Indian Oil Corporation (IOC) has finished purchasing Mercator Petroleum for about Rs 148 crore.

In compliance with the 2016 Insolvency and Bankruptcy Code, the National Company Law Tribunal, Mumbai Bench, approved IOC’s resolution plan for the purchase of a 100% interest in Mercator Petroleum Limited (MPL).
In Gujarat’s Cambay Basin, MPL runs an onshore block for oil and gas exploration. The company purchased the particular block, CB-ONN-2005/9, in the seventh round of the New Exploration Licensing Policy (NELP) bid process in 2008. It is believed to have 45.5 million barrels of in-place oil reserves.

In November 2019, it was decided that the Indian Oil Corporation would buy oil from this block for its Koyali refinery, which is around 60 kilometres away. As part of the resolution plan, IOC would pay secured creditors, who have admitted claims totalling Rs 291 crore, and Rs 135 crore. The unsecured creditors, who had accepted claims totalling Rs 118 crore, have no set amount to be paid. The resolution proposal offers Rs 5.40 crore to operational creditors (vendors, labourers, workers, and statutory dues) against their total accepted claims of Rs 73 crore. In addition, IOC will pay Rs 8.7 crore in charges related to the insolvency proceedings.

After Mercator Petroleum missed payments of Rs 2.87 crore, the Cayman Island-based oil services company Halliburton Offshore Services Inc. filed for bankruptcy in August 2021.

IOC has become the second public sector organization (PSU) to acquire a company through a bankruptcy proceeding with this transaction. GAlL, the biggest gas provider in India, expanded its petrochemical operations earlier in March when it paid Rs 2,079 crore to acquire the insolvent private-sector chemical company BF Petrochemicals.

In the IDBI Bank-led insolvency procedure, GAIL outbid an alliance consisting of IOC and Oil and Natural Gas Corporation (ONGC) to recoup debts to operating and financial creditors totalling Rs 5,628 crore. To build a purified terephthalic acid plant in the Mangalore Special Economic Zone with an annual capacity of 1.25 million tonnes, JBF Petrochemicals was founded in 2008. However, due to the company’s financial defaults, the operations were suspended in 2017.

The primary business activities of Mercator Petroleum Ltd., a wholly-owned subsidiary of Mercator Ltd., are petroleum exploration, development, and production in India and other countries.

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