Indian oil and gas companies are said to be looking to monetise the stakes in their pipeline networks using the Infrastructure Investment Trusts (InvITs), reports Livemint.
InvITs are collective investment vehicles similar to a mutual fund, which enables direct investment of money from individual and institutional investors in infrastructure projects to earn a small portion of the income as return.
InvITs enable developers of infrastructure assets to monetise their assets by pooling multiple assets under a single entity (trust structure). In India, InvITs are governed by SEBI (Infrastructure Investment Trusts) (Amendment) Regulations, 2016.
According to the report, the three companies have prepared blueprints for floating InvITs.
The InvITs will reportedly house pipelines totalling 5,000 km. The companies may offload 26-49 per cent of their stakes in these projects.
“These pipelines are worth lakhs of crores of rupees and, to begin with, a minority stake would be offloaded. The companies may select one or two pipelines, to begin with. The condition, however, is that the companies retain the operations and control of the pipelines," a person aware of the development was quoted in the report as saying.
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