The project will be executed by a joint venture between the Indian Oil Corporation (IOC) and the Kuwait Petroleum Corporation (KPC) in a time span of 48 months. While IOC and KPC would hold 26 per cent equity each, the remaining 48 per cent will be held by the public. The IOC equity will be about Rs 806 crore and the foreign exchange component will be about 2,400 crore.

Meanwhile, Hindustan Petroleum Corporation is believed to have offered the Oil and Natural Gas Corporation a 26 per cent stake in the nine million tonne Punjab refinery. HPCL is also in talks with Exxon Corporation of the US for a similar stake in the project. The Rs 14,000 crore Punjab refinery was first planned as a joint venture between HPCL andSaudi Aramco. The latter pulled out of the project and has teamed up with Shell for a 25:25 downstream venture with the balance proposed to be offered to an oil PSU.

HPCL consequently kicked off discussions with Exxon and the offer to ONGC indicates that the company is open to the idea of a three-way equity arrangement for the Punjab project. Ideally, if everything goes according to plan, the trio - ONGC, HPCL and Exxon - will hold 78 per cent of the equity with the balance to be offered to the public and financial institutions.