The list includes IDFC which will pick up ten per cent, Life InsuranceCorporation of India (five per cent), the Calcutta-based IndustrialInvestment Bank of India (five per cent) and Bank of Baroda which isexpected to take a three per cent stake. Many more are in the running tofill up the balance 25 per cent, sources say.

The project is being promoted by Petronet India, Hindustan PetroleumCorporation and Mangalore Refinery and Petrochemicals. While Petronet willsubscribe to 26 per cent of the equity, the two oil companies will accountfor 13 per cent each.

Interestingly, Oil India has already communicated to the promoters that itis willing to take up to 26 per cent in the project. The upstream major,sources say, is flush with funds and believes that it makes sense to makeinvestments in other key projects like pipelines or refineries (as in thecase of the three million Numaligarh Refinery where Oil India has agreed totake a ten per cent stake).

The Indian Oil Corporation has also conveyed informally that it is open tothe idea of participating in the equity of the project. Reliance Petroleumwas the latest to throw its hat into the ring for a ten per cent stake inMBPL.

The RPL offer has taken observers by surprise as the company is in theprocess of evacuating the products of its 27 million tonne refinery throughthe Vadinar-Kandla pipeline and thereon via the Kandla-Bhatinda network.RPL, along with IOC and Petronet, also plans to build the mega Rs 4,400crore Central India pipeline (CIPL) from its Jamnagar facility to Gwalior.

"It is still difficult to understand why RPL should be interested inparticipating in the equity of MBPL unless it plans to move products fromKandla to Mangalore for further evacuation," experts say. The network hasbeen planned to carry MRPL's output as well as imports from Mangalore port.These could be done away with by substituting products from the RPL refineryinstead.

The initial equity pattern of MBPL comprised HPCL, MRPL and Petronet taking26 per cent apiece while the balance would be offloaded to strategic andfinancial investors. Subsequently, HPCL and MRPL decided to pare theirstakes to 13 per cent each going by a theory that the combined holding byoil companies in a Petronet subsidiary should be confined to 26 per cent.This, incidentally, is threatening to snowball into a major controversyespecially in the backdrop of IOC and RPL keen on a stake in MBPL.

"It is now up to the Petronet board to reach a decision on the matter.Technically, there is no reason why several oil companies should notparticipate in the equity of a pipeline so long as the PSU component isrestricted to 50 per cent," experts say. In the case of MBPL, even if IOCwere to take a 26 per cent stake, the combined PSU holding will be 39 percent (13 per cent of HPCL) even while MRPL and, possibly, RPL will jointlyaccount for 23 per cent. This also holds good for the Cochin-Karur pipelinewhere Bharat Petroleum Corporation and Cochin Refineries hold 26 per centand 23 per cent each as also the Chennai-Tiruchi-Madurai network where IOCand Madras Refineries will jointly account for 49 per cent.

IOC has, incidentally, made it clear that its participation in the projectwould depend on a clear definition of its role vis-a-vis HPCL, which is thelead manager, as well as a board representation in the joint venture. Thiswill hold good for RPL also. Experts say that it makes enormous sense forthese two companies to be equity holders in MBPL as the pipeline will easethr traffic on the Kandla-Bhatinda network.

IOC also has sufficient expertise in pipeline management and would thereforebe an ideal support for the project, observers add. The Fortune 500 companyhas terminals at vital points along MBPL which would be of great help asregards the product distribution pattern.

MBPL will be 364 km long and designed for a final throughput of 8.5 milliontonnes. However, other facilities like a pumping system and loadingfacilties are currently designed for a throughput of 5.6 million tonnes. Thepipeline will transport motor spirit, superior kerosene oil, high speeddiesel, aviation turbine fuel and naphtha from MRPL.