AK Sinha, director (finance) IBP, AK Bide, director finance, Oil Coordination Committee and A Sachdev, managing director of Eicher Consultancy Services. Reports have indicated that their report will be ready by the end of this year.

The ministry of petroleum and natural gas is also believed to be evaluating the earlier recommendations on MRL and CRL submitted quite sometime ago.

Sources have indicated that the reaction has been quite favourable and it is more than likely that the suggestions will be accepted which means that IOC will go along with MRL and BPCL with CRL. This would only leave BRPL and IBP paving the way for a five- way arrangement with BPCL, CRL and BRPL.

There is also a school of thought that believes thatsince BRPL is largely into the petrochemicals business, it makes sense for the Indian Petrochemicals Corporation (IPCL) to consider an alliance with the PSU. This could go hand in hand with a tieup between IPCL's Baroda complex and IOC's Koyali refinery in Gujarat to assure supply of naphtha.

The Disinvestment Commission, it may be recalled, had suggested paring government stake in IBP from the present 60 per cent to 26 per cent while offering 25 per cent to a strategic partner. The company's top brass, however, felt that an alliance with MRL, CRL and BRPL was a more practical solution.